A variety of factors, including disease burden, system priorities, organisational aspects, and costs, determine the allocation of resources across different types of healthcare services. In EU countries, curative and rehabilitative care services constitute the bulk of health spending, primarily delivered through inpatient and outpatient services, which accounted for nearly 60% of all health expenditures in 2022. About one‑fifth of health spending is directed toward medical goods (mostly pharmaceuticals), followed by 15% on health-related long-term care. The remaining 9% is spent on collective services such as prevention and public health, as well as the administration of healthcare systems (Figure 5.7).
Inpatient care involves a formal admission into a healthcare facility, usually a hospital, for treatment expected to require an overnight stay. In 2022, Cyprus, Romania and Greece reported the highest share of total health spending allocated to inpatient services at around 40%. In contrast, Nordic countries such as Finland and Sweden along with the Netherlands, allocated much less to inpatient services – about 20% of overall health spending.
Outpatient care includes services provided to patients who are not formally admitted to a facility and do not stay overnight, and encompasses generalist and specialist outpatient services, dental care, homecare, and ancillary services. Spending on outpatient care services made up around 45% of all health spending in Portugal, Latvia, Estonia and Finland, compared to an EU average of 29%. On the other end of the scale, Romania and Bulgaria allocated less than a fifth of their health spending to outpatient care.
Retail medical goods (mainly pharmaceuticals) consumed in outpatient settings represent the third largest category of spending. In 2022, the highest share of medical goods spending was observed in Bulgaria, the Slovak Republic and Greece, where it constituted up to a third of health spending. In contrast, Denmark, Ireland and the Netherlands spent only around 10% of their total health expenditures on medical goods.
Spending on long-term care services accounted for 15% of total health spending on average in 2022 across EU countries. The Netherlands, Sweden and Norway – countries with well-established formal long-term care systems – allocated more than a quarter of their health spending to long-term care in 2022. Spending on long-term care was lowest in the Slovak Republic, Greece, Cyprus and Croatia, suggesting the reliance on more informal care arrangements in those countries.
The COVID‑19 pandemic changed health spending patterns to some degree. Figure 5.8 compares the average annual per capita spending growth rates for key services for the years 2015‑19 with 2019‑22 across the EU. While average annual spending growth of preventive services increased substantially during the pandemic, for a number of healthcare services including outpatient care and long-term care year-on-year spending growth rates in pre‑COVID‑19 years were above those recorded throughout the pandemic. Little change can be observed for spending on inpatient care and pharmaceuticals. Their average annual growth rates before and during the pandemic were similar.
In the years preceding the COVID‑19 crisis, annual spending growth rates were relatively stable and averaged 1‑2% per year for pharmaceuticals, while annual increases for long-term care, outpatient care, and prevention stood at 4% or more. On the other hand, the compound annual growth rates during the pandemic hide some important fluctuation between years. Notably, spending on preventive care surged by an average of 50% in 2020 and 2021 as countries allocated significant resources to testing, tracing, surveillance, public information campaigns, and vaccination rollouts. However, this increase was short-lived, with spending on prevention contracting by nearly 20% in 2022. As a result, the share of total health spending allocated to prevention was more than 4% in 2022, up from slightly less than 3% in 2019. Likewise, growth in inpatient care spending reached 9% in 2020 across the EU due to COVID‑19‑related expenditures, before returning to pre‑pandemic levels in 2022. For outpatient care, spending growth was stagnating in 2020 but jumped to 10% in 2021, due to deferrals of visits to outpatient facilities in 2020, before dropping again in 2022. Long-term care and pharmaceutical spending increased slightly during the pandemic as care homes faced higher costs (e.g. for infection control measures, staff illness), and governments purchased COVID‑19 masks and personal protective equipment. However, spending growth significantly contracted in 2022 for both functions.
