The impact of government subsidy programs on equity in health financing

Iran government implemented the targeted subsidy plan in December 2010 to reduce energy consumption and inequality. In addition, the Health Transformation Plan was implemented by the Ministry of Health to reduce out-of-pocket payments. This study aimed to examine the impact of these two government subsidy programs on equity in health financing.

In this study, data on 528,046 households were collected using household surveys during 14 years (2007-2020). The Fairness in Financial Contribution index and Catastrophic Health Expenditures index were calculated. Also, a Logistic regression model was performed by the applied software of Stata V.14 to examine the effects of the two mentioned policies and other socioeconomic characteristics of households on their exposure to Catastrophic Health Expenditures.

The FFC index was 0.829 and 0.795 respectively in 2007 and 2020. The trend analysis did not show significant changes in the FFC index between 2007 and 2020. TSP and HTP implementations do not reduce households' exposure to CHE significantly. Crowded households with more elder people, belonging to low-income deciles, without houses, and living in rural areas and deprived provinces, are more likely to be at risk of CHE. Health insurance coverage did not protect households from CHE. Highly educated and employed households were exposed to less CHE.

The government subsidy programs have not been effective in improving FFC and reducing CHE indices. None of them has been able to realize the goal of the 6th National Development Plan of reducing CHE to 1%. The government should devise support packages for target households (households with more elderly people, lower incomes, without private houses, crowded, rural, and inhabited in deprived provinces), so they can protect households against CHE. Modifying and improving the quality of insurance coverage is strongly recommended due to its inefficiency.