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[2E202] Determinants of health financing strategy selection to cope with a health shock: A case study in rural Cambodia
Keywords:health financing, risk-coping mechanism, social health protection, loss aversion, time discount rate
Determinants of health financing strategy selection to cope with a health shock: A case study in rural Cambodia
Seiichi FUKUI, Kobe University, Member of JASID
Kana MIWA , Nagasaki University, Member of JASID
Abstract
Borrowing with interest or selling assets is some strategies used by households to meet healthcare costs in countries with underdeveloped social health protection systems; here, out-of-pocket expenditure is the main source of health expenditure. However, borrowing with interest and/or asset sales can push households into financial jeopardy. This study investigates the determinants of selecting a health financing strategy using the data collected in rural Cambodia. First, we hypothesize that the financing cost depends on the demand for finance and financial ability of each household. We also assume that the highest health financing cost is for borrowing with interest, followed by asset sale, gifts, and payments from their own income and savings. Then, based on this categorization, we analyze the data using ordered logit analysis. We find that the higher the education level, the lower the likelihood that households will select borrowing with interest and asset sale to pay healthcare costs. Conversely, the higher the healthcare costs, the more likely that households will select borrowing with interest and asset sale. Next, the lower the degree of loss aversion and higher the time discount rate, the greater the likelihood of households selecting borrowing with interest and asset sale. Overall, these findings contribute to research on health financing and social health protection.
Seiichi FUKUI, Kobe University, Member of JASID
Kana MIWA , Nagasaki University, Member of JASID
Abstract
Borrowing with interest or selling assets is some strategies used by households to meet healthcare costs in countries with underdeveloped social health protection systems; here, out-of-pocket expenditure is the main source of health expenditure. However, borrowing with interest and/or asset sales can push households into financial jeopardy. This study investigates the determinants of selecting a health financing strategy using the data collected in rural Cambodia. First, we hypothesize that the financing cost depends on the demand for finance and financial ability of each household. We also assume that the highest health financing cost is for borrowing with interest, followed by asset sale, gifts, and payments from their own income and savings. Then, based on this categorization, we analyze the data using ordered logit analysis. We find that the higher the education level, the lower the likelihood that households will select borrowing with interest and asset sale to pay healthcare costs. Conversely, the higher the healthcare costs, the more likely that households will select borrowing with interest and asset sale. Next, the lower the degree of loss aversion and higher the time discount rate, the greater the likelihood of households selecting borrowing with interest and asset sale. Overall, these findings contribute to research on health financing and social health protection.
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