Out of Pocket and Catastrophic Health Expenditure in Tanzania: Recent Evidence on the Incidence, Intensity and Distribution

Abstract Background Health care in most of the low-income countries (LICs) is financed mainly by out-of-pocket (OOP) expenditures. However, it is contentious that this payment mechanism tends to cause a massive burden on poor households. This study investigates the catastrophic impact of out-of-pocket health expenditures in Tanzania. Specifically, the study estimates catastrophic health expenditure levels, intensity and distribution.Methods Using the panel dataset of 2020/2021, the study applied descriptive analytical methods such as frequencies, means, proportions and concentration indices to investigate the incidence, intensity and distribution of catastrophic health expenditure in Tanzania.Results The study found that 21.9% (19.1% from rural and 24.6% from urban) of the respondents reported visiting a healthcare facility within four weeks before the survey. Over 50% (53.5% from rural and 57.4% from urban) reported an incidence of illness or injury within the same period. The study also found that among those who utilized health care, about 7.1% (8.4% from rural and 5.7% from urban areas) experienced catastrophic health expenditures. The results of the concentration index indicate that poor households have a higher probability of incurring catastrophic health expenditures than rich households, which is evident in the context of Tanzania, where health insurance is in the embryo stage of development.Conclusion We conclude that out-of-pocket health expenditures tend to lead to financial catastrophe for poor households, thereby exposing them to more poverty and forcing them to resort to coping mechanisms that compromise their welfare. This calls for a need to explore new and strengthened existing mechanisms for shielding poor households against out-of-pocket and catastrophic health expenditures.