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Determinants of Out-of-Pocket Healthcare Spending in Bangladeshi
Background: Equity has long been considered an important goal in the health sector. Yet inequalities in health outcomes, health care utilization, and health financing persist among groups within the same country. The vast majority of people in low-income countries are not fortunate enough to have proper access to public health services which are likely to be unaffordable to the poor and mostly financed by OOP spending. A south Asian developing country, like Bangladesh, is constitutionally (Part II, Article 15 of the Constitution) obligated to its people to provide “the basic necessities of life, including food, clothing, shelter, education and medical care to its citizens.” However, poverty, ignorance, and other social barriers keep many people from accessing healthcare services essential to maintaining individual health and making healthy choices.
Data and Method: We utilized a reliable nationally representative Household Income and Expenditure Survey, Bangladesh: 2009-2012 project data, from a random sample of 12,240 households consisting 55,580 individuals. A Double Hurdle (Cragg, 1971) model was applied to the survey data to analyze the major determinants of OOP healthcare expenditures.
Results: Contrary to the common perception that the decision of whether to spend on healthcare services and how much to spend depend primarily on an individual’s health and illness, our analysis shows that illness is but one of the many factors involved in demand for healthcare. Other influences, such as household characteristics, education level, type of medical consultant, location, wealth variable significantly influence the level of healthcare expenditure. In addition, spending on pharmaceutical drugs is the major component (57%-72%) of healthcare expenditures and the rural households are more likely to suffer catastrophic expenditures.