After falling sharply in 2010, health spending remained flat across Organisation for Economic Cooperation and Development (OECD) countries in 2011, but pharmaceutical spending, as a "prime target" for health cost cuts, experienced deeper cuts during the year, the Organisation reports.

While health spending grew close to 5% on average year-on-year from 2000 to 2009 in OECD member-nations, then followed sluggish growth of around 0.5% in 2010 and 2011 as the economic crisis continued to have an impact, particularly in those European countries hardest-hit by the crisis, according to OECD Health Data 2013.

Preliminary figures for some countries suggest a continuation of this trend in 2012, it adds.

The decline has been driven primarily by a collapse in the growth of government health spending since 2009, recording close to zero growth in both years on average. Private health spending also slowed down in many countries in 2010 and 2011, as household incomes remained flat or decreased, although this reduction was more limited.

In Greece, overall health spending dropped 11% in both 2010 and 2011 after yearly growth rate of more than 5% on average between 2000 and 2009, and these reductions were mainly driven by deep cuts in government expenditures, says OECD. 

Ireland, Iceland and Spain also experienced two consecutive years of negative growth in health spending, while some other nations, such as Estonia and the Czech Republic, saw severe falls in expenditure in 2010 followed by a modest rebound in 2011. Other countries, including Portugal and Italy, may have delayed cuts in 2010 but then reduced public health spending in 2011; in Portugal, public spending dropped 8% in 2011 after remaining stable between 2009 and 2010.

Only two OECD countries - Israel and Japan - have seen an acceleration in health spending since 2009 compared with the period before, the report notes.

Away from Europe, it finds that health spending growth also slowed in 2010 and 2011, notably in Canada (3% in 2010 and 0.8% in 2011 in real terms), and the US (2.5% in 2010 and 1.8% in 2011, also in real terms).

In the US, the share of health spending to Gross Domestic Product (GDP) remained at 17.7% between 2009 and 1011, after years of steady increases. However, the report adds: "it is not clear yet whether the recent slowdown reflects mainly cyclical factors and may therefore not have lasting effect when economy growth picks up, or whether it reflects more structural changes such as a slow diffusion of new technologies and pharmaceuticals, and changes in provider payments resulting in greater efficiency."

OECD also reports that reductions in public spending on health in many of its member-nations have typically been made across the board, and that pharmaceutical spending has been a prime target, with expenditures here falling slightly in 2010 followed by deeper cuts in 2011. 

Many countries have increased cost-sharing for pharmaceuticals, reduced prices and coverage, and promoted the use of generics. For example, in 2011 Portugal, Greece and Spain reduced spending on prescription drugs by 20%, 13% and 8% respectively, while in Spain, the share of generic drugs (in the total value of consumption) more than doubled between 2006 and 2011.

The OECD's data shows that health expenditures in the UK accounted for 9.4% of GDP in 2011. This is slightly above the OECD average of 9.3%, but the UK’s spending as a share of GDP is much lower than in the US, which spent 17.7% of its GDP on health in 2011. The UK figure is also slightly lower than some European countries such as the Netherlands (11.9%), France (11.6%) and Germany (11.3%).

In terms of per capita spending on health, the UK continued to spend slightly more in 2011, at US$3,405, than the OECD average of US$3,339 (adjusted for purchasing power parity). Health spending per capita in the UK remains at 40% of the level in the US, which spent $8,508 per capita in 2011, OECD reports.