An initiative of the Inter-American Development Bank (IDB).
Between 2011 and 2023, Criteria operated as a knowledge network to support countries in the region in making informed decisions about which health technologies to fund with available public resources and how much to pay for them. In addition, Criteria has provided technical assistance to countries in this field.
Since late 2023, Criteria has focused more comprehensively on health spending efficiency and will continue providing technical assistance to countries, with a priority focus on this topic.
Why Does Health Spending Efficiency Matter?
Countries in Latin America and the Caribbean (LAC), like most globally, face dual challenges. First, they must contend with fiscal constraints, increasing debt, and inflation, partly resulting from the COVID-19 pandemic and other global imbalances. Second, they face growing pressures on health spending due to demographic and epidemiological changes, expensive new health technologies, and the commitment to advancing Universal Health Coverage (UHC). Additionally, there are emerging needs, such as pandemic preparedness and climate change adaptation.
A recent Johns Hopkins/IDB study predicts an annual increase of 2-3% in per capita health spending over the next 30 years in the region.
In this context, optimizing health spending efficiency is more critical than ever. The potential benefits are significant: an IDB study indicates that LAC countries could increase their average life expectancy by 3.4 years by improving the efficiency of health spending.
Key Topics in the Efficiency Agenda
The new efficiency agenda focuses on both allocative efficiency and technical efficiency.
What is Allocative Efficiency?
This occurs when no alternative combination of health goods and services could improve the health system's outcomes beyond its current level.
What is Technical Efficiency?
This occurs when no alternative combination of inputs could produce the same level of goods and services at a lower cost than the current one. The main topics to be addressed include:
a) Health prioritization
- Designing and implementing health benefits plans.
- Developing capacities for evidence-based decision-making.
- Strengthening cost estimation interventions.
- Promoting disinvestment in wasteful technologies.
b) Efficient management of medicines and key supplies
- Increasing competition (e.g., supply and demand for generics and biosimilars).
- Promoting joint procurement/negotiation.
- Encouraging policies to achieve fair pricing for medicines and medical devices.
- Improving supply chain management.
- Promoting the rational use of medicines.
- Increasing production capacity (e.g., vaccines and other health technologies).
c) Efficient management of the health services network
- Conducting public health spending reviews.
- Preparing analyses of the health services network (demand and supply) with a focus on the triple aim: outcomes, efficiency, and quality.
- Preparing master plans for health infrastructure.
- Supporting health financing reforms, including efficient provider payment methods.
- Supporting improvements in health budget planning and execution.
Criteria will continue supporting countries in the region to enhance the efficiency of health spending in various ways:
a) Promoting policy dialogues on health spending efficiency.
b) Providing technical assistance to countries to improve health spending efficiency.
c) Generating and disseminating analytical products, tools, and educational materials to evaluate and optimize health spending efficiency.
d) Establishing strategic partnerships with other stakeholders.
Why Does Health Spending Efficiency Matter?
Countries in Latin America and the Caribbean (LAC), like most globally, face dual challenges. First, they must contend with fiscal constraints, increasing debt, and inflation, partly resulting from the COVID-19 pandemic and other global imbalances. Second, they face growing pressures on health spending due to demographic and epidemiological changes, expensive new health technologies, and the commitment to advancing Universal Health Coverage (UHC). Additionally, there are emerging needs, such as pandemic preparedness and climate change adaptation.
A recent Johns Hopkins/IDB study predicts an annual increase of 2-3% in per capita health spending over the next 30 years in the region.
In this context, optimizing health spending efficiency is more critical than ever. The potential benefits are significant: an IDB study indicates that LAC countries could increase their average life expectancy by 3.4 years by improving the efficiency of health spending.
Key Topics in the Efficiency Agenda
The new efficiency agenda focuses on both allocative efficiency and technical efficiency.
What is Allocative Efficiency?
This occurs when no alternative combination of health goods and services could improve the health system's outcomes beyond its current level.
What is Technical Efficiency?
This occurs when no alternative combination of inputs could produce the same level of goods and services at a lower cost than the current one. The main topics to be addressed include:
a) Health prioritization
- Designing and implementing health benefits plans.
- Developing capacities for evidence-based decision-making.
- Strengthening cost estimation interventions.
- Promoting disinvestment in wasteful technologies.
b) Efficient management of medicines and key supplies
- Increasing competition (e.g., supply and demand for generics and biosimilars).
- Promoting joint procurement/negotiation.
- Encouraging policies to achieve fair pricing for medicines and medical devices.
- Improving supply chain management.
- Promoting the rational use of medicines.
- Increasing production capacity (e.g., vaccines and other health technologies).
c) Efficient management of the health services network
- Conducting public health spending reviews.
- Preparing analyses of the health services network (demand and supply) with a focus on the triple aim: outcomes, efficiency, and quality.
- Preparing master plans for health infrastructure.
- Supporting health financing reforms, including efficient provider payment methods.
- Supporting improvements in health budget planning and execution.
Criteria will continue supporting countries in the region to enhance the efficiency of health spending in various ways:
a) Promoting policy dialogues on health spending efficiency.
b) Providing technical assistance to countries to improve health spending efficiency.
c) Generating and disseminating analytical products, tools, and educational materials to evaluate and optimize health spending efficiency.
d) Establishing strategic partnerships with other stakeholders.
Between 2011 and 2023, Criteria supported 9 countries through 21 projects, conducted 91 webinars, and published 4 books, 18 technical notes, and 27 policy briefs. The map below illustrates some of Criteria's key contributions to the region.
Here you will find dozens of videos on explicit health prioritization and price intervention strategies for medicines, as well as presentations from our guests and transcripts. Starting in 2023, you will also find videos on broader topics related to the efficiency agenda.
Today, all countries around the world face the enormous challenge of making efficient use of their resources to address the infinite health needs of their populations. To support this effort, the IDB has had the privilege of bringing together the world’s leading experts in explicit prioritization policies and medicine price regulation.
What to Finance in Health and at What Price?
Learn from over 40 experts from around the world about two key strategies to improve the efficiency of public health spending and support countries to move towards Universal Health Coverage (UHC): explicit prioritization in health and instruments to achieve more affordable prices for medicines.
Welcome to our library, where you will find IDB publications on health benefits plans, health technology assessment, pharmaceutical policy, health spending efficiency, and much more!
Discover the topics in which we work to improve lives in Latin America and the Caribbean.
Explore our offices across countries and the work they do to improve lives.