Bring down out-of-pocket healthcare expenditure

Bangladesh’s out-of-pocket healthcare spending is unacceptably high. The breakdown of healthcare spending in the country is quite disturbing. Only 23 per cent is spent by the public sector on each citizen annually, whereas the citizens themselves spend 68 per cent, says a report published in The Business Post on Tuesday. The rest comes from other sources, with development partners paying five per cent. Bangladesh is supposed to be a welfare state, and this lopsided ratio is undesirable. Yet the irony is that the budget share for the health sector of Bangladesh has been well under three per cent of the Gross Domestic Product (GDP) for over a decade.

Against this backdrop, experts recently said in a pre-budget national dialogue that Bangladesh’s health sector allocations in the upcoming budget must reduce the people’s out-of-pocket expenditure for availing healthcare. The national dialogue was organised jointly by the Bangladesh Health Watch, Brac James P Grant School of Public Health, Brac University, and Unnayan Shamannay in the Azimur Rahman Conference Hall on Monday. Former governor of the central bank and President of Unnayan Shamannay Dr. Atiur Rahman presented a keynote based on data from the government’s Finance Division and findings from a recent field survey.

The former Bangladesh bank governor pointed out that by tripling the allocations for the medical and surgical supply sub-sector of the health budget and by filling up all the vacancies at the Upazila health complexes, union health sub-centers, and community clinics, the share of the out-of-pocket costs can be brought down to 51 per cent. However, the former governor said that to ensure access to quality healthcare, the policymakers must go beyond just increasing allocations and aim to revamp the entire health sector.

Out-of-pocket healthcare expenditures continue to be the most effective means of healthcare in this country and constitute a large share of the people’s financial plans. Healthcare expenditures are largely unpredictable and usually hurt the poorer households, while large expenditures have catastrophic impacts on household welfare. A sudden serious illness exposes the critical susceptibility of the poor to unexpected and unforeseen healthcare-related vulnerabilities, increased indebtedness due to income loss, and even unemployment. Disease and related caring expenditures and consequent impacts can severely disrupt living standards.

Bangladesh, unfortunately, has been a low spender on the health of its citizens. In 2019, health expenditure per capita for Bangladesh was 46 US dollars. In India, the figure is 64 USD. Even a relatively weak economy like Myanmar spends 60USD on per capita health care. In the dialogue, MP Rumin Farhana said, “Neighbouring Bhutan has universal healthcare, and India is experimenting with different health insurance schemes for the lower-income groups. Bangladesh can learn from these experiences and plan a way to initiate universal healthcare.”

The minimum amount that governments should spend to provide essential healthcare is debatable. One credible and frequently quoted estimate comes from the High-Level Taskforce on Innovative International Financing for Health Systems, which stipulates an average figure of $86 per person (in 2012). A more recent estimate from 2017, including investments in the health system, sets the bar at $271 per person. However, we should note that $86 was recommended as minimum public-sector spending, whereas the above-mentioned $46 per capita in Bangladesh is the total health expenditure.

Necessary attention has rarely been given in Bangladesh to recognize the linkage between health, healthcare provision, and poverty, which could be the basis for the public investment policies on the state of health and living standards. The poor are worse protected from healthcare burdens in Bangladesh. Therefore, the national policies should emphasize the poverty reduction strategies through improved healthcare status of the individuals. It is also essential to invest more in the health sector as a continuing process, especially in the rural areas, and then the outcomes contribute to sustainable development.