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SummaryCompared to its neighbors, Sri Lanka performs well in terms of health. Health care is provided for free in the public sector, yet households' out‐of‐pocket health expenditures are steadily increasing. We explore whether this increase can be explained by supply shortages and insufficient public health care financing or whether it is rather the result of an income‐induced demand for supplementary and higher quality services from the private sector. We focus on total health care expenditures and health care expenditures for specific services such as expenses on private outpatient treatments and expenses on laboratory and other diagnostic services. Overall, we find little indication that limited supply of public health care per se pushes patients into the private sector. Yet income is identified as one key driver of rising health care expenditures, ie, as households get richer, they spend an increasing amount on private services suggesting a dissatisfaction with the quality offered by the public sector. Hence, quality improvements in the public sector seem to be necessary to ensure sustainability of the public health care sector. If the rich and the middle class increasingly opt out of public health care, the willingness to pay taxes to finance the free health care policy will certainly shrink.

Purpose Food consumption patterns have changed in many Asian countries over the past two–three decades. It is important to understand the changes in food consumption patterns and its drivers in different country settings as each country has different food cultures, tastes and habits. Thus, the purpose of this paper is to examine the patterns and determinants of food consumption choice and demand in Sri Lanka. Design/methodology/approach Using Household Income and Expenditure Survey 1990/1991, 2002 and 2012/2013 data, this study explores the relationship between food consumption patterns and the observed changes reported in per capita income, urbanization, structural transformations and demographics. Specifically, present study estimates the probability of consuming main food items such as rice, bread, dhal, vegetables and fish using a multivariate probit model and also estimates income and price elasticities of household major food items by applying Quadratic Almost Ideal Demand System. Findings This study demonstrates that per capita income, food prices, education level of the household heads, rural–urban affiliation and ethnic background significantly affect the consumption decision of the major food items. Sri Lankan households in general seem to consider that rice and dhal are necessary commodities, whereas bread and fish are luxury commodities. Research limitations/implications The lack of panel data and several missing districts in two survey rounds for analysis are limitations of the study. Originality/value To the author’s knowledge, this is the first study for Sri Lanka that examines food consumption choice and demand using nationwide data for the last two decades. This study applies novel econometric techniques to account for various issues in data analysis.

This article examines the effects of chronic non-communicable diseases (NCDs) on households' out-of-pocket health expenditures in Sri Lanka. We explore the disease specific impacts on out-of-pocket health care expenses from chronic NCDs such as heart diseases, hypertension, cancer, diabetics and asthma. We use nationwide cross-sectional household income and expenditure survey 2012/2013 data compiled by the department of census and statistics of Sri Lanka. Employing propensity score matching method to account for selectivity bias, we find that chronic NCD affected households appear to spend significantly higher out-of-pocket health care expenditures and encounter grater economic burden than matched control group despite having universal public health care policy in Sri Lanka. The results also suggest that out-of-pocket expenses on medicines and other pharmaceutical products as well as expenses on medical laboratory tests and other ancillary services are particularly higher for households with chronic NCD patients. The findings underline the importance of protecting households against the financial burden due to NCDs.

This paper examines healthcare utilization behaviour in Sri Lanka with special emphasis on the choice between costly private and free public healthcare services. We use a data set that combines nationwide household survey data and district level healthcare supply data. Our findings suggest that even with universal public healthcare policy, richer people tend to use private sector healthcare services rather than public services. We also find significant regional and ethnic discrepancies in healthcare access bearing the risk of social tensions if these are further amplified. Latent class analysis shows in addition that the choice between private and public sector healthcare significantly differs between people with and without chronic diseases. We find in particular that chronically ill people rely for their day-to-day care on the public sector, but for their inpatient care they turn more often than non-chronically ill people to the private sector, implying an additional financial burden for the chronically ill. If the observed trend continues it may not only increase further the health-income gradient in Sri Lanka but also undermine the willingness of the middle class to pay taxes to finance public healthcare.

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