Macroeconomic fluctuations and the prioritisation of healthcare funding by local governments

Longitudinal evidence from 5,461 Brazilian municipalities

Datos Bibliográficos

ID11490709
AutoresHelena Arruda (Instituto de Estudos para Políticas de Saúde (IEPS) , São Paulo), Helena Karolyne Arruda (Instituto de Saúde), Karen Codazzi (Instituto de Estudos para Políticas de Saúde (IEPS) , São Paulo), Rudi Rocha (0000-0003-0689-6963, Instituto de Estudos para Políticas de Saúde (IEPS) , São Paulo), Marc Suhrcke (0000-0001-7263-8626, Luxembourg Institute of Socio-Economic Research), Thomas Hone (0000-0003-0703-6973, Instituto de Estudos para Políticas de Saúde (IEPS) , São Paulo)
Año2026
Volumen41
Número5
Páginas887-897
Fecha de publicación2026-03-30
Peer ReviewedSí
Open AccessSí
TipoARTICLE
RevistaHealth Policy and Planning (JOURNAL)
Identificadores de la revistaISSN: 0268-1080 • E-ISSN: 1460-2237
EditorialOxford University Press (PUBLISHER • GB)
DOI10.1093/heapol/czag043
PMID41906640
OpenAlexW7143399010
IdiomaEN
Referencias citadas7

Securing sufficient healthcare funding remains a critical challenge for many low and middle-income countries (LMICs), especially during periods of economic instability. While economic growth often boosts health system finances in LMICs, little is known about how local governments adjust healthcare spending in response to macroeconomic fluctuations, particularly during recessions. This study analyses a longitudinal dataset of 5,461 Brazilian municipalities between 2004 and 2017, using fixed-effect panel regressions to examine the relationship between municipal Gross Domestic Product (GDP) changes and healthcare spending. There is a positive elasticity between the economic conditions, measured by GDP, and municipal financial expenditures, particularly health and social expenditures. A 1% increase in municipal GDP per capita was associated with a 0.06% [95% CI 0.04 - 0.09] increase in total municipal expenditures and a 0.12% [95% CI 0.06 - 0.18] increase in health and sanitation expenditures. However, during recessions, municipal governments reduced health expenditures, particularly for capital investments. Municipalities with lower income per capita and lower private insurance coverage were more vulnerable to these cuts in economic downturns. We find suggestive evidence that the cuts in poorer municipalities and in municipalities relying disproportionately on federal transfers were more pronounced for social and health expenditures, although the difference between municipalities is small. These findings highlight the sensitivity of local finances to economic fluctuations, underscoring the need for policies that protect healthcare funding during economic downturns

Capital expenditure · Gross domestic product · Health care · Health economics · Panel data · Per capita · Sanitation · Employment and Welfare Studies · Global Health Care Issues · Healthcare Systems and Reforms · Health Policy