Disease-specific Impoverishment Impact of Out-of-Pocket Payments for Health Care: Evidence from Rural Bangladesh

This paper examines disease-specific impoverishment impact of out-of-pocket (OOP) payments using a dataset of 3,941 households obtained from a survey conducted in 120 villages of seven districts in Bangladesh. We have estimated the poverty impact of OOP payments by comparing the difference between the average level of headcount poverty and poverty gap with and without health care payments. We find that OOP payments annually push 3.4 percent households into poverty in rural Bangladesh. The corresponding figures for those who had NCDs (non-communicable diseases), chronic illness, hospitalization and catastrophic illness respectively were 4.61, 4.65, 14.53 and 17.33 percent. Note that NCDs are the major part of the latter two situations (about 88% and 85% respectively). Looking into individual categories of NCDs we find that headcount impoverishment impact was immense for cholecystectomy, mental disorder, kidney disease, cancer and appendectomy. The impact on the intensity of impoverishment is the largest among the hospitalized patients and more individually among cancer patients. Hence, NCDs particularly chronic NCDs and those requiring immediate surgical procedures should be given more priority for policy framing. In addition to adopting some ex-ante measures (e.g. raising awareness regarding the risk factors causing NCDs), the paper argues for reforms to enhance efficiency in the public health care facilities and increasing quality of public health care.