Household health expenditures in Nepal: implications for health care financing reform.

His Majesty's Government of Nepal has embarked on an ambitious social welfare programme of increasing the accessibility of primary education and health care services in rural communities. The implications on the financing of health care services are substantial, as the number of health posts has increased twelve-fold from 1992 to 1996, from 200 to 2597. To strengthen health care financing, government policy-makers are considering a number of financing strategies that are likely to have a substantial impact on household health care expenditures. However, more needs to be known about the role of households in the current structure of the health economy before the government designs and implements policies that affect household welfare. This paper uses the Nepal Living Standards Survey, a rich, nationally-representative sample of households from 1996, to investigate level and distribution of household out-of-pocket health expenditures. Utilization and expenditures for different types of providers are presented by urban/rural status and by socioeconomic status. In addition, the sources of health sector funds are analyzed by contrasting household out-of-pocket expenditures with expenditures by the government and donors. The results indicate that households spend about 5.5% of total household expenditures on health care and that households account for 74% of the total level of funds used to finance the health economy. In addition, rural households are found to spend more on health care than urban households, after controlling for income status. Distributing health care expenditures by type of care utilized indicates that the wealthy, as well as the poor, rely heavily on services provided by the public sector. The results of this analysis are used to discuss the feasibility of implementing alternative health care financing policies.     

Comparative quality of private and public health services in rural Vietnam

BACKGROUND: Private health care services were officially recognized in Vietnam in 1989, and for the last 15 years have competed with the public health system in providing primary curative care and pharmaceutical sales to rural populations. However, the quality of these private and public health care services has not been evaluated and compared. METHODS: A community-based survey was conducted in 30 of the 160 communes in Hung Yen, which were selected by probability proportional to population size (PPS) sampling. All commune health centres (CHCs) and private health care providers in the selected communes were surveyed on human resources, services provided, availability of medical equipment and pharmaceuticals, knowledge and clinical performance for acute and chronic problems. Patient satisfaction and cost of care associated with recent illness were measured using a random household survey covering 30 households from each of the selected communes. RESULTS: There were 11.5 private providers per 10,000 population, compared with 6.7 public providers per 10,000. A quarter of private providers were employees of the public health sector. Less than 20% of the private providers had registered their practice with the government system. Eleven per cent (26/234) had no professional qualifications. Fifty-eight per cent (135/234) provided treatment as well as selling medications. Public sector infrastructure was superior to that of the private providers. The quality of services provided by public providers was poor but significantly better than that of private providers. Patient satisfaction and costs of care were similar between the two groups. CONCLUSIONS: Private providers are successfully competing with the public health centre system in rural areas but not because they provide cheaper or better services. The quality of private health care services is not controlled and is significantly poorer than public services. Current practice in both systems falls below the national standard, especially for the management of chronic health problems. The low quality of health care services at a community level may help explain the previously observed phenomena of high levels of self-medicating, low utilization of commune health centres and over-utilization of tertiary health care facilities.     

Private sector, human resources and health franchising in Africa

In much of the developing world, private health care providers and pharmacies are the most important sources of medicine and medical care and yet these providers are frequently not considered in planning for public health. This paper presents the available evidence, by socioeconomic status, on which strata of society benefit from publicly provided care and which strata use private health care. Using data from The World Bank's Health Nutrition and Population Poverty Thematic Reports on 22 countries in Africa, an assessment was made of the use of public and private health services, by asset quintile groups, for treatment of diarrhoea and acute respiratory infections, proxies for publicly subsidized services. The evidence and theory on using franchise networks to supplement government programmes in the delivery of public health services was assessed. Examples from health franchises in Africa and Asia are provided to illustrate the potential for franchise systems to leverage private providers and so increase delivery-point availability for public-benefit services. We argue that based on the established demand for private medical services in Africa, these providers should be included in future planning on human resources for public health. Having explored the range of systems that have been tested for working with private providers, from contracting to vouchers to behavioural change and provider education, we conclude that franchising has the greatest potential for integration into large-scale programmes in Africa to address critical illnesses of public health importance.     

