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Are health care payments in Albania catastrophic? Evidence form ALSMS 2002, 2005 and 2008

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  • Tomini, Sonila

    ()
    (Maastricht Graduate School of Governance, Maastricht University)

  • Packard, Truman G.

    ()
    (Europe and Central Asia Human Development Sector, The World Bank)

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    Abstract

    The absent or poorly functioning risk pooling mechanisms and high amounts of out-of-pocket payments for health care expose households to financial risks associated with major illnesses or accidents. The aim of this paper is to analyse the extent to which out-of-pocket health spending impoverish the households in Albania. The study augments the existing evidence by analysing the dynamics of such payments over different years and the weight that informal payments have in the total out-of-pocket health spending. The data used in this study come from Albania Living Standard Measurement Survey (ALSMS) for 2002, 2005 and 2008. We measure headcount catastrophic payments using different thresholds and the decomposition of indicators by expenditure quintiles to understand better their effects. We find that out-of-pocket and informal payments have increased in real value throughout the years. Even though their catastrophic effect has gone down (due also to declining trends in absolute poverty), the effect for the poorest expenditure quintiles remains high. Out-of-pocket payments deepen the poverty headcount and also enlarge the poverty gap and again the effect is larger for the poorest quintiles. Future policy interventions should provide better protection mechanisms for the poor by providing exemption criteria or subsidised transport and should seek to address the widespread informal payments in the country.

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    File URL: http://www.merit.unu.edu/publications/wppdf/2011/wp2011-019.pdf
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    Bibliographic Info

    Paper provided by United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT) in its series MERIT Working Papers with number 019.

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    Date of creation: 2011
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    Handle: RePEc:unm:unumer:2011019

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    Keywords: informal payments; out-of-pocket payments; health care expenditure; impoverishment; Albania LSMS; Albania; living standard; poverty;

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    References

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    1. Paul Gertler & Jonathan Gruber, 2002. "Insuring Consumption Against Illness," American Economic Review, American Economic Association, American Economic Association, vol. 92(1), pages 51-70, March.
    2. Wagstaff, Adam, 2007. "The economic consequences of health shocks: Evidence from Vietnam," Journal of Health Economics, Elsevier, Elsevier, vol. 26(1), pages 82-100, January.
    3. Owen O'Donnell & Eddy van Doorslaer & Adam Wagstaff & Magnus Lindelow, 2008. "Analyzing Health Equity Using Household Survey Data : A Guide to Techniques and Their Implementation," World Bank Publications, The World Bank, number 6896, August.
    4. Waters, Hugh R. & Anderson, Gerard F. & Mays, Jim, 2004. "Measuring financial protection in health in the United States," Health Policy, Elsevier, Elsevier, vol. 69(3), pages 339-349, September.
    5. Adam Wagstaff & Eddy van Doorslaer, 2003. "Catastrophe and impoverishment in paying for health care: with applications to Vietnam 1993-1998," Health Economics, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 12(11), pages 921-933.
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