How countries pay for UHC

Prepaid and pooled, not pay-as-you-go

UHC means all people have access to the full range of quality health services they need, when and where they need them, without financial hardship (WHO). The payment side of that definition is prepaid and pooled: money is collected before illness strikes — through general taxation, compulsory or voluntary prepaid insurance (social health insurance), and external aid — and pooled so that the healthy subsidise the sick and the better-off subsidise the worse-off. WHO recommends shifting from out-of-pocket payments toward publicly funded prepaid coverage. There is no single global payment mix; it varies by country.

The three functions of health financing

WHO describes health financing as three core functions:

1. Revenue raising — collecting money from government budgets, compulsory or voluntary prepaid insurance, direct out-of-pocket payments, and external aid.
2. Pooling of funds — accumulating prepaid funds on behalf of some or all of the population, so financial risk is spread and no household faces the full cost of a serious illness alone.
3. Purchasing of services — paying and allocating resources to health service providers.

Pooling is the point. Without it, each household pays its own bill; with it, a cancer diagnosis is a shared cost, not a household bankruptcy.

What countries actually spend

There is no single global figure for health spending — it is a country- and year-specific indicator, published in the WHO Global Health Expenditure Database (GHED). The table below gives current health expenditure for eight countries in 2022, the latest year with complete figures at the time of writing.

Source: WHO Global Health Expenditure Database, 2022 (via World Bank data). The gap between the top and bottom rows is the financing story in one table: the United States spent about 140 times as much per person as Nigeria, and about 150 times as much as India. What that spending means for the people paying it — the average premiums US workers pay and why marketplace premiums are rising for 2027 — is in US health-insurance costs, explained.

Catastrophic spending

Health spending is catastrophic when it exceeds a threshold share of a household’s total expenditure or income. WHO (SDG indicator 3.8.2) defines “large” as exceeding 10% or 25% of total household expenditure or income. In 2022, 2.1 billion people faced financial hardship from health costs, including 1.6 billion living in poverty or pushed deeper into it by out-of-pocket health expenses (WHO UHC fact sheet, published 5 December 2025). That is 26% of the world’s population, down from 34% in 2000 — but the fall came mainly from global poverty reduction, not from better financial protection.

Impoverishing spending

Spending is impoverishing when out-of-pocket payments push a household below a poverty line, or deepen the poverty of a household already below it. The WHO definition uses the $2.15 or $3.65 per day poverty lines (2017 purchasing-power parity) or a relative line of 60% of median consumption. Between 2000 and 2022, impoverishing out-of-pocket spending fell mainly because fewer people were pushed further into poverty (26.6% to 18.6%), while the share pushed into poverty stayed largely unchanged at 1.9–2.8% (WHO UHC fact sheet, 2025). The hardship is concentrated: in 2022, 3 out of 4 people among the poorest faced financial hardship from health costs, compared with fewer than 1 in 25 among the richest.

Financial protection: one half of UHC

Financial protection is one of the two dimensions of UHC, alongside service coverage: people can use the health services they need without facing financial hardship. It is measured by catastrophic spending and impoverishing spending, as above. The service coverage index rose from 54 to 71 between 2000 and 2023 — but about 4.6 billion people were still not fully covered in 2023, and at the current pace the world is not on track to achieve UHC by 2030 (WHO UHC fact sheet, 2025). Coverage without protection is half a system.

Who pays for pandemic preparedness

Preparedness is where the financing gap is starkest. A WHO/OECD/World Bank report for the G20 (10 October 2025) estimates that pandemic-preparedness spending is about 10% of total health spending in low-income countries, 8% in lower-middle-income countries, and about 3% in upper-middle- and high-income countries. In per-person terms the order reverses: about $2–3.50 per person per year in low- and middle-income countries, $19 in upper-middle-income countries, and over $120 in high-income countries. About 80% of the spending contributing to preparedness in low-income countries is externally financed, mostly from aid budgets — and bilateral health aid from OECD donors fell 40% in 2023 from its COVID-driven peak in 2022. The report flags its own numbers as best estimates rather than observed expenditure, because measuring preparedness spending is difficult. The underlying gap is wider still: in 2022, average public spending on health in low-income countries was around $9 per person per year, against $2,700 in high-income countries.

Buying together: pooled procurement

One way smaller budgets stretch further is buying together. The Global Fund’s Pooled Procurement Mechanism aggregates demand across grant implementers to negotiate prices and delivery conditions with manufacturers; its online platform is wambo.org, where buyers search for products and submit and track orders and invoices. In 2025 the mechanism managed approximately $1.02 billion in orders, serving grant implementers in 81 countries. Products include antiretrovirals, antimalarial medicines, insecticide-treated nets, viral-load tests and rapid diagnostic tests. A policy adopted in July 2026 also lets buyers use the mechanism with non–Global Fund financing; those orders currently require payment in advance.

New money for malaria

In a separate financing move, the Global Fund Board approved a new Malaria Impact Accelerator at its 56th meeting (28–30 October 2026; decision announced 3 November 2026). The mechanism is designed to mobilise and deploy substantial additional restricted financial contributions from private philanthropy through the Global Fund, for country-led malaria prevention and treatment in the countries with the highest malaria burden and lowest economic capacity. Press reports have cited a $2–3 billion potential figure; that figure is not in the Global Fund’s own release and is not relied on here.

Could green-transition money pay for UHC?

A BMJ analysis (Gonçalves and colleagues, BMJ 2026;395:e100890, 21 October 2026) argues that the green energy transition opens a new financing source for UHC — and the scale fits. In 2024, $732.7 billion was spent on fossil fuel subsidies globally, far exceeding the estimated annual financing gap of $20–54 billion required to achieve UHC in low- and middle-income countries during 2026–30. The authors propose a protected share of subsidy-reform, carbon-tax and mineral-royalty revenue ring-fenced for UHC.

Two cases show both the promise and the limits. Indonesia’s 2014–15 reform cut fuel subsidies from 19% of government expenditure in 2014 to under 7% in 2015, helping sustain expansion of the national health insurance scheme (JKN), whose coverage grew from 50% in 2014 to 98% in 2024 — but the price-linking mechanism was suspended in 2017 and subsidies rose sharply again in 2022. Brazil’s 2013 law earmarking 25% of oil royalties for municipal healthcare found no overall effect on health spending or service delivery. The proposal is therefore presented here as it is presented in the BMJ: an argument with evidence, not a proven programme. No country has yet run a ring-fenced green-transition levy for UHC long enough to judge whether it works.

Frequently asked questions

What counts as catastrophic health spending?

Household health spending above 10% — or, on the higher threshold, 25% — of total household expenditure or income. In 2022, 2.1 billion people faced financial hardship from health costs (WHO).

Does universal health coverage mean healthcare is free?

No. It means people get the services they need without financial hardship. Somebody still pays — through taxes, contributions or premiums — and no system covers everything.

Can fossil fuel subsidy reform pay for universal health coverage?

As a proposal, the scale fits: fossil fuel subsidies were $732.7 billion in 2024 against a $20–54 billion annual UHC financing gap. But no country has yet run a ring-fenced reform as a proven programme — the BMJ analysis presents it as an argument with evidence, not a settled fact.