Household utilization and expenditure on private and public health services in Vietnam

The private provision of health services in Vietnam was legalized in 1989 as one of the country's means to mobilize resources and improve efficiency in the health system. Ten years after its legalization, the private sector has widely expanded its activities and become an important provider of health services for the Vietnamese people. However, little is known about its contribution to the overall objectives of the health system in Vietnam. This paper assesses the role of the private health care provider by examining utilization patterns and financial burden for households of private, as compared with public, services. We found that the private sector provided 60% of all outpatient contacts in Vietnam. There was no difference by education, sex or place of residence in the use of private ambulatory health care. Although there was evidence suggesting that rich people use private care more than the poor, this finding was not consistent across all income groups. The private sector served young children in particular. Also, people in households with several sick members at the same time relied more on private than public care, while those with severe illnesses tended to use less private care than public. The financial burden for households from private health care services was roughly a half of that imposed by the public providers. Expenditure on drugs accounted for a substantial percentage of household expenditure in general and health care expenditure in particular. These findings call for a prompt recognition of the private sector as a key player in Vietnam's health system. Health system policies should mobilize positive private sector contributions to health system goals where possible and reduce the negative effects of private provision development.     

The effect of wealth status on care seeking and health expenditures in Afghanistan

This paper analyses the effect of wealth status on care-seekingpatterns and health expenditures in Afghanistan, based on anational household survey conducted within public health facilitycatchment areas. We found high rates of reported care-seeking,with more than 90% of those ill seeking care. Sick individualsfrom all wealth quintiles had high rates of care-seeking, althoughthose in the wealthiest quintile were more likely to seek carethan those from the poorest (odds ratio 2.2; 95% CI 1.6, 3.0).The nearest clinic providing the government's Basic Packageof Health Services (BPHS) was the most commonly sought firstprovider (53% overall), especially for relatively poor households(62% in poorest vs. 42% in least poor quintile, P < 0.0001).Sick individuals from wealthier quintiles used hospitals andfor-profit private providers more than those in poorer quintiles.Multivariate analysis showed that wealth quintile was the strongestpredictor of seeking care, and of going first to private providers.More than 90% of those seeking care paid money out-of-pocket.Mean (median) expenditures among those paying for care in theprevious month were 873 Afghanis (200 Afghanis), equivalentto US$17.5 (US$4). Expenditures were lowest at BPHS clinicsand highest at private providers. Financing care through borrowingmoney or selling assets/land (‘any distress’ financing)was reported in nearly 30% of cases and was almost twice ashigh among households in the poorest versus the least poor quintile(P < 0.0001). Financing care through selling assets/land(‘severe distress’ financing) was less common (10%overall) and did not differ by wealth status. These findingsindicate that BPHS facilities are being used by the poor wholive close to them, but further research is needed to assessutilization among populations in more remote areas. The highout-of-pocket health expenditures, particularly for privatesector services, highlight the need to develop financial protectionmechanisms in Afghanistan.     

Catastrophic and poverty impacts of health payments: results from national household surveys in Thailand

OBJECTIVE: To estimate the incidence and describe the profile of catastrophic expenditures and impoverishment due to household out-of-pocket payments, comparing the periods before and after the introduction of universal health care coverage (UC). METHODS: Secondary data analyses of socioeconomic surveys on nationally representative households pre-UC in 2000 (n = 24,747) and post-UC in 2002 (n = 34,785) and 2004 (n = 34,843). FINDINGS: Households using inpatient care experienced catastrophic expenditures most often (31.0% in 2000, compared with 15.1% and 14.6% in 2002 and 2004, respectively). During the two post-UC periods, the incidence of catastrophic expenditures for inpatient services at private hospitals was 32.1% for 2002 and 27.8% for 2004. For those using inpatient care at district hospitals, the corresponding catastrophic expenditures figures were 6.5% and 7.3% in 2002 and 2004, respectively. The catastrophic expenditures incidence for outpatient services from private hospitals moved from 27.9% to 28.5% between 2002 and 2004. In 2000, before universal coverage was introduced, the percentages of Thai households who used private hospitals and faced catastrophic expenditures were 35.8% for inpatient care and 36.0% for outpatient care. Impoverishment increased for poor households because of payments for inpatient services by 84.0% in 2002, by 71.5% in 2004 and by 95.6% in 2000. The relative increase in out-of-pocket impoverishment was found in 98.8% to 100% of those who were poor following payments made to private hospitals, regardless of type of care. CONCLUSION: Households using inpatient services, especially at private hospitals, were more likely to face catastrophic expenditures and impoverishment from out-of-pocket payments. Use of services not covered by the UC benefit package and bypassing the designated providers (prohibited under the capitation contract model without proper referrals) are major causes of catastrophic expenditures and impoverishment.     

