Equity in Health Care Expenditure in Nigeria

Olanrewaju Olaniyan, Chukwuedo Susan Oburota and Frances Ngozi Obafemi
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Olanrewaju Olaniyan: Department of Economics, University of Ibadan, Nigeria
Chukwuedo Susan Oburota: Department of Economics, University of Calabar, Nigeria
Frances Ngozi Obafemi: Department of Economics, University of Calabar, Nigeria

International Journal of Finance & Banking Studies, 2013, vol. 2, issue 3, 76-88

Abstract: Equity is one of the basic principles of health systems and features explicitly in the Nigerian health financing policy. Despite acclaimed commitment to the implementation of this policy through various pro-poor health programmes and interventions, the level of inequity in health status and access to basic health care interventions remain high. This paper examines the equity of health care expenditure by individuals in Nigeria. The paper evaluated equity in out-of-pocket spending (OOP) for the country and separately for the six geopolitical zones of the country. The methodological framework rests on Kakwani Progressivity Indices (KPIs), Reynold-Smolensky indices and concentration indices (CIs) using data from the 2004 Nigerian National Living Standard Survey (NLSS) collected by the National Bureau of Statistic. The results reveal that health financing is regressive with the incidence disproportionately resting on poor households with about 70% of the total expenditure on health being financed through out-of-pocket payments by households. Poor households are prone to bear most of the expenses in the event of any health shock. The catastrophic consequences thus push some into poverty, and aggravate the poverty of others. The paper therefore suggests that the country’s health financing systems must be such that allows people to access services when they are needed, but must also protect household, from financial catastrophe, by reducing OOP spending through risk pooling and prepayment schemes within the health system.

Keywords: Equity; Health care expenditure; Health Financing; Out-Of-Pocket Health payment (search for similar items in EconPapers)
Date: 2013
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