Elsevier

The Lancet

Volume 380, Issue 9837, 14–20 July 2012, Pages 126-133
The Lancet

Articles
Equity in financing and use of health care in Ghana, South Africa, and Tanzania: implications for paths to universal coverage

https://doi.org/10.1016/S0140-6736(12)60357-2Get rights and content

Summary

Background

Universal coverage of health care is now receiving substantial worldwide and national attention, but debate continues on the best mix of financing mechanisms, especially to protect people outside the formal employment sector. Crucial issues are the equity implications of different financing mechanisms, and patterns of service use. We report a whole-system analysis—integrating both public and private sectors—of the equity of health-system financing and service use in Ghana, South Africa, and Tanzania.

Methods

We used primary and secondary data to calculate the progressivity of each health-care financing mechanism, catastrophic spending on health care, and the distribution of health-care benefits. We collected qualitative data to inform interpretation.

Findings

Overall health-care financing was progressive in all three countries, as were direct taxes. Indirect taxes were regressive in South Africa but progressive in Ghana and Tanzania. Out-of-pocket payments were regressive in all three countries. Health-insurance contributions by those outside the formal sector were regressive in both Ghana and Tanzania. The overall distribution of service benefits in all three countries favoured richer people, although the burden of illness was greater for lower-income groups. Access to needed, appropriate services was the biggest challenge to universal coverage in all three countries.

Interpretation

Analyses of the equity of financing and service use provide guidance on which financing mechanisms to expand, and especially raise questions over the appropriate financing mechanism for the health care of people outside the formal sector. Physical and financial barriers to service access must be addressed if universal coverage is to become a reality.

Funding

European Union and International Development Research Centre.

Introduction

There is a growing focus on the goal of universal coverage in health systems. For example, the World Health Report 2010 on universal coverage of health care1 and the associated declaration of the World Health Assembly2 urged member states to “aim for affordable universal coverage and access for all citizens on the basis of equity and solidarity”.2 Several countries, such as India3 and South Africa,4 have lately developed policy proposals to pursue this goal. The generally accepted core of universal coverage is that the health system should be financed in accordance with the ability to pay, and benefits received in accordance with the need for health care (panel 1). Analytical methods are available to assess health systems relative to these principles, notably in the form of financing incidence analysis (assessing whether health-care financing methods are progressive, regressive, or proportional), and benefit incidence analysis (assessing the monetary value of service benefits received by different socioeconomic groups). However, debate on the relative merits of different approaches to financing of health care has tended to proceed without good evidence on the equity of present arrangements, and has made generalisations that lack a sufficiently strong evidence base—eg, certain forms of tax financing are regressive in low-income countries and public services are exploited more by richer groups. As countries plan their paths to universal coverage, and debate grows on the relative merits of financing mechanisms including various types of tax financing, social health insurance, community-based insurance, and out-of-pocket payments, it is crucial that better evidence be made available on equity implications. We report the results of a three-country study on the equity of health-system financing and service use.

Section snippets

Countries assessed

We selected Ghana, South Africa, and Tanzania because they are all considering how best to develop their health systems towards universal coverage, and they represent systems at different stages of development (panel 2). Ghana began implementing a national health insurance scheme in 2004, with elements covering both the formal and informal sectors. South Africa has just released a Green Paper on introducing a national health-insurance scheme.4 Tanzania in recent decades has introduced various

Results

Direct taxes were progressive in all three countries. Indirect taxes were regressive in South Africa but progressive in Ghana and Tanzania (figure 1). Out-of-pocket payments were regressive and overall health-care financing was progressive in all three countries.

Figure 2 shows the differences between the countries in the relative progressivity of indirect taxes. All forms of indirect tax (value-added tax [VAT], fuel levies, and excise duties) were regressive in South Africa. By contrast, VAT

Discussion

Despite very different arrangements for health-care financing in the three countries (panel 2), we consistently identified that financing was progressive in all three, although there were wide variations in the relative progressivity of different funding sources across countries. Although the finding that total health-care financing was progressive is perhaps not unexpected, since richer groups might be more able to contribute to the cost of their health care, we note that all public sources of

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