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

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

4. METHODOLOGY

5. Data Sources & Characteristics Survey NameYearNo. Of Households LCMS I 199816,000 LCMS III200418,000 LCMS IV 200619,000

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 K π = C– G K π = Kakwani index of progressivity C = Concentration index of OOP payments G= Gini index of equivalent expenditure If K π = 0, OOP payments are proportional If K π < 0, OOP payments are regressive If K π > 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 Socio-economic Status199820042006 Quintile 119 22 Quintile 2221920 Quintile 3202120 Quintile 4202120 Quintile 520 18 Total100

11. % of Households Reporting Paying OOP(OOP>0) Socio-economic Status199820042006 Quintile 1111513 Quintile 218 20 Quintile 321 20 Quintile 4252223 Quintile 5252324 Total100

12. Mean Paid OOP per household in Kwacha (US$) Socio- economic Status 199820042006 Quintile 1445 (US$0.2)3860 (US$0.8)1076 (US$0.3) Quintile 21165 (US$0.5)3959 (US$0.8)2989 (US$0.8) Quintile 32475 (US$ 1.0)4859 (US$1.0)4568 (US$1.3) Quintile 44671 (US$2.0)9402 (US$2.0)7693 (US$2.1) Quintile 512355( US$5.2)27287 (US$5.7)26798( US$7.4) Total4219 (US$1.8)9873 (US$2.1)8623 (US$2.4)

16. Kakwani index of progressivity of OOP payments, 1998, 2004 and 2006 YearKπKπ P-value (5% level of significanceConclusion 19980.340.000Progressive 2004-0.850.2264Proportional 20060.140.819Proportional

17. Determinants of OOP Payments VariablesOdds of spending OOP 199820042006 hhsize1.07 *** 1.08 *** location_hhold0.87*** age_hhead0.94***0.96***0.98 sex_hhead0.80***0.81***0.82*** marital status_hhead1.35*** 1.44*** eduation_hhead0.98***0.90***0.95*** expenditure quintiles1.32***1.20***1.32*** n14 03316 76316 331 Prob>F0.0000

18. Determinants of size of OOP Payments VariablesSize of OOP Year199820042006 hhsize1543***4602***6133 *** sex_hh-3298**-15715***-16950** ms_hh4811***20134***32851*** education_hh-2274*** working_hh-11038** Exp quintiles7642***14129***29228*** constant-58162***-151248***-251830*** n14 03216 76316 361 Prob>F0.0000

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 o 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.  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)