Examining the density in out-of-pocket spending share in the estimation of catastrophic health expenditures

Universal health coverage (UHC) aims to provide access to health services for all without financial hardship. Moving toward UHC while ensuring financial risk protection (FRP) from out-of-pocket (OOP) health expenditures is a critical objective of the Sustainable Development Goal for Health. In tracking country progress toward UHC, analysts and policymakers usually report on two summary indicators of lack of FRP: the prevalence of catastrophic health expenditures (CHE) and the prevalence of impoverishing health expenditures. In this paper, we build on the CHE indicator: we examine the distribution (density) of health OOP budget share as a way to capture both the magnitude and dispersion in the ratio of households’ OOP health expenditures relative to consumption or income at the population level. We illustrate our approach with country-specific examples using data from the World Health Organization’s World Health Surveys.