Why the poor pay more: household curative expenditures in rural Sierra Leone

This paper draws on data from Sierra Leone, and secondary data from elsewhere, to show that the rural poor can be disproportionately disadvantaged by user charges for health care, paying a higher percentage of their incomes for health care than wealthier households. Cost sharing systems at primary care level should include exemptions for the poor, but rarely succeed in consistently protecting them. The regressivity of health expenditures also results from lack of protection from the higher costs of less-frequently used, expensive providers. In Sierra Leone, the burden of curative treatment costs for all groups came mainly from private and NGO providers. Proximity to facilities appeared a more important factor in their use than average price levels. Even if a perfect exemption system existed at government primary care facilities, it would not have had much overall effect because of their relatively small contribution to household health expenditures. The financial burden on households could be relieved by making basic health facilities more accessible and at hospital level using additional resources generated through improved efficiency and cross-subsidization to provide exemptions. Also, pricing policy should take into account local economic conditions. Insurance/prepayment schemes covering the cost of hospitalization would come closer to an ideal solution, but have been implemented in very few of the poorer countries.     

Impact of healthcare reforms on out-of-pocket health expenditures in Turkey for public insurees

The Turkish healthcare system has been subject to major reforms since 2003. During the reform process, access to public healthcare providers was eased and private providers were included in the insurance package for public insurees. This study analyzes data on out-of-pocket (OOP) healthcare expenditures to look into the impact of reforms on the size of OOP health expenditures for premium-based public insurees. The study uses Household Budget Surveys that provide a range of individual- and household-level data as well as healthcare expenditures for the years 2003, before the reforms, and 2006, after the reforms. Results show that with the reforms ratio of households with non-zero OOP expenditure has increased. Share and level of OOP expenditures have decreased. The impact varies across income levels. A semi-parametric analysis shows that wealthier individuals benefited more in terms of the decrease in OOP health expenditures.     

Analysis of reproductive health expenditures in Mexico, 2003]

OBJECTIVES: To estimate reproductive health expenditures in Mexico during 2003; analyze how costs were distributed across the main programs, funding entities, and providers of health goods and services; and evaluate the relationship between reproductive health expenditures and economic indicators in different states, using health accounts methods. METHODS: We estimated reproductive health expenditures between January and December 2003, at the national and state level. We used health accounts methods adjusted for the particular characteristics of Mexico on the basis of information from public and private sources. Expenditures were calculated for the four main reproductive health programs (maternal-perinatal health, family planning, cervical and uterine cancer, and breast cancer) according to different funding entities, goods and services providers, and functions of health care, in both the public and private sector. We estimated public expenditures by state per beneficiary, and analyzed how these costs were related with pubic health care expenditures and annual per capita gross domestic product (GDP) for each state. RESULTS: The reproductive health expenditures in Mexico during the year 2003 were US$ 2.912 6 billion, a figure that represented 0.5% of the national GDP in 2003 and slightly more than 8% of the total health care expenditures. Costs were higher for public entities (53.5%) than for private entities (46.5%). The maternal-perinatal health program accounted for the highest costs, mainly from deliveries and complications; direct payments from households accounted for nearly 50% of the total figure. Costs for family planning were accrued mainly in the public sector, and represented 5.9% of the total expenditure. Of the total spending on reproductive health, 7.9% was devoted to cervical and uterine cancer and breast cancer programs. Mean public expenditures on reproductive health per beneficiary were US$ 680.03, and differences between states were associated with differences in public health expenditures (r=0.80; P<0.001) and per capita GDP (r=0.75; P<0.0001). CONCLUSIONS: The health accounts method allowed us to estimate reproductive health expenditures in Mexico in 2003. Enhancing reproductive health actions and programs by basing expenditure assignments on evidence and focusing on least-favored populations is an ethical, human rights, and developmental imperative.     

