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Reflections on and alternatives to WHO's fairness of financial contribution index

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  • Adam Wagstaff
Abstract
In its 2000 World Health Report (WHR), the World Health Organization argues that a key dimension of a health system's performance is the fairness of its financing system. This paper provides a critical assessment of the index of fairness of financial contribution (FFC) proposed in the WHR. It shows that the index cannot discriminate between health financing systems that are regressive and those that are progressive, and cannot discriminate between horizontal inequity on the one hand, and progressivity and regressivity on the other. The paper compares the WHO index to an alternative and more illuminating approach developed in the income redistribution literature in the early 1990s and used in the late 1990s to study the fairness of various OECD countries' health financing systems. It ends with an illustrative empirical comparison of the two approaches using data on out‐of‐pocket payments for health services in Vietnam for two years – 1993 and 1998. This analysis is of some interest in its own right, given the large share of health spending from out‐of‐pocket payments in Vietnam, and the changes in fees and drug prices over the 1990s. Copyright © 2002 John Wiley & Sons, Ltd.

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  • Adam Wagstaff, 2002. "Reflections on and alternatives to WHO's fairness of financial contribution index," Health Economics, John Wiley & Sons, Ltd., vol. 11(2), pages 103-115, March.
    • Handle: RePEc:wly:hlthec:v:11:y:2002:i:2:p:103-115
    DOI: 10.1002/hec.685
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    Cited by:

    1. Wagstaff, Adam & Pradhan, Menno, 2005. "Health insurance impacts on health and nonmedical consumption in a developing country," Policy Research Working Paper Series 3563, The World Bank.
    2. Aurelio Mejía, 2013. "Is tax funding of health care more likely to be regressive than systems based on social insurance in low- and middle-income countries?," Publicaciones 15615, Grupo de Economía de la Salud.
    3. Augustine Asante & Jennifer Price & Andrew Hayen & Stephen Jan & Virginia Wiseman, 2016. "Equity in Health Care Financing in Low- and Middle-Income Countries: A Systematic Review of Evidence from Studies Using Benefit and Financing Incidence Analyses," PLOS ONE, Public Library of Science, vol. 11(4), pages 1-20, April.
    4. Rothgang, Heinz & Cacace, Mirella, 2005. "Fair financing in Germany's public health insurance: income-related contributions or flat premiums," TranState Working Papers 26, University of Bremen, Collaborative Research Center 597: Transformations of the State.
    5. Roy, Kakoli & Howard, David Hill, 2007. "Equity in out-of-pocket payments for hospital care: Evidence from India," Health Policy, Elsevier, vol. 80(2), pages 297-307, February.
    6. Mulenga, Arnold & Ataguba, John Ele-Ojo, 2017. "Assessing income redistributive effect of health financing in Zambia," Social Science & Medicine, Elsevier, vol. 189(C), pages 1-10.
    7. Elias Mossialos & Sara Allin & Konstantina Davaki, 2005. "Analysing the Greek health system: a tale of fragmentation and inertia," Health Economics, John Wiley & Sons, Ltd., vol. 14(S1), pages 151-168, September.
    8. Meri Koivusalo & Maureen Mackintosh, 2008. "Forum 2008," Development and Change, International Institute of Social Studies, vol. 39(6), pages 1163-1169, November.
    9. Wagstaff, Adam & Doorslaer, Eddy van, 2001. "Paying for health care : quantifying fairness, catastrophe, and impoverishment, with applications to Vietnam, 1993-98," Policy Research Working Paper Series 2715, The World Bank.
    10. Abu-Zaineh, Mohammad & Mataria, Awad & Luchini, Stéphane & Moatti, Jean-Paul, 2008. "Equity in health care financing in Palestine: The value-added of the disaggregate approach," Social Science & Medicine, Elsevier, vol. 66(11), pages 2308-2