POLICY BRIEF

Innovative Health Financing to Achieve
Global Health and Climate Goals

Achieving the health-related Sustainable Development Goals (SDGs) and addressing the health impacts of climate change require significant, sustained financial investments. Many health systems face chronic underfunding, exacerbated by the increasing demand for universal health coverage (UHC) and the challenges posed by climate-related health risks. Innovative financing mechanisms offer promising solutions to close the resource gaps, support resilient health systems, and promote equity. This Fast-Track Health policy brief explores key strategies for mobilizing resources and aligning health financing with global climate change goals, illustrated through five case studies, and provides recommendations for municipal, national, and regional health authorities.

Social Impact Bonds for UHC in Rwanda: Rwanda pioneered the use of social impact bonds (SIBs) to scale up community health insurance. In this model, private investors funded health system interventions, with repayment tied to measurable outcomes, such as increased insurance enrollment and reduced out-of-pocket expenditures. The initiative improved health coverage rates by 25% over three years and reduced catastrophic health expenditures among vulnerable populations. This case highlights the potential of outcome-based financing to mobilize private capital for public health priorities (WHO, 2022).

Climate-Resilient Health Financing in Fiji: Fiji, frequently affected by climate-related disasters, established a Climate Change and Health Resilience Fund. This national mechanism pooled resources from international donors, climate adaptation grants, and domestic revenues to finance disaster-resilient health infrastructure and emergency response systems. The fund supported the construction of cyclone-resistant health facilities and community-based early warning systems. Fiji’s experience demonstrates how dedicated funds can integrate health and climate resilience efforts (Pacific Health Journal, 2023).

Carbon Taxes for Health in Sweden: Sweden implemented carbon taxes to reduce greenhouse gas emissions and channel a portion of the revenue toward health promotion programs. The funds supported initiatives like urban green spaces, active transportation infrastructure, and public health campaigns on air quality and climate change. This approach resulted in a dual benefit: significant emission reductions and improved population health indicators. The case illustrates how environmental taxation can align health financing with climate action goals (European Public Health Review, 2021).

Debt Swaps for Health in the Philippines: The Philippines utilized a debt-for-health swap mechanism, wherein a portion of its external debt was forgiven in exchange for investing in health system strengthening. The funds were used to expand primary healthcare services in rural areas and to establish mobile clinics for underserved populations. This innovative financing approach improved health outcomes while reducing the country’s debt burden. It underscores the importance of leveraging financial instruments to achieve health equity (Philippines Ministry of Health, 2022).

Green Bonds for Sustainable Health Infrastructure in Brazil: Brazil issued green bonds to finance sustainable health infrastructure projects, including energy-efficient hospitals and solar-powered health centers in remote regions. These investments reduced operational costs, enhanced service delivery, and minimized the carbon footprint of healthcare facilities. The bonds attracted both domestic and international investors, highlighting the appeal of climate-aligned health investments. This case demonstrates the potential of green bonds to address health and climate goals simultaneously (Global Health Financing Forum, 2023).

There are significant challenges associated in health financing, notably in relation to resource mobilization for many low- and middle-income countries struggling to generate sufficient domestic revenue for health financing. Additionally, Innovative financing mechanisms risk excluding marginalized populations if not designed inclusively, creating equity gaps. There are also capacity barriers, including limited technical expertise in designing and implementing complex financing models hinders adoption. Fragmented donor approaches are also creating inefficiencies and duplicate efforts, which requires optimized global coordination. Securing and maintaining political commitment is also a persistent challenge because sustained financing requires long-term political buy-in and cross-sectoral collaboration.

Despite these challenges, there are opportunities for engaging private sector actors in public-private partnerships to expand resource pools and foster innovation. Climate-health integration also presents an opportunity to combine health and climate financing to maximize co-benefits and attract diverse funding sources. Digital health financing, specifically technology-enabled solutions such as mobile payment platforms, have potential to enhance efficiency and transparency. Most important to demonstrate return on health investments, though, are outcome-based models that link investments to measurable health outcomes to action accountability and demonstrate impact. Finally, global collaboration is key to leveraging multilateral platforms enables resource sharing and harmonized efforts toward common health-related goals.