Health Equity and Financial Protection: Part II
Financial Protection Health care finance in low-income countries is still characterized by the dominance of out-of-pocket payments and the relative lack of prepayment mechanisms, such as tax and health insurance. Households without full health insurance coverage face a risk of incurring large expenditures for medical care should they fall ill; this will affect their ability to purchase other goods and services that policy makers consider to be important, such as food and shelter. Two approaches have been used to get empirically at this idea. The first looks at payments that are catastrophic in the sense that they involve amounts of money that exceed some fraction of household consumption. The second asks whether the amount of money involved makes the difference between a household being above or being below the poverty line in terms of the money it has available for things other than health care.
Catastrophic Health Spending Households are classified as having out-of-pocket health spending that is catastrophic if it exceeds a certain fraction of consumption.1 The percentage of the population being so classified is likely, of course, to depend on the threshold chosen. ADePT reports the percentage of the population experiencing catastrophic health spending for different thresholds; this is termed βthe head count.β ADePT also allows users to plot a chart showing how the head count varies depending on the threshold used, as in figure 8.1. Policy makers might be concerned not just about the percentage of households exceeding the threshold but also about the amount by which they exceed it. This is analogous to the issue of poverty measurement: policy makers are concerned not just about the percentage of the population that falls below the poverty line but also about how far they fall below it. So, in addition to reporting the incidence of catastrophic health payments, ADePT Health Financing also reports the intensity of catastrophic health care payments, through a concept known as βthe overshootβ: the larger the amount by which βovershootingβ households exceed the threshold, the greater is the (average) overshoot. In figure 8.1, the area below both the
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