OBJECTIVES: Optimizing the value of pharmaceutical spending is an important goal for effective and sustainable health systems. During the economic crisis, Greece undertook a set of strict fiscal policies to contain public pharmaceutical expenditure. The objective of this study is to investigate the social inefficiencies stemming from the regulatory framework of the Greek health system, with an emphasis on the effects of the policy reforms during the economic crisis on health outcomes.

METHODS: Dynamic econometric models based on time series analysis were used over the period 1970-2018 drawing on the human capital and health production theory. Autoregressive Distributive Lag (ARDL) models are specified to estimate the short- and long-term relationships while testing for stationarity and auto-correlations in the included economic, environmental, employment, health expenditure and health outcome variables.

RESULTS: The implementation of the three memorandum policies in Greece over the crisis period 2009-2018, led to the decrease of public health expenditure by -42%, which coincided with a loss in healthy life years by 3.4 years. The study distinguished further the pre-crisis (1970-2008) and during the crisis (2009-2018) periods, using econometric models. The estimated elasticity of pharmaceutical expenditure on life expectancy during the pre-crisis (1970-2008) period was found positive e= 0.029 (p<0.001), while the corresponding elasticity for the crisis period (2009-2018) was found negative e= - 0.031 (p<0.001). Similar positive and negative coefficients results were for both short- and long-term analysis.

CONCLUSIONS: Health status in Greece was impacted over the last years. Partly due to the reforms during the period of 2009-2018, the population in Greece lost healthy life years and a backwards turning trend was portrayed between life expectancy and pharmaceutical expenditure.