Is the quest for efficiency harmful to health equity? An examination of the health efficiency-equity nexus in OECD countries over the past two decades

Has the quest for efficiency in OECD health systems impacted the social gradient of health? We examined the cross-dynamics of the health system equity-efficiency nexus among OECD countries in the past two decades. We used a three-step methodology based on annual macro-level data from 36 OECD countri...

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Bibliographic Details
Published in:Social science & medicine (1982) Vol. 383; p. 118379
Main Authors: Bousmah, Marwân-al-Qays, Abu-Zaineh, Mohammad, Combes, Simon, Ventelou, Bruno
Format: Journal Article
Language:English
Published: England Elsevier Ltd 01.10.2025
Subjects:
Efficiency, Organizational - standards
Equity-efficiency tradeoff
Granger causality
Health Equity - standards
Health Equity - statistics & numerical data
Health Equity - trends
Health system
Humans
Organisation for Economic Co-Operation and Development - organization & administration
Organisation for Economic Co-Operation and Development - statistics & numerical data
Reverse causality
Socioeconomic Factors
Stochastic frontier analysis
Health system
Reverse causality
Equity-efficiency tradeoff
Stochastic frontier analysis
Granger causality
ISSN:0277-9536, 1873-5347, 1873-5347
Online Access:Get full text
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Summary:Has the quest for efficiency in OECD health systems impacted the social gradient of health? We examined the cross-dynamics of the health system equity-efficiency nexus among OECD countries in the past two decades. We used a three-step methodology based on annual macro-level data from 36 OECD countries for the period 2004–2021. First, we estimated the efficiency of health systems using a stochastic frontier analysis. We then assessed the equity of health systems using simple measures of income-related inequality in self-assessed health. Lastly, we estimated the dynamic relationship between health system efficiency and equity using a panel Granger causality analysis. We also stratified the analysis by type of health system: viz. publicly- vs. privately-dominated health service provision. We find evidence for a bidirectional causality between health system efficiency and equity. An increase in health system efficiency leads to an increase in socioeconomic inequalities in health; a result particularly salient in countries with predominantly private health service provision. Interestingly, decreases in socio-economic inequalities in health are likely to lead to higher health system efficiency, especially in countries where the health system relies predominantly on public provision. The pursuit of efficiency gains in OECD health systems has not been a precondition for socioeconomic equity in health. Adverse effects of efficiency-seeking interventions on health equity are particularly apparent in the private provision of healthcare. However, addressing health inequalities provides a plausible route to enhance efficiency. •There is a long-standing debate on the equity-efficiency nexus within health systems.•We analyse the bidirectional efficiency-equity relationship in OECD health systems.•Efficiency gains jeopardize equity, especially when health service provision is mainly private.•However, reducing health inequality may lead to higher health system efficiency.
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ISSN:0277-9536
1873-5347
1873-5347
DOI:10.1016/j.socscimed.2025.118379