PHSSR Policy Roadmaps for Acting Early on NCDs Synthesis Report 2025

78 Acting early on NCDs The Partnership for Health System Sustainability and ResilienceGermany’s morbidity based risk-adjustment system (Morbi-RSA) helps compensate sickness funds with sicker population, but in doing so it weakens incentives to invest in provention. Because reductions in morbidity can reduce compensation, insurers have little financial motivation to prioritise long-term prevention, especially given annual member switching and scepticism about cost-effectiveness (Medizinischer Dienst Bund & GKV-Spitzenverband, 2024; Reif et al., 2024). This illustrates the difficulty of designing allocation mechanisms that both ensure fair compensation and encourage sustained investment in prevention. POLICY LEVERS: FINANCING The persistent underinvestment in prevention, below 5% across all countries despite proven cost- effectiveness, reveals how budget processes respond to institutional power rather than evidence. Financial barriers remain substantial, while fee-for-service payment systems actively discourage the coordination that NCD management requires. Regional disparities in per capita spending that exceed demographic and epidemiological differences demonstrate how current allocation mechanisms perpetuate rather than address inequities. Without reforms to how health systems value prevention, eliminate financial barriers, and align payment incentives with chronic disease management needs, the economic burden of NCDs will continue escalating. Based on the evidence examined, countries should consider the following approaches to align financing with early action on NCDs: ■ Increase prevention investment through structural reforms Countries need to substantially increase prevention spending from current minimal levels, moving beyond marginal adjustments to meaningful reallocation. This requires transparent systems for tracking prevention investments across all sources rather than the fragmented reporting that currently obscures spending patterns. Prevention budgets should be protected from short-term political pressures through multi-year commitments that reflect the long-term nature of prevention benefits. Investment levels should be determined by population health needs and evidence of effectiveness rather than historical patterns or residual budgeting. ■ Reduce financial barriers to accessing healthcare services through comprehensive protection mechanisms Financial protection must address the full costs of living with chronic conditions, not just basic medical expenses. Countries should minimise out-of-pocket healthcare costs and implement means-tested exemptions to provide enhanced protection for those with chronic conditions. The administrative burden of accessing financial protection needs simplification to avoid excluding those most in need. Regular monitoring of financial protection by socioeconomic status should trigger policy responses when unacceptable disparities emerge. ■ Reform resource allocation to ensure territorial equity Resource allocation formulas need to reflect the true costs of delivering care in different contexts, including social deprivation, infrastructure limitations, and the challenges of serving dispersed populations. Areas facing multiple disadvantages require additional support to achieve equitable outcomes rather than merely equal funding. Central mechanisms should retain flexibility to address persistent inequities that formulaic approaches cannot resolve, recognising that geographic disparities often reflect deep structural disadvantages.