Private Care and Public Health: Do Vaccination and Prenatal Care Rates Differ between Users of Private versus Public Sector Care in India?

Objective. To determine whether patients who use private sector providers for curative services have lower vaccination rates and are less likely to receive prenatal care.
Data Sources/Study Setting. This study uses data from the 52d round of the National Sample Survey, a nationally representative socioeconomic and health survey of 120,942 rural and urban Indian households conducted in 1995–1996.
Study Design. Using logistic regression, we estimate the relationship between receipt of preventive care at any time (vaccinations for children, prenatal care for pregnant women) and use of public or private care for outpatient curative services, controlling for demographics, household socioeconomic status, and state of residence.
Data Collection/Extraction Methods. We analyzed samples of children ages 0 to 4 and pregnant women who used medical care within a 15-day window prior to the survey.
Principal Findings. With the exception of measles vaccination, predicted probabilities of the receipt of vaccinations and prenatal care do not differ based on the type of provider at which children and women sought curative care. Children and pregnant women in households who use private care are almost twice as likely to receive preventive care from private sources, but the majority still obtains preventive care from public providers.
Conclusions. We do not find support for the hypothesis that children and pregnant women who use private care are less likely to receive public health services. Results are consistent with the notion that Indian households are able to successfully navigate the coexisting public and private systems, and obtain services selectively from each. However, because the study employed an observational, cross-sectional study design, findings should be interpreted cautiously.     

Income-based disparities in health care utilisation under universal health coverage in Brazil, 2002–2003

Since Brazil's adoption of universal health care in 1988, the country's health care system has consisted of a mix of private providers and free public providers. We test whether income-based disparities in medical visits and medications remain in Brazil despite universal coverage using a nationally representative sample of over 48,000 households. Additional income is associated with less public sector utilisation and more private sector utilisation, both using simple correlations and regressions controlling for household characteristics and local area fixed effects. Importantly, the increase in private care use is greater than the drop in public care use. Also, income and unmet medical needs are negatively associated. These results suggest that access limitations remain for low-income households despite the availability of free public care.     

Primary health concept revisited: where do people seek health care in a rural area of Vietnam?

The government of Vietnam is committed to promote and secure equity in access to health care for all citizens. The current rapid changes towards a market economy may challenge the government's wish for maintaining equity, especially for low income and vulnerable groups. The aim of this study was to investigate aspects of access and utilisation of health care of rural people. The study included a random sample of 1075 out of the 11,547 households in the Field Laboratory in Bavi district, northern Vietnam and a structured questionnaire was used. The results indicate that self-treatment is common practice and private providers are an important source of health services not only for those who are better off but also for poor households. The costs for health care are substantial for households, and lower income groups spent a significantly higher proportion of their income on health care than the rich did. The poor are deterred from seeking health care more often than the rich and for financial reason. As regards sources for payments, the poor relied much more on borrowing money to pay for their health care needs, while those who are better off relied mostly on household savings. A burden of high cost for treatment implies high risks for families to fall into a 'medical poverty trap'. Our findings suggest a need for developing risk-sharing schemes (co-payment, pre-payment and insurance), and appropriate allocation of scarce public resources. We suggest that the private health care sector needs both support and regulations to improve the quality and access to health care by the poor.     

The Burden of Maternal Health Care Expenditure in India: Multilevel Analysis of National Data

To quantify the economic burden of maternal health care services on Indian households and examine the levels of expenditure incurred in public and private health care institutions at the national, state and community levels. Cross-sectional population data from the 2004 National Sample Survey Organisation were used, which considered 9,643 households for the analysis where at least one woman received maternal health care services during the year preceding the survey. Multilevel linear regression techniques were used to estimate the effect of household, cluster and state characteristics on the proportion of maternal health care expenditures over total household expenditures. Over 80 % of households reported paying for maternal health care services, with those using private care facilities paying almost 4 times more than those using public facilities. Multilevel analyses show evidence of high burden of maternal health care expenditures, which varied significantly across states according to the level of health care utilisation, and with considerable heterogeneity at the household and community levels. Maternal health care services in India are offered free at the point of delivery, yet many families face significant out-of-pocket expenditures. The recent governmental policy interventions to encourage institutional births by providing nominal financial assistance is a welcome step but this might not help to compensate mothers for other indirect expenditures, especially those living in rural areas and poorer communities who are increasingly seeking care in private facilities.     

