Strategies to reduce wasteful spending: Turning the lens to hospitals and pharmaceuticals

Evidence suggests that as much as one-fifth of health spending is wasteful, and could be reduced or eliminated without undermining health system performance. With as much as 9.6% of European GDP directed to health care, reducing such spending is thus important not only for improving access to needed care, but also for ensuring health system resilience.This chapter points the lens at two particular areas of waste: hospitals and pharmaceuticals. Hospitals represent an integral and essential component of any functioning health system, but are often the most expensive part. In many instances, the resources consumed in hospitals can be put to more efficient use. Improved community care for chronic diseases could reduce millions of avoidable admissions and bed days across EU countries. Reducing unnecessary investigations and procedures would not compromise quality. Greater use of day surgery and reducing delays in discharging patients no longer requiring inpatient care could also free-up resources for patients with greater needs.Minimising waste and optimising the value derived from expenditure on pharmaceuticals are also critical to efficient and sustainable health systems. This chapter discusses a mix of supply and demand side policy levers that include ensuring value for money in selection and coverage, procurement and pricing of medicines exploiting the potential of savings from generics and biosimilars encouraging rational prescribing and use and improving adherence to treatment.Ultimately, progress in reducing wasteful spending may be seen not only as a barometer of quality improvement, but also an ethical and financial imperative in the pursuit of more resilient and equitable health care systems.