Determinants of Out-of-Pocket Health Care Expenditure in Uganda: A Household Level Analysis

Abstract

There is vast academic literature on the determinants of out of pocket health care expenditure focusing on developed and low developed countries, however little is known about these factors in Uganda’s perspective and much worse, how these determinants vary across areas of residence, that is; among individuals living in rural versus those residing in urban areas of Uganda. This study attempts to fill this gap in literature by using a random effects model as an estimation strategy to analyze data from the Uganda National Panel Surveys of 2011/2012; 2013/2014 and 2015/2016. These panels are merged to cover a sample of 2,130 households that incurred out of pocket health care expenditure. The study examines socio-economic determinants of out of pocket health care expenditure in Uganda. Furthermore, it explorers whether and to what extent these determinants vary across areas of residence (that is: among rural versus urban residents). Findings indicate that: age, level of education (that is, those with some secondary, completed secondary and post-secondary or degree as their highest level of education), distance to the nearest health facility, gender (being female), household size and area of residence (that is, urban) had a positive and statistically significant effect on out of pocket health care expenditure in Uganda. On the other hand, marital status (that is, never married); and the region (that is eastern and Northern) had a negative and statistically significant relationship with out of pocket health care expenditure. Differences between rural versus urban residents are noted with regard to the effect of age and the level of education on out of pocket health care expenditure where these factors were found to affect only rural resident but not those in the urban settings. The following policy recommendations can be drawn from the finding. a) the need to develop innovative ways to reduce the financial burden on households, particularly for those in rural areas, to improve equity in access to health care services and improve financial protection; b) households having elderly members and those large in size should be exempted from paying some of the healthcare expenditures; c) policies that ensure that households have access to health care at subsidized cost or at no costs at all, these should particularly cover female headed households.