Out of pocket health expenditures in Turkey following introduction of co-payments along with improved primary care services

In 2002, Turkey started to implement reforms in health care aiming to improve access and increase efficiency. Reforms increased health insurance coverage and resulted in higher number of outpatient and inpatient treatments at both public and private hospitals. Later, to change preference towards the use of secondary and tertiary care over primary care and rein in increasing health expenditures, a series of co-payments were instituted along with an extension of primary care services through a family-medicine system that provided free access to all. This work aims to measure the impact of these two simultaneous policy measures on out-of-pocket expenditures. We find that while contributory payments resulted in higher OOP health expenditures, especially for lower income households, the impact was small. We also observe that inability to consult a physician and to visit a hospital, especially for monetary reasons, was reduced after the policy change.     

The Current and Projected Taxpayer Shares of US Health Costs

Objectives. We estimated taxpayers’ current and projected share of US health expenditures, including government payments for public employees’ health benefits as well as tax subsidies to private health spending.Methods. We tabulated official Centers for Medicare and Medicaid Services figures on direct government spending for health programs and public employees’ health benefits for 2013, and projected figures through 2024. We calculated the value of tax subsidies for private spending from official federal budget documents and figures for state and local tax collections.Results. Tax-funded health expenditures totaled $1.877 trillion in 2013 and are projected to increase to $3.642 trillion in 2024. Government’s share of overall health spending was 64.3% of national health expenditures in 2013 and will rise to 67.1% in 2024. Government health expenditures in the United States account for a larger share of gross domestic product (11.2% in 2013) than do total health expenditures in any other nation.Conclusions. Contrary to public perceptions and official Centers for Medicare and Medicaid Services estimates, government funds most health care in the United States. Appreciation of government’s predominant role in health funding might encourage more appropriate and equitable targeting of health expenditures.The United States has the world’s highest per capita health care costs—about double those of other wealthy nations.1 According to both official figures and public perception, most health care funding in the United States comes from private payers. For instance, the Centers for Medicare and Medicaid Services (CMS) estimates that federal, state, and local governments accounted for 43% of health expenditures in 2013.2These official figures reflect an accounting framework based on who wrote the final check as money flowed from households or employers to health care providers, and exclude many indirect government health expenditures. Thus, when government pays for veterans’ care, CMS classifies it as a public expenditure because government writes the checks that fund the Veterans Health Administration. But CMS classifies government-paid health benefits for senators or Federal Bureau of Investigation agents as “private” expenditures because a private insurer pays the claims. Moreover, the tax subsidies that fund a significant share of private health expenditures (e.g., private-employer spending) are not counted by CMS as government health spending, although the Office of Management and Budget (OMB) tabulates these subsidies as “tax expenditures” in official budget documents.3In a previous study, we estimated that the public share of US health spending—after inclusion of these tax subsidies and government payments for public employees’ health benefits—amounted to 59.8% of the total in 1999, nearly double the 1965 figure.4 The current study provides detailed estimates of direct and indirect government health spending in 2013, as well as projected figures through 2024.     

Have out‐of‐pocket health care payments risen under free health care policy? The case of Sri Lanka

Compared to its neighbors, Sri Lanka performs well in terms of health. Health care is provided for free in the public sector, yet households' out‐of‐pocket health expenditures are steadily increasing. We explore whether this increase can be explained by supply shortages and insufficient public health care financing or whether it is rather the result of an income‐induced demand for supplementary and higher quality services from the private sector. We focus on total health care expenditures and health care expenditures for specific services such as expenses on private outpatient treatments and expenses on laboratory and other diagnostic services. Overall, we find little indication that limited supply of public health care per se pushes patients into the private sector. Yet income is identified as one key driver of rising health care expenditures, ie, as households get richer, they spend an increasing amount on private services suggesting a dissatisfaction with the quality offered by the public sector. Hence, quality improvements in the public sector seem to be necessary to ensure sustainability of the public health care sector. If the rich and the middle class increasingly opt out of public health care, the willingness to pay taxes to finance the free health care policy will certainly shrink.     

