Economics insights into shocks and health system resilience

This chapter takes a fresh look at the concept and application of health system resilience through an economics lens. Health systems show resilience as they prevent, mitigate or even close the profound gaps between demand and supply caused by crises allowing socially optimal outcomes to emerge through the health system. By taking this approach, new insight is provided to some of the core concepts of health system resilience regarding absorptive, adaptive and transformative resilience. In particular transformative resilience is understood as the ability to unlock complex health system rigidities to enhance absorption and adaptation. Furthermore, the landscape of the different types of health system shocks is presented, reviewed and analysed by the particular ways in which each type of shock can severely imbalance the demand for and supply of healthcare leading to problematic health system performance. The causal pathways of influence of each shock are thus outlined as they constrain resources and supply and exacerbate needs and demand. In addition, the impact of existing rationing mechanisms for the management of demand and supply side in normal times is explored in a crisis. This leads to an enhanced understanding of the range of shock-specific strategies that health system resilience must embrace. In addition, the analysis also opens up new lines of inquiry: moving the traditional heath system resilience focus from performance to one of equity (by highlighting where the largest gaps between demand and supply are in a crisis) and exploring how demand- and supply-side dynamics around each shock can help understand, predict and be prepared for subsequent shocks.