Household Health System Contributions and Capacity to Pay: Definitional, Empirical, and Technical Challenges

In addition to improving population health, an important goal of health systems is to ensure that the financial burden of paying for health is distributed fairly across households (1). Exploring fairness in financial contribution requires the ability to measure each household’s financial contribution (HFC), defined as the ratio of a household’s health system contributions to its capacity to pay. This chapter, organized into five sections, introduces a method for estimating the HFC from household survey data. Section two presents the framework for analysis and the definition of the numerator and denominator of HFC. The third and fourth sections describe in detail the calculation of households’ health system payments through different payment mechanisms and the measurement of capacity to pay. In this context, the data required for estimation are also presented. The last section describes some remaining challenges concerning the measurement of capacity to pay, which are related to the quality of survey data.