The tradeoff between centralized and decentralized health services: Evidence from rural areas in Mexico

This study investigates the effectiveness of centralized and decentralized health care providers in rural Mexico. It compares provider performance since both centralized and decentralized providers co-exist in rural areas of the country. The data are drawn from the 2003 household survey of Oportunidades, a comprehensive study of rural families from seven states in Mexico. The analyses compare out-of-pocket health care expenditures and utilization of preventive care among rural households with access to either centralized or decentralized health care providers. This study benefits from differences in timing of health care decentralization and from a quasi-random distribution of providers. Results show that overall centralized providers perform better. Households served by this organization report less regressive out-of-pocket health care expenditures (32% lower), and observe higher utilization of preventive services (3.6% more). Decentralized providers that were devolved to state governments in the early 1980s observe a slightly better performance than providers that were decentralized in the mid-1990s. These findings are robust to decentralization timing, heterogeneity in per capita government health expenditures, state and health infrastructure effects, and other confounders.     

The allure of the private practitioner: is this the only alternative for the urban poor in India?

The main objective of the study has been to identify trajectories of health seeking behaviour of the urban poor, particularly their use of the private health sector, with the aim to identify strategies to improve quality of health care for this burgeoning population. This article presents findings from a slum settlement in Delhi where ethnographic sub-studies were carried out over two years among private health providers and selected households alongside a survey of household expenditure patterns. The primary research tools were in-depth interviews with practitioners and key informants as well as observations of clinical interactions. Illness narratives and case studies were documented over two years. The software package q.s.r. Nvivo was used for coding and content analysis. It was found that almost 90% of the respondents exclusively depend on local unlicensed and unregistered practitioners for basic primary health care. Long distances, time-consuming procedures, rude behaviour and, in many cases, bribes that had to be paid to staff in the hospitals were cited as major deterrents to utilising government facilities. Despite the public health consequences of inappropriate treatment protocols and misuse of drugs by these untrained private providers, in the absence of a structured urban primary health care system in the country, they seem to be the only alternative for the burgeoning urban poor in vast metros such as Delhi.     

Financial protection of patients through compensation of providers: The impact of Health Equity Funds in Cambodia

Public providers have no financial incentive to respect their legal obligation to exempt the poor from user fees. Health Equity Funds (HEFs) aim to make exemptions effective by giving NGOs responsibility for assessing eligibility and compensating providers for lost revenue. We use the geographic spread of HEFs over time in Cambodia to identify their impact on out-of-pocket (OOP) payments. Among households with some OOP payment, HEFs reduce the amount paid by 35%, on average. The effect is larger for households that are poorer and mainly use public health care. Reimbursement of providers through a government operated scheme also reduces household OOP payments but the effect is not as well targeted on the poor. Both compensation models raise household non-medical consumption but have no impact on health-related debt. HEFs reduce the probability of primarily seeking care in the private sector.     

Transitions from private to public health coverage among children: estimating effects on out-of-pocket medical costs and health insurance premium costs

Objective. To assess the effects of transitions from private to public health insurance by children on out‐of‐pocket medical expenditures and health insurance premium costs. Data Sources. Data are drawn from the 1996 and 2001 panels of the Survey of Income and Program Participation. We construct a nationally representative, longitudinal sample of children, ages 0–18, and their families for the period 1998–2003, a period in which states raised public health insurance eligibility rates for children. Study Design. We exploit the Survey of Income and Program Participation's longitudinal design to identify children in our sample who transition from private to public health insurance. We then use a bootstrapped instrumental variable approach to estimate the effects of these transitions on out‐of‐pocket expenditures and health insurance premium costs. Principal Findings. Children who transition from private to public coverage are relatively low‐income, are disproportionately likely to live in single‐mother households, and are more likely to be Black or of Hispanic origin. Child health status is highly predictive of transitions. We estimate that these transitions provide a cash‐equivalent transfer of nearly U.S.$1,500 annually for families in the form of reduced out‐of‐pocket and health insurance premium costs. Conclusions. Transitions from private to public health coverage by children can bring important social benefits to vulnerable families. This suggests that instead of being a net societal cost, such transitions may provide an important social benefit.