Progressivity and determinants of Out-of-Pocket Payments in Zambia Felix Mwenge & John Ataguba

1. Progressivity and determinants of Out-of-Pocket Payments in Zambia Felix Mwenge & John Ataguba Health Economics Unit, University of Cape Town

2. Introduction • Universal Health Coverage (UHC) has become a global policy objective • Achieving UHC depends to a large extent on how health care is financed • Most countries that have achieved UHC rely less on regressive financing mechanism (e.g. South Korea, Chile, Costa Rica) • OOP is one of such financing mechanisms found to be regressive in most countries • Most African countries still rely on OOP as a significant source of health financing • This has important implications on the achievement of UHC

3. Objectives To assess the progressivity and determinants of out-of-pocket health care payments in Zambia

4. METHODOLOGY

5. Data Sources & Characteristics

6. Measure of Socio-economic Status • Equivalent household expenditure • Composition of OOP payments • Costs of medicines, fees to medical personnel (e.g. Doctor / Health Assistant / Midwife / Nurse / Dentist, etc), payments to hospital/health centre/surgery , fees to traditional healer • Excluded health related expenses such as transport costs and patient care costs

7. Progressivity of OOP payments Kπ = C– G Kπ =Kakwani index of progressivity C = Concentration index of OOP payments G= Gini index of equivalent expenditure If Kπ = 0, OOP payments are proportional If Kπ < 0, OOP payments are regressive If Kπ > 0, OOP payments are progressive

8. Determinants of OOP payments (Logistic Regression) Dep variable = OOP payments (binary) Independent variables (hhsize, location, age_hh, sex_hh, ms_hh, ed_hh, SES) Determinants of size of OOP payments (Tobit Regression) Dep variable = OOP payments (continuous) Independent variables: (hhsize, location, age_hh, sex_hh, ms_hh, ed_hh, w_hh,SES)

9. FINDINGS

10. % of Households Reporting Illness/Injury

11. % of Households Reporting Paying OOP(OOP>0)

12. Mean Paid OOP per household in Kwacha (US$)

13. Progressivity of OOP, 1998

14. Progressivity of OOP, 2004

15. Progressivity of OOP, 2006

16. Kakwani index of progressivity of OOP payments, 1998, 2004 and 2006

17. Determinants of OOP Payments

18. Determinants of size of OOP Payments

19. CONCLUSION

20. Equity in health care payments requires that payments be progressive • contributions should be made according to ability to pay • Progressivity of OOP payments in 1998 could be due to concentration of payments among richer households compared to poor households • This phenomenon is also common in countries where poor households cannot afford to pay OOP • The results should be taken cautiously • OOP payments where proportional in 2004 and 2006 • As a percentage of their total resources there was no difference in OOP contributions between rich and poor households

21. Living in rural area was significantly associated with less likelihood of incurring OOP in 2006. • This could be due to abolition of user fees in all primary rural facilities in early 2006 • Likelihood of spending OOP was high among richer compared to poorer households and larger households compared to smaller ones

22. Policy Recommendations • OOP should be reconsidered as a means of paying for health care in Zambia if UHC is to be achieved • More progressive payment mechanisms should be considered to achieve UHC • Abolition of user fees should be extended to urban areas to achieve UHC

23. Thank you for your attention Acknowledge financial support from: NRF (South Africa)