Coping with out-of-pocket health payments: empirical evidence from 15 African countries

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Abstract

OBJECTIVE: To explore factors associated with household coping behaviours in the face of health expenditures in 15 African countries and provide evidence for policy-makers in designing financial health protection mechanisms. METHODS: A series of logit regressions were performed to explore factors correlating with a greater likelihood of selling assets, borrowing or both to finance health care. The average partial effects for different levels of spending on inpatient care were derived by computing the partial effects for each observation and taking the average across the sample. Data used in the analysis were from the 2002-2003 World Health Survey, which asked how households had financed out-of-pocket payments over the previous year. Households selling assets or borrowing money were compared to those that financed health care from income or savings. Those that used insurance were excluded. For the analysis, a value of 1 was assigned to selling assets or borrowing money and a value of 0 to other coping mechanisms. FINDINGS: Coping through borrowing and selling assets ranged from 23% of households in Zambia to 68% in Burkina Faso. In general, the highest income groups were less likely to borrow and sell assets, but coping mechanisms did not differ strongly among lower income quintiles. Households with higher inpatient expenses were significantly more likely to borrow and deplete assets compared to those financing outpatient care or routine medical expenses, except in Burkina Faso, Namibia and Swaziland. In eight countries, the coefficient on the highest quintile of inpatient spending had a P-value below 0.01. CONCLUSION: In most African countries, the health financing system is too weak to protect households from health shocks. Borrowing and selling assets to finance health care are common. Formal prepayment schemes could benefit many households, and an overall social protection network could help to mitigate the long-term effects of ill health on household well-being and support poverty reduction.

Translated abstract

OBJECTIF: Etudier les facteurs associés au comportement des ménages face aux dépenses de santé dans 15 pays d'Afrique et fournir des éléments aux décideurs politiques pour concevoir des mécanismes de protection financière dans le domaine de la santé. MÉTHODES: Une série de régressions logit ont été pratiquées pour étudier les facteurs corrélés à une plus grande probabilité de vente de biens, d'emprunt ou de réalisation de ces deux opérations pour financer des soins de santé. Les effets partiels moyens pour différents niveaux de dépenses de soins hospitaliers ont été obtenus en déterminant les effets partiels pour chaque observation et en calculant la moyenne sur l'échantillon. Les données utilisées pour l'analyse étaient tirées de l'Enquête sur la santé dans le monde 2002-2003, qui avait recueilli des informations auprès des ménages sur la façon dont ils avaient financé les dépenses de santé à leur charge pendant l'année précédente. Les ménages ayant vendu des biens ou emprunté de l'argent ont été comparés à ceux ayant financé leurs dépenses de santé à partir de leurs revenus ou de leurs économies. Ceux ayant fait appel à une assurance ont été exclus. Aux fins de l'analyse, une valeur de 1 a été affectée à la vente de biens ou à un emprunt financier et une valeur de 0 au recours à d'autres mécanismes pour faire face aux dépenses. RÉSULTATS: La proportion des ménages ayant réglé leurs dépenses de santé par un emprunt ou la vente de biens allait de 23 % en Zambie à 68 % au Burkina Faso. En général, les groupes disposant des plus hauts revenus avaient une probabilité moindre d'emprunter ou de vendre des biens. En revanche, les mécanismes de réponse aux dépenses de santé variaient peu entre les quintiles de revenus inférieurs. Les ménages confrontés à des dépenses hospitalières importantes avaient une probabilité nettement plus forte d'emprunter ou d'appauvrir leurs actifs que ceux finançant des soins ambulatoires ou médicaux de routine, sauf au Burkina Faso, en Namibie et au Swaziland. Dans huit pays, pour le coefficient associé au quintile de dépenses hospitalières le plus élevé, on avait p < 0,01. CONCLUSION: Dans la plupart des pays africains, le système de financement des dépenses de santé est trop faible pour protéger les ménages des dépenses catastrophiques. Le recours à l'emprunt ou à la vente de biens pour financer les soins de santé est une pratique courante. Des systèmes de prépaiement formels seraient utiles à de nombreux ménages et un réseau de protection sociale global pourrait contribuer à atténuer les effets à long terme de la mauvaise santé sur le bien-être des foyers et à réduire la pauvreté.

