How to do (or not to do) … a health financing incidence analysis

Abstract

Financing incidence analysis (FIA) assesses how the burden of health financing is distributed in relation to household ability to pay (ATP). In a progressive financing system, poorer households contribute a smaller proportion of their ATP to finance health services compared to richer households. A system is regressive when the poor contribute proportionately more. Equitable health financing is often associated with progressivity. To conduct a comprehensive FIA, detailed household survey data containing reliable information on both a cardinal measure of household ATP and variables for extracting contributions to health services via taxes, health insurance and out-of-pocket (OOP) payments are required. Further, data on health financing mix are needed to assess overall FIA. Two major approaches to conducting FIA described in this article include the structural progressivity approach that assesses how the share of ATP (e.g. income) spent on health services varies by quantiles, and the effective progressivity approach that uses indices of progressivity such as the Kakwani index. This article provides some detailed practical steps for analysts to conduct FIA. This includes the data requirements, data sources, how to extract or estimate health payments from survey data and the methods for assessing FIA. It also discusses data deficiencies that are common in many low- and middle-income countries (LMICs). The results of FIA are useful in designing policies to achieve an equitable health system.

Business Model Transformation – Challenges for the Management of the Health Care Entity

“…The significance of the determinants depends on the characteristics of the operation of each specific health care market. Clearly, at the very top of external determinants, there is a state healthcare policy that creates a specific framework for the functioning of healthcare entities (Horgan et al, 2018;Sakellariou and Rotarou, 2017), as well as a closely related policy of financing healthcare services from public funds (Ataguba et al, 2018;McCoy et al, 2017;Yates, 2015). The place of service provision is equally important, which determines the availability of resources and their costs, as well as in some cases the demand for healthcare services (Guagliardo et al, 2004;Marino and Quattrone, 2018).…”

Urban–rural disparities in healthcare financing: An analysis under China’s unified residents’ health insurance scheme

“…Proportional financing, whereby KI is theoretically zero, corresponds to a situation where the concentration curve of healthcare payments and the Lorenz curve are located together. In some cases, KI may be zero when the two curves cross each other [25].…”

Equity in Financing and Distribution of Health Benefits in Zambia

“…Assessing progressivity in health financing by using ratios as highlighted in 5.1.1 has some limitations (Ataguba et al 2018). In particular, structural progressivity does not provide a comprehensive picture of how health care payments as a share of ATP are distributed across the entire spectra over time.…”

“…In addition, dominance tests were also calculated (Table 3) in order to establish whether progressivity or regressivity is the same for the entire distribution of ATP. This approach is consistent with guidelines on conducting FIA studies (Ataguba et al 2018), and the multiple comparison approach was used to conduct the dominance tests (O'Donnell et al 2008). Results from the effective progressivity analysis for the year 2010 ( Figure 3A and Table 3) show that taxes as a whole are progressive (Kakwani index = 0.18, p˂0.01).…”