Financial Catastrophism Inherent with Out-of-Pocket Payments in Long Term Care for Households: A Latent Impoverishment

Raúl Del Pozo-Rubio, Isabel Pardo-García and Francisco Escribano-Sotos
Additional contact information
Raúl Del Pozo-Rubio: School of Social Sciences, Sociosanitary Research Center, Castilla-La Mancha University (UCLM), 16071 Cuenca, Spain
Isabel Pardo-García: School of Economics and Business Administration, Sociosanitary Research Center, Castilla-La Mancha University (UCLM), 02071 Albacete, Spain
Francisco Escribano-Sotos: School of Economics and Business Administration, Sociosanitary Research Center, Castilla-La Mancha University (UCLM), 02071 Albacete, Spain
Authors registered in the RePEc Author Service: Francisco Escribano Sotos ()

IJERPH, 2020, vol. 17, issue 1, 1-19

Abstract: Background: Out-of-pocket (OOP) payments are configured as an important source of financing long-term care (LTC). However, very few studies have analyzed the risk of impoverishment and catastrophic effects of OOP in LTC. To estimate the contribution of users to the financing of LTC and to analyze the economic consequences for households in terms of impoverishment and catastrophism after financial crisis in Spain. Methods: The database that was used is the 2008 Spanish Disability and Dependency Survey, projected to 2012. We analyze the OOP payments effect associated to the impoverishment of households comparing volume and financial situation before and after OOP payment. At the same time, the extent to which OOP payment had led to catastrophism was analyzed using different thresholds. Results: The results show that contribution of dependent people to the financing of the services they receive exceeds by 50% the costs of these services. This expenditure entails an increase in the number of households that live below the poverty. In terms of catastrophism, more than 80% of households dedicate more than 10% of their income to dependency OOP payments. In annual terms, the catastrophe gap generated by devoting more than 10% of the household income to dependent care OOP payment reached €3955, 1 million (0.38% of GDP). Conclusion: This article informs about consequences of OOP in LCT and supplements previous research that focus on health. Our results should serve to develop strategic for protection against the financial risk resulting from facing the costs of a situation of dependence.

Keywords: out-of-pocket payments; catastrophic long-term care payments; impoverishing; poverty impact (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.mdpi.com/1660-4601/17/1/295/pdf (application/pdf)
https://www.mdpi.com/1660-4601/17/1/295/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jijerp:v:17:y:2020:i:1:p:295-:d:303983

Access Statistics for this article

IJERPH is currently edited by Ms. Jenna Liu

More articles in IJERPH from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().