The world may be sleepwalking into a third financial crisis and it is not far away. Within the last five years, we have witnessed two global financial crises in banking and in the Eurozone.
Governments have fallen, financial institutions have crashed, deficits have ballooned and people have rioted in the streets. If we are honest, we did not predict and did not act to prevent these crises, and we risk making the same mistake again.
In January 2012 a study by the risk rating agency Standard and Poor's reported that "If governments do not change their social protection systems, they will likely become unsustainable." A major focus of the study was healthcare costs arising from ageing populations. They went on to say "If no reforms are adopted, healthcare-related credit downgrades would likely start within three years, eventually leading to an increase in the number of junk-rated countries as of 2020," So, countries face the risk of being downgraded as early as 2015. This is a real problem now.
All societies are ageing. Today there are 800 million people aged 60 and over. By 2030 there will be 1.4 billion and by 2050, 2 billion - getting on for a quarter of the world's population. Ageing is also happening faster in emerging economies. By 2050, two thirds of the world's population over 80 will be living in Asia, Latin America and China. In the UK the NHS is currently embarked on a savings programme of £20 billion by 2014/15 just to stand still because of rising demand.
So, the health of health systems will soon become the health of economies. Governments which do not act will be spending to fund higher interest rates instead of spending that money on the health of their citizens. Low and middle income countries which do not face the same problem at present have the opportunity now to head this problem off at the pass.
As we have seen in the Eurozone, the relationship between the demands of financial institutions and those of citizens can easily come apart and this is a problem for governments. Citizens with rising expectations paying through taxes or insurance could face significant cuts to services, whilst still being asked to contribute the same amounts. This has the feel of a perfect storm, especially in high-income countries.
Next week Lord Darzi will be hosting an international summit, which will have a strong focus on how to respond to health in ageing societies. The report on ageing chaired by Phil Hope, former Minister of State for Care Services will highlight five problems that Governments need to solve to avoid this storm. Ensuring the sustainable financing of health and social care; reducing the flow of older patients into hospital through prevention; developing new ways of treating patients at home or closer to home; providing better support for self-care by patients and carers at home, and ensuring that health and care systems are performance managed to match the best in the world.
On financing, many countries have declining numbers of working age people to support those of retired age. Yet many older people choose to work after retirement on a paid or voluntary basis to create an income and maintain their sense of purpose as work has positive benefits for older people's mental and physical health. So Governments should consider what retirement really means for older people as many could continue to work contribute to society through tax or voluntary activity. In high income countries, older people often own significant amounts of wealth in the form of housing. In the UK, for example people aged over 65 own over one trillion pounds in property. Finding innovative ways to unlock a proportion of this wealth such as equity release schemes offers a possible route to fund the additional costs of social care. We know that poorer older people have greater levels of ill-health, so finding ways to provide additional income support for them in lower and middle income countries could help to reduce the burden of their health and care costs. Enabling remittances to be sent home more easily and safely as shown by M-Pesa in Kenya which uses mobile phone technology can be important in maintaining incomes; along with very low cost health insurance in low income countries as shown by the Grameen Health Insurance in Bangladesh.
Reducing the flow of patients into hospital and developing new services at home also offer significant potential for large savings. The difference between the best and worst performing health systems on hospital referrals, especially for emergencies is large and hard to explain. These variations could be significantly reduced by Governments simply following and implementing best-practice. Providing older people who are at risk of admission with a care plan and the necessary support from clinical and non-clinical staff is central to achieving this. For example, diabetics who check their blood sugar levels four times a day can reduce emergency admissions by almost 80%. Japan's compulsory insurance system is associated with annual health checks and other prevention programmes starting in middle age. In China and Brazil they are taking prevention further with national programmes to provide greater access to physical exercise for older people. In China, 70 per cent of urban communities and 50 per cent of rural townships in rural areas have established sports associations for seniors.
Technology can help too. From smartphone devices that enable non-professionals to diagnose early-stage cataracts, to devices to help older people to take their medicines correctly; devices that enable patients to monitor their condition and advice and support for carers through the internet. All these and more are beginning to become available.
Prevention extends beyond health and social care. Helping older people to maintain income, socialise and travel are also important. The WHO programme on 'age friendly' cities aims to take this all round view at the level of a whole city and now operates in a number of cities. Japan is furthest advanced in creating 'age friendly cities' through a combination of better urban design and more accessible transport. For example, all buses will be accessible by 2015.
Better support for self - care by patients at home will help to improve health outcomes and reduce admissions to hospital. Support for carers is important as exhausted carers often feel no option other than to call for the ambulance which results in an admission and the UK we provide cash and other support for carers. Other countries like Singapore and India are looking to reinforce traditionally strong family values through providing tax breaks, housing subsidies and even penalties for neglecting to provide care for older relatives.
The final challenge for Governments is to ensure that the transition to a lower cost model of health care is delivered. The levers available to any Government will differ. Tax incentives, performance management, analysis, capacity planning, performance comparisons and paying for best-practice are good examples.
A real step forward now would be to learn from the risk rating agencies and even partner with them to develop a more sophisticated rating index for health and care systems to allow Ministers and policymakers to make comparisons and to share learning. This needs to be accompanied by support to Governments to help them make the shift to create affordable, high quality health systems without having to ration care for older people or find themselves stumbling again into the third financial crisis in a decade.