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Economies 2015, 3(4), 216-234; doi:10.3390/economies3040216

Catastrophic Economic Consequences of Healthcare Payments: Effects on Poverty Estimates in Egypt, Jordan, and Palestine

1
Philipps-Universität Marburg, Marburg 35037, Germany
2
Department of Economics, Faculty of Commerce, Damanhour University, Damanhour 22514, Egypt
3
Department of Economics, Faculty of Arts, University of Alberta, Edmonton, AB T6G 2H4, Canada
*
Author to whom correspondence should be addressed.
Academic Editor: Nishith Prakash
Received: 26 August 2015 / Revised: 15 November 2015 / Accepted: 25 November 2015 / Published: 26 November 2015
(This article belongs to the Special Issue The Role of Education and Health in Economic Development)
View Full-Text   |   Download PDF [441 KB, uploaded 30 November 2015]   |  

Abstract

Healthcare payments could drive households with no health insurance coverage into financial catastrophe, which might lead them to cut spending on necessities, sell assets, or use credit. In extreme cases, healthcare payments could have devastating consequences on the household economic status that would push them into extreme poverty. Using nationally representative surveys from three Arab countries, namely, Egypt, Jordan, and Palestine, this paper examines the incidence, intensity and distribution of catastrophic health payments, and assesses the poverty impact of out-of-pocket health payments (OOP). The OOP for healthcare were considered catastrophic if it exceeded 10% of a household’s total expenditure or 40% of non-food expenditure. The poverty impact was evaluated using poverty head counts and poverty gaps before and after OOP. Results show that OOP exacerbate households’ living severely in Egypt, pushing more than one-fifth of the population into a financial catastrophe and 3% into extreme poverty in 2011. However, in Jordan and Palestine, the disruptive impact of OOP remains modest over time. In the three countries, the catastrophic health payment is the problem of the better off households. Poverty alleviation policies should help reduce the reliance on OOP to finance healthcare. Moving toward universal health coverage could also be a promising option to protect households from the catastrophic economic consequences of health care payments. View Full-Text
Keywords: catastrophic health payments; poverty; Egypt; Jordan; Palestine catastrophic health payments; poverty; Egypt; Jordan; Palestine
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).

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MDPI and ACS Style

Rashad, A.S.; Sharaf, M.F. Catastrophic Economic Consequences of Healthcare Payments: Effects on Poverty Estimates in Egypt, Jordan, and Palestine. Economies 2015, 3, 216-234.

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