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A Dual-Pressure Model for Healthcare Finance: Comparing United States and African Strategies Under Inflationary Stress
Subject area: Management and Commerce · Area of research: Healthcare Finance
Abstract
Healthcare financing remains a critical determinant of health system resilience, particularly under conditions of economic volatility and inflationary pressure. This paper introduces a dual-pressure model for healthcare finance, designed to compare strategies employed in the United States and selected African nations when confronted with inflationary stress. The model conceptualizes two central pressures: fiscal capacity, which captures the government?s ability to mobilize, allocate, and sustain healthcare resources; and household burden, which reflects the out-of-pocket costs borne by citizens in accessing care. By examining these dual pressures concurrently, the framework highlights systemic trade-offs and identifies points of vulnerability within healthcare financing structures. The United States, with its hybrid model of private insurance, employer contributions, and public programs such as Medicare and Medicaid, demonstrates resilience in fiscal capacity but faces heightened household burden during inflationary cycles due to rising insurance premiums, drug prices, and service costs. Conversely, African countries, particularly those reliant on donor support and constrained public budgets, often display limited fiscal capacity, exacerbating underfunding of essential services. However, community-based and informal financing mechanisms mitigate some household burden, albeit unevenly and unsustainably. Inflation further compounds these disparities by eroding purchasing power, increasing the cost of imported medical supplies, and reducing the real value of public health budgets. Through comparative analysis, the dual-pressure model reveals that the U.S. system exhibits greater capacity to absorb macroeconomic shocks yet disproportionately transfers costs to households, while African strategies struggle with fiscal fragility but demonstrate adaptive community-based mechanisms that partially cushion household burden. The study argues that future resilience requires hybridized approaches: in the U.S., strengthening regulatory mechanisms to reduce household costs, and in Africa, enhancing fiscal space through innovative financing tools, domestic resource mobilization, and inflation-adjusted donor mechanisms. Ultimately, the model provides a diagnostic lens for policymakers to evaluate healthcare finance under inflationary stress and to design more equitable and sustainable strategies.
Keywords
Healthcare Finance, Dual-Pressure Model, United States, Africa, Inflationary Stress, Fiscal Capacity, Household Burden, Resilience, Policy Strategies.
References
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How to cite this paper
@article{1710317,
author = {Temilola Aderonke Onalaja, Priscilla Samuel Nwachukwu, Folake Ajoke Bankole, Tewogbade Lateefat},
title = {A Dual-Pressure Model for Healthcare Finance: Comparing United States and African Strategies Under Inflationary Stress},
journal = {Iconic Research And Engineering Journals},
year = {2019},
volume = {3},
number = {6},
pages = {261-276},
issn = {2456-8880},
url = {https://www.irejournals.com/formatedpaper/1710317.pdf},
abstract = {Healthcare financing remains a critical determinant of health system resilience, particularly under conditions of economic volatility and inflationary pressure. This paper introduces a dual-pressure model for healthcare finance, designed to compare strategies employed in the United States and selected African nations when confronted with inflationary stress. The model conceptualizes two central pressures: fiscal capacity, which captures the government?s ability to mobilize, allocate, and sustain healthcare resources; and household burden, which reflects the out-of-pocket costs borne by citizens in accessing care. By examining these dual pressures concurrently, the framework highlights systemic trade-offs and identifies points of vulnerability within healthcare financing structures. The United States, with its hybrid model of private insurance, employer contributions, and public programs such as Medicare and Medicaid, demonstrates resilience in fiscal capacity but faces heightened household burden during inflationary cycles due to rising insurance premiums, drug prices, and service costs. Conversely, African countries, particularly those reliant on donor support and constrained public budgets, often display limited fiscal capacity, exacerbating underfunding of essential services. However, community-based and informal financing mechanisms mitigate some household burden, albeit unevenly and unsustainably. Inflation further compounds these disparities by eroding purchasing power, increasing the cost of imported medical supplies, and reducing the real value of public health budgets. Through comparative analysis, the dual-pressure model reveals that the U.S. system exhibits greater capacity to absorb macroeconomic shocks yet disproportionately transfers costs to households, while African strategies struggle with fiscal fragility but demonstrate adaptive community-based mechanisms that partially cushion household burden. The study argues that future resilience requires hybridized approaches: in the U.S., strengthening regulatory mechanisms to reduce household costs, and in Africa, enhancing fiscal space through innovative financing tools, domestic resource mobilization, and inflation-adjusted donor mechanisms. Ultimately, the model provides a diagnostic lens for policymakers to evaluate healthcare finance under inflationary stress and to design more equitable and sustainable strategies.},
keywords = {Healthcare Finance, Dual-Pressure Model, United States, Africa, Inflationary Stress, Fiscal Capacity, Household Burden, Resilience, Policy Strategies.},
month = {December},
}