Impacts at national level: Effects on health, poverty and employment resulting in economic

Universal Health Protection 23 Figure 3.15. Poverty levels before and after catastrophic health expenditure, selected East European and Central Asian countries, 2010 Note: Data from most recent household survey, poverty line used is US2.15 at 2000 PPP. Source: World Bank, 2010a. In Asia, households in Cambodia are among those experiencing the highest OOP in the region. In any given month during 2007, medical spending pushed 4.1 per cent of households below the poverty line. Also during this year, 5.6 per cent of families were forced to spend more than 25 per cent of their household income on medical treatment costs, indicating that, in addition to its severity, the frequency of OOP was high Anuranga et al., 2012. Research in Bangladesh has shown that the burden of OOP is spread unevenly over different income groups figure 3.16. In absolute terms, those households most well-off spent significantly more on OOP in 2005. However, in relative terms, the poorest 25 per cent of households spent between 20 and 55 per cent of their household income on OOP compared to 13 per cent for the top 25 per cent income groups World Bank, 2010b. 9.4 19 41.2 30.3 32.5 64.4 10.1 20.6 44.6 43.9 35.4 67.7 Romania Belarus Armenia Georgia Moldova Tajikistan Poverty level after catastrophic expenditure Poverty level before catastrophic expenditure 24 Universal Health Protection Figure 3.16. Bangladesh: Out-of-pocket expenditure, by income group, 2005 Note: TK = Bangladeshi taka BDT. Source: World Bank, 2010b. When experiencing high OOP, households need to find ways of generating money. In the short run they may use savings, sell assets, borrow from friends and family or take out a loan. In seeking longer-term solutions, household members may opt for getting children into work, which may result in children being withdrawn from school UNDP, 2013a. Figure 3.17 shows the percentage of households in selected African countries selling assets or borrowing money to finance their health expenditures and cope with medical bills. In nearly all countries, fewer households in the richest quintile were affected compared to lower quintiles. This is in line with the previous findings in Bangladesh, indicating that poorer households carry a heavier burden of OOP Leive and Xu, 2008. 10 20 30 40 50 60 10 20 30 40 50 60 o f h o u se h o ld in co m e B T K p e r h o u se h o ld Income groups BTK BTK per household of household income Universal Health Protection 25 Figure 3.17. Coping with health care expenditure through selling assets and borrowing, by household income level, selected African countries Source: Leive and Xu, 2008. Among the most important causes of OOP are limitations of benefit packages and low quality of services covered, resulting in health services and goods that are not financially protected but instead have to be paid for directly to the service provider by the individual. An example of limitations in benefit packages relates to pharmaceutical drugs, i.e. medicines that are only available on written prescription from a doctor, dentist or pharmacist. In low- and middle-income countries, prescription drugs represent one of the most significant components of health-related OOP, accounting for 26 to 63 per cent of the total and often caused by exclusion from benefit packages. This is one of the most important reasons for catastrophic health expenditure see for example Wirtz et al., 2012 on Mexico. Figure 3.18 shows the percentage of health expenditure for pharmaceutical drugs by households in four developing countries. While in Bangladesh it amounts to 70 per cent of household health expenditure, it exceeds 88 per cent of health expenditure for Vietnamese households. Poorer households not only spend proportionally more on medicaments because of their lower incomes, but are frequently also paying the highest OOP for them in absolute terms, due to the fact that the public sector in developing countries is often unable to provide affordable medicaments in a reliable way UNDP, 2005. 10 20 30 40 50 60 70 80 Burkina Faso Congo Ethiopia Kenya Mali Namibia Zambia Percent of households selling assets or borrowing to finance health payments by income quintile Lowest Quintile 2 Quintile 3 Quintile 4 Highest