The Effect of Mid-to-Long-Term Hospitalization on the Catastrophic Health Expenditure: Focusing on the Mediating Effect of Earned Income Loss

Abstract

Background: Mid-to-long-term hospitalization (MLTH) can threaten the household economy with high medical costs and loss of income. Therefore, it could increase the catastrophic health expenditure (CHE), measured as the ratio of medical expenses to the ability to pay. This study aimed to determine the effect of MLTH on the incidence of CHE and the mediating effect of earned income reduction rate (EIRR). Methods: We used 2015 to 2017 data from the Korean Welfare Panel Study and selected households with earned income through work. The final samples were 1671 households in the database. This study applied three-step regression analyses for estimating mediation effects. Results: First, MLTH affected CHE increases; second, MLTH increased EIRR; third, both EIRR and MLTH increased CHE at the same time. Additionally, the bootstrapping results were 0.364 to 0.644 in the 95% confidence interval, which suggested that EIRR mediated the effects of MLTH on CHE. Conclusions: Previous studies have only focused on medical costs when interpreting CHE; however, it is also essential to recognize that the MLTH can have a negative effect on the EIRR. This study contributed to the literature by giving another insight into interpreting the cause of CHE, focusing on income loss factors.

Understanding variation in catastrophic health expenditure from socio-ecological aspect: a systematic review

“…Families rarely go for distress financing (donation, sale of assets, loan). Instead, (20,29,31,41,46,47) Type of family (2,39) Out-of-pocket payment for health (17,44,45,59) Poverty (6,9,12,23,26,35,37,42,44,52) Unregulated market (8,46) Gender (4,20,38,39,41,48) Household size (15,31,43,47,50) Physician's fee (45) Comorbidity (15,51) Ethnicity ( 29) Gender of household head (4,10,14,31) Outpatient visit (61) Social stigma (14,59) Education (9,20,31,42,47) Age of household head…”

“…OOP is the crucial determinant of CHE, and utilized care is the key contributor. Only three studies from Bangladesh and South Korea concentrated on inpatient care, and a study from Pakistan worked on medication [15,26,38,59]. One paper from Bangladesh on spinal cord injury worked on community-based home care [57].…”

“…Nevertheless, the elderly who do not have any earning source at this age, and this dependency pushes them into CHE [36]. Again, several studies from Bangladesh and South Korea found that the loss of income due to disease, an indirect cost of illness, increases CHE incidence [13,15,37,38]. With the increase in sick days, this indirect loss increases, which worsens the financial catastrophe [30].…”

“…Type of illness is a significant predictor of CHE [7,22,39]. Studies from Bangladesh, South Korea, India, and China found that diseases that require inpatient care have higher CHE incidence as with the increase in hospitalization, the direct cost and indirect income loss due to disease increases the financial burden [13,15,18,26,30,37,38,40]. Studies from Bangladesh, China, Vietnam, and Malaysia concluded that NCD, Cancer, and Chronic disease have higher CHE incidence as these diseases demand long-term care and the treatment is expensive [4, 18, 24-26, 32, 41].…”

“…Apart from those direct costs, a study in Bangladesh identified indirect costs like food, lodging, and transport costs as significant predictors of CHE [57]. Healthrelated income loss is another indirect cost that notably impacts impoverishment in South Korea and Bangladesh [13,15,37,38]. The included literature identified predictors related to utilized care.…”