Why the poor pay more: household curative expenditures in rural Sierra Leone

This paper draws on data from Sierra Leone, and secondary data from elsewhere, to show that the rural poor can be disproportionately disadvantaged by user charges for health care, paying a higher percentage of their incomes for health care than wealthier households. Cost sharing systems at primary care level should include exemptions for the poor, but rarely succeed in consistently protecting them. The regressivity of health expenditures also results from lack of protection from the higher costs of less-frequently used, expensive providers. In Sierra Leone, the burden of curative treatment costs for all groups came mainly from private and NGO providers. Proximity to facilities appeared a more important factor in their use than average price levels. Even if a perfect exemption system existed at government primary care facilities, it would not have had much overall effect because of their relatively small contribution to household health expenditures. The financial burden on households could be relieved by making basic health facilities more accessible and at hospital level using additional resources generated through improved efficiency and cross-subsidization to provide exemptions. Also, pricing policy should take into account local economic conditions. Insurance/prepayment schemes covering the cost of hospitalization would come closer to an ideal solution, but have been implemented in very few of the poorer countries.