ABSTRACT
CONTENTS 20.1 Introduction................................................................................. 406 20.2 Characterizing Catastrophic Healthcare Expenditures .................. 409
20.2.1 Defining Catastrophic Risks ........................................... 409 20.2.2 Drug-Related Catastrophic Risks.................................... 411 20.2.3 Country Experience with Catastrophic Payments........... 411
20.3 Measuring Catastrophic Healthcare Expenditures ........................ 412
20.4 Empirical Illustration.................................................................... 413 20.4.1 Catastrophic Risks in Developing Countries:
Nicaragua ....................................................................... 413 20.4.2 Indirect Estimation of Catastrophic Risks ...................... 414 20.4.3 Direct Imputation of Catastrophic Risk Prevalence........ 416
20.5 Conclusion................................................................................... 416 References ............................................................................................... 417
20.1 Introduction Access to healthcare, including essential drugs, is not only a human right but also a central issue in health policy reform in developing countries. Although containing health expenditures is at the top of the debate in developed countries, developing countries are much more concerned with improving accessibility to healthcare (Murray et al., 1994). Yet, given the limited health insurance coverage in developing countries, for healthcare (and drugs) to be financially accessible, the total of these costs must be such that it does not become a disproportionate burden for any family. This holds because a large part of the health expenditures are borne either by individuals themselves or by the private health insurer. As Table 20.1 reveals, per capita expenditure on health varies greatly, from $36 for sub-Saharan Africa to nearly $1675 per capita in established market economies. Furthermore, the share of the private sector increases with the lack of development, as Table 20.1 highlights.
