Given the importance of health as a cornerstone of sustainable development and the complex relationship between financial resources and health outcomes, this study aims to investigate the dynamic and multidimensional impact of per capita health expenditure on life expectancy at birth on a global scale. This study employs a quantitative-analytical method using a panel data approach. Data from 194 countries over the period 2000-2022 were analyzed using a fixed-effects regression model. This method allows for controlling the unique and time-invariant characteristics of countries while assessing the dynamic relationship between the variables. The cross-sectional analysis confirmed an overall positive relationship, revealing the phenomenon of “diminishing returns on health investment”. However, the key finding from the dynamic panel model presented a different picture: the lagged coefficient of health expenditure was found to be negative and significant. This can be attributed to “reverse causality” (where increased spending is a reaction to health crises) and inefficiencies in resource allocation. Furthermore, the results indicate that a substantial portion of the variance in life expectancy among countries is due to their fixed and structural characteristics rather than annual budgetary fluctuations.