Determinants of Out-of-Pocket Health Expenditure in Pakistan: Empirical Insights from Micro-level Data

Abstract

Out-Of-Pocket (OOP) health expenditure is an internationally recognized measure of health expenditure at household level, especially in middle income countries. This study explores various socio-economic and demographic determinants of OOP health expenditure in Pakistan. The descriptive analysis and regression type results using Variance-Weighted Least Squares (VWLS) method were generated to find out the nature of impact and the significance of various determinants of healthexpenditures. As per the findings, the average yearly OOP disbursement on household health was around RS. 13,897 (nearly 3% of household consumption expenditure). The impact of factors like household size, smoke consumption, the number householddependents, average household education, and consumption expenditure was found statistically significant while having positive effect on OOP health expenditure in the estimated model. Households with the facilities of piped water, proper sanitation and garbage disposal system were having less spending on health. The results have shown that in rural Baluchistan, gas connection was having low impact and number of under-five children had highest impact on OOP health expenditure, while in urban Baluchistan piped water had lowest impact on health spending. The signs of the variables used in this study were in line with the dominant view of the literature.