Catastrophic Health Spending in Uganda

Catastrophic health spending (CHS) is a primary cause of poverty in many underdeveloped countries. The lack of social safety nets and prepayment mechanisms force most households to pay off medical expenses with out-of-pocket expenditure. This study looked into the key determinants of CHS among households in Uganda and provides policy implications for reducing the risk of CHS. We used data from 2013-2014 Uganda National Panel Survey, which provides both household and individual-level questions on consumption expenditure, health expenditure, and other variables like living conditions and distance to closest medical facility. To determine the primary variables driving the intensity of CHS, we used a two-part model that first runs a logistic regression on the likelihood of a household hitting CHS then ran a regression on the intensity of the CHS for those that hit CHS and finally combines the results of the two given the probability of both. The two-part model was applied with a catastrophic threshold set at 10% for total expenditure and 40% for discretionary expenditure, which is total expenditure subtracted by food expenditure. These were the consistent thresholds chosen in literature. The results of the two-part model indicate that distance to closest medical facility and incidence of sicknesses in the last 30 days or more increase the probability of CHS. The more crowded a household was and the higher percentage of female members increased CHS. Our study should open policy discussions for future projects on how to make healthcare more accessible as well as other public health dialogue. While it is important to introduce more prepayment mechanisms, a more feasible alternative is raising more public health awareness