The Covid-19 pandemic and its repercussions have devastated communities and economies around the world. Barely six months old, Covid-19 now looks set to become the most expensive malady in history, costing the global economy an estimated 3-8 per cent of GDP this year alone.
But the chronic cost of poor health, though less obvious, is far higher. In a new McKinsey Global Institute report, we estimate that poor health reduces global GDP by 15 per cent each year – about twice the pandemic’s likely negative impact in 2020 – as a result of premature deaths and health conditions that leave people unable to participate fully in society and the economy.
The good news is that the tools we need to tackle this problem are within reach. Our report therefore proposes a path forward to promote both better health and faster economic growth, at little or no extra cost.
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Our research leaves us strongly convinced that improving health using existing tools could be a socioeconomic game changer. Few investments enhance wellbeing and reduce inequity so effectively, while also delivering such high economic returns.
To deliver better health outcomes, governments, health-care providers, businesses, and individuals can pivot to prevention and use existing measures more widely. In our research, we examined the health challenges of about 200 countries.
We found that implementing known interventions – such as public sanitation programs, surgical procedures for treating ailments like cataracts and heart conditions, and expanded access to primary care – could reduce the global disease burden by 40 per cent over 20 years, and by 47 per cent in low-income countries.
A reduction of that magnitude would deliver tremendous benefits. For example, a 65-year-old in 2040 could be as healthy as a 55-year-old today, infant mortality would decline by 65 per cent, the health-inequity gap would narrow, and 230 million more people would be alive by 2040.
Prevention is key to reducing the disease burden. We found that 70 per cent of the health benefits would accrue from ensuring cleaner and safer environments, healthier behaviors (including by addressing the social factors underlying them), regular medical checkups, and improved access to vaccines.
Preventing diabetes through dietary changes and physical activity is among the most effective measures in this regard, while addressing road safety, air pollution, and substance abuse also may be critically important, depending on the country. Other interventions that make a difference include those targeting cardiovascular disease, immunisation for children, and flu vaccines for adults.
The remaining 30 per cent of the benefits would come from therapeutic interventions, such as multimodal treatments for lower-back pain, migraines, and mental-health problems. Such approaches often combine education with psychological support, physical therapy, and medicines.
Focusing on prevention may also help to increase populations’ resilience to health shocks such as pandemics and climate change. Such improvements are urgently needed: the Covid-19 fatality rate has been far higher among people with pre-existing conditions such as obesity and heart disease.
Better still, the world would reap economic rewards as healthier people prosper, employment expands, and productivity increases. We estimate that better health could add $12 trillion to global GDP by 2040, representing an 8 per cent boost – or 0.4 percentage points of additional growth per year.
These gains not only could help the global economy to recover from the impact of the Covid-19 pandemic, but also could counter longer-term demographic headwinds arising from an aging population.
And there is a further advantage: focusing on proven health interventions could deliver an incremental economic benefit of $2-4 for each dollar invested. In higher-income countries, the implementation costs could be more than offset by productivity gains in health-care delivery. But emerging economies may need to strengthen their health infrastructure to enjoy similar returns.
Orchestrating a health transformation is challenging, as past reform efforts have demonstrated. But public-health responses to the Covid-19 crisis have shown that rapid change is possible when the situation demands it.
For example, hospitals have rethought their patient and staff flows in Covid-19 wards, while doctors and patients have shifted rapidly to remote health consultations. The speed of medical innovation and the level of global collaboration on research and development have been unprecedented.
And people around the world have changed their behavior to curtail the spread of the coronavirus, including by wearing face masks, washing their hands frequently, and reducing face-to-face interactions.
Our research leaves us strongly convinced that improving health using existing tools could be a socioeconomic game changer. Few investments enhance wellbeing and reduce inequity so effectively, while also delivering such high economic returns.
Confronting the pandemic gives us a once-in-a-generation opportunity to take the steps needed to advance broad-based health and prosperity in the long term. We can’t afford to pass it up.
Jaana Remes is a San Francisco-based partner at the McKinsey Global Institute. Katherine LinCovider is a Chicago-based partner at McKinsey & Company.
Copyright: Project Syndicate, 2020.
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