Trends in household out-of-pocket health expenditures and their underlying determinants: explaining variations within African regional economic communities from countries panel data

Ngepah and Ndzignat Mouteyica Globalization and Health (2024) 20:27 https://doi.org/10.1186/s12992-024-01032-0 Globalization and Health Open Access RESEARCH Trends in household out‑of‑pocket health expenditures and their underlying determinants: explaining variations within African regional economic communities from countries panel data Nicholas Ngepah1 and Ariane Ephemia Ndzignat Mouteyica1*    Abstract Background The persistently high out-of-pocket health spending (OOPHE) in Africa raise significant concern about the prospect of reaching SDG health targets and UHC. The study examines the convergence hypothesis of OOPHE in 40 African countries from 2000 to 2019. Methods We exploit the log t , club clustering, and merging methods on a panel of dataset obtained from the World Development Indicators, the World Governance Indicators, and the World Health Organization. Then, we employ the multilevel linear mixed effect model to examine whether countries’ macro-level characteristics affect the disparities in OOPHE in the African regional economic communities (RECs). Results The results show evidence of full panel divergence, indicating persistent disparities in OOPHE over time. However, we found three convergence clubs and a divergent group for the OOPHE per capita and as a share of the total health expenditure. The results also show that convergence does not only occur among countries affiliated with the same regional economic grouping, suggesting disparities within the regional groupings. The findings reveal that countries’ improved access to sanitation and quality of governance, increased childhood DPT immunization coverage, increased share of the elderly population, life expectancy at birth, external health expenditure per capita, and ICT (information and communication technology) significantly affect within-regional groupings’ disparities in OOPHE per capita. The results also show that an increasing countries’ share of elderly and younger populations, access to basic sanitation, ICT, trade GDP per capita, life expectancy at birth, childhood DPT immunization coverage, and antiretroviral therapy coverage have significant impacts on the share of OOPHE to total health expenditure within the regional groupings. Conclusion Therefore, there is a need to develop policies that vary across the convergence clubs. These countries should increase their health services coverage, adopt planned urbanization, and coordinate trade and ICT access policies. Policymakers should consider hidden costs associated with access to childhood immunization services that may lead to catastrophic health spending. *Correspondence: Ariane Ephemia Ndzignat Mouteyica Full list of author information is available at the end of the article © The Author(s) 2024. Open Access This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article’s Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article’s Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/. The Creative Commons Public Domain Dedication waiver (http://creativecommons.org/publicdomain/zero/1.0/) applies to the data made available in this article, unless otherwise stated in a credit line to the data. Ngepah and Ndzignat Mouteyica Globalization and Health (2024) 20:27 Page 2 of 17 Keywords Out-of-pocket spending, Inequality, RECs, Africa, Convergence, Health Introduction Insufficient investments in the health sector are hindering Africa’s progress toward attaining Sustainable Development Goals (SDGs) and Universal Health Coverage (UHC) and improving the health outcomes of its populations. With a financial gap for healthcare of USD 66 billion per annum, the considerable health financing constraints that the continent faces arise primarily from the existing health financing mechanisms and strategies, including extensive out-of-pocket (OOP) payments [1, 2]. In many countries, OOP spending leading to catastrophic health expenditures is worrisome, representing 40 percent or more of the total health expenditure. This source of financing is the most regressive and inequitable way of funding healthcare. The heavy dependence on this payment mechanism makes the financial costs a significant barrier to accessing healthcare services and increases the risk of impoverishment [3]. The Abuja call and WHO recommendation to reduce out-of-pocket payments to the upper limit of 20 percent of the total health expenditure are seen as a solution to address the health financing and equity issues and ensure financial protection in the continent [3, 4]. Empirical studies showed considerable cross-country variations in out-of-pocket expenditures within and between countries. For instance, a previous study found that out-of-pocket payments do not converge between countries. Burkina Faso, Paraguay, and Thailand exhibited regressive trends, whereas Guatemala and South Africa displayed progressive trends [5]. Additionally, a separate study identified regressive patterns in outof-pocket healthcare spending in high-income Asian countries [6]. Variations in catastrophic health expenditure among 12 Latin American countries and the Caribbean were observed, ranging from 1 to 25 percent [7]. Evidence of disparities in aggregate out-of-pocket expenditure per capita within ten high-income countries was also highlighted in another study [8]. Notably, the study demonstrated a decline in these disparities over time..At the micro-level, variations in OOPHE are mainly caused by variations in socioeconomic status, income, gender, age, geographical location, elderly population, health insurance, and education of the households [9, 10]. For instance, OOPHE was found to be significantly higher for females, individuals with high socioeconomic status, and those with large household sizes; however, the presence of insurance was associated with a reduction in these expenditures [9]. Analyzing 34 studies in Sub-Saharan Africa (SSA), it was revealed that various factors—such as household economic status, type of health provider, socio-demographic characteristics of household members, type of illness, social insurance schemes, geographical location, and household size—are significant risk factors associated with catastrophic health expenditure [10]. .However, at the macro-level, indicators such as gross domestic product (GDP) per capita, foreign (...truncated)