Public spending on health and long-term care in OECD countries will double by 2050, if present trends continue, the Organization of Economic Co-operation and Development reported today.

Such a move would take average health care costs to nearly 13% of GDP compared with 6.7% today. Even if governments manage to contain rising costs, spending would still amount to the equivalent of around 10% of GDP by the middle of the century, it said.

The projections are from a new OECD report that looks at the main factors driving up healthcare spending over the long-term. It finds that apart from the upward pressure on costs due to the demands of older and wealthier populations, government spending on health is growing 1%-point faster than OECD countries’ overall incomes. Advances in medical technology and rapid increases on health services are the main causes. Even where new technology brings down the cost of a treatment, public spending may rise as demand for the treatment increases.

It is these factors, which are not specifically related to ageing populations, that will put the most pressure on health spending over the long term, the paper suggests.

The paper considers two main long-term spending scenarios: the “cost-pressure” scenario assumes that spending continues to grow over and above income growth as it has done in the past; the “cost-containment” scenario imagines that governments take measures to curb this extra spending growth caused by price rises and new technology so that it is eliminated by 2050.

The projections reveal wide differences between countries. In the cost-containment scenario, spending on health and long-term care continues to rise most quickly in countries with rapidly ageing populations such as Italy, Japan and Spain. Sweden, which already spends a relatively high share of GDP on health and long-term care, has the slowest rise in additional spending.