Translated abstract

OBJETIVO: Estudiar los factores asociados a los comportamientos adoptados por los hogares para afrontar los gastos sanitarios en 15 países africanos, y aportar a las instancias normativas datos probatorios que les permitan formular mecanismos de protección financiera de la salud. MÉTODOS: Se realizaron regresiones logit para estudiar los factores correlacionados con una mayor probabilidad de vender bienes, pedir préstamos o ambas cosas para financiar la atención de salud. Los efectos parciales medios para diferentes niveles de gasto en atención hospitalaria se determinaron calculando los efectos parciales para cada observación y considerando la media de la muestra. Los datos usados en el análisis proceden de la Encuesta Mundial de Salud 2002-2003, en la que se preguntaba cómo habían financiado los hogares los pagos directos durante el último año. Los hogares que vendieron bienes o adquirieron préstamos se compararon con los que pudieron financiar la atención de salud con sus ingresos o ahorros. No se incluyó en el estudio a los que estaban asegurados. A efectos de este análisis, se asignó un valor de 1 a los que vendieron bienes o se endeudaron, y un valor de cero a los que afrontaron la situación mediante otros mecanismos. RESULTADOS: Entre un 23% (Zambia) y un 68% (Burkina Faso) de los hogares vendieron bienes o pidieron dinero prestado. En general, los grupos con mayores ingresos fueron los que menos recurrieron a esas opciones, pero los mecanismos de afrontamiento no diferían de forma marcada entre los quintiles de ingresos inferiores. Entre los hogares con mayores gastos hospitalarios se observó una tendencia significativamente mayor a pedir préstamos y vender bienes en comparación con quienes tuvieron que financiar atención ambulatoria o gastos médicos corrientes, exceptuando los casos de Burkina Faso, Namibia y Swazilandia. En ocho países, el coeficiente para el quintil superior de los gastos en atención hospitalaria presentaba un valor de p inferior a 0,01. CONCLUSIÓN: En la mayoría de los países africanos, el sistema de financiación sanitaria es demasiado débil para proteger a los hogares de los problemas críticos de salud. La petición de préstamos y la venta de bienes para financiar la atención de salud son reacciones frecuentes en esos casos. Unos sistemas formales de prepago podrían beneficiar a muchos hogares, y una red general de protección social podría ayudar a atenuar los efectos que la mala salud tiene a largo plazo en el bienestar doméstico, así como a reducir la pobreza.

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Household catastrophic health expenditure: a multicountry analysis.

Christopher Murray, Lewis Evans, J Klavus … (2003)

Health policy makers have long been concerned with protecting people from the possibility that ill health will lead to catastrophic financial payments and subsequent impoverishment. Yet catastrophic expenditure is not rare. We investigated the extent of catastrophic health expenditure as a first step to developing appropriate policy responses. We used a cross-country analysis design. Data from household surveys in 59 countries were used to explore, by regression analysis, variables associated with catastrophic health expenditure. We defined expenditure as being catastrophic if a household's financial contributions to the health system exceed 40% of income remaining after subsistence needs have been met. The proportion of households facing catastrophic payments from out-of-pocket health expenses varied widely between countries. Catastrophic spending rates were highest in some countries in transition, and in certain Latin American countries. Three key preconditions for catastrophic payments were identified: the availability of health services requiring payment, low capacity to pay, and the lack of prepayment or health insurance. People, particularly in poor households, can be protected from catastrophic health expenditures by reducing a health system's reliance on out-of-pocket payments and providing more financial risk protection. Increase in the availability of health services is critical to improving health in poor countries, but this approach could raise the proportion of households facing catastrophic expenditure; risk protection policies would be especially important in this situation.

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What are the economic consequences for households of illness and of paying for health care in low- and middle-income country contexts?

Diane McIntyre, Michael Thiede, Göran Dahlgren … (2006)

This paper presents the findings of a critical review of studies carried out in low- and middle-income countries (LMICs) focusing on the economic consequences for households of illness and health care use. These include household level impacts of direct costs (medical treatment and related financial costs), indirect costs (productive time losses resulting from illness) and subsequent household responses. It highlights that health care financing strategies that place considerable emphasis on out-of-pocket payments can impoverish households. There is growing evidence of households being pushed into poverty or forced into deeper poverty when faced with substantial medical expenses, particularly when combined with a loss of household income due to ill-health. Health sector reforms in LMICs since the late 1980s have particularly focused on promoting user fees for public sector health services and increasing the role of the private for-profit sector in health care provision. This has increasingly placed the burden of paying for health care on individuals experiencing poor health. This trend seems to continue even though some countries and international organisations are considering a shift away from their previous pro-user fee agenda. Research into alternative health care financing strategies and related mechanisms for coping with the direct and indirect costs of illness is urgently required to inform the development of appropriate social policies to improve access to essential health services and break the vicious cycle between illness and poverty.