Catastrophic effect ofout-of-pocket health care expenditure on household poverty in Tanzania: lessons from Tanzania panel survey

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The University of Dodoma
The study aimed to analyze the occurrence and severity of catastrophic health spending in Tanzania and its impact on household well-being. The logit model was used to investigate the factors that contribute to catastrophic out-of-pocket (OOP) health expenditure, while also addressing concerns related to estimate issues like endogeneity, heteroscedasticity, and multicollinearity. The findings of the study indicate that the incidence of catastrophic health expenditure, defined as spending more than 10% of total consumption expenditure on healthcare services, varied over time. The calculated headcount of catastrophic expenditure was 13.9% in 2008/2009, 14.5% in 2010/2011, and 14.1% in 2012/2013. This means that, on average, around 13.9% to 14.5% of interviewed households who sought healthcare and paid for it out of pocket spent more than 10% of their consumption expenditure on healthcare services during the specified periods. Similarly, the frequency and magnitude of catastrophic health payments at the 40% level exhibited some similarities. Regarding the consequences of catastrophic OOP expenses, the study found that the percentage of households that fell into poverty due to these expenses decreased from 3.6% in 2008/2009 to 2.5% in 2010/2011, but then slightly increased to 3.3% in 2012/2013. Overall, an average of 3.1% of the population was impoverished or made poor due to catastrophic health payments. The study also identified several factors associated with catastrophic OOP expenditure, namely household size, age of the household head (65+), and "exp" (which likely refers to an unmentioned variable). These variables were found to be determinants of households experiencing catastrophic health expenses. The study's results align with existing literature, indicating that out-of-pocket health expenses can lead to financial catastrophe for poor households, exacerbating their hardships and potentially forcing them to resort to risky coping mechanisms. Consequently, the study advocates for the implementation of new and strengthened strategies to protect poor households from such catastrophic health costs. In conclusion, this research sheds light on the prevalence and implications of catastrophic health spending in Tanzania, emphasizing the need for policies and interventions to safeguard vulnerable households from the economic burden of out-of-pocket healthcare expenses.
Dissertation (MA Economics)
catastrophic health spending, household well-being, health expenditure, catastrophic out-of-pocket, Tanzania
Mwemutsi, Festo A.(2023) Catastrophic effect ofout-of-pocket health care expenditure on household poverty in Tanzania: lessons from Tanzania panel survey. (Masters Dissertation) The University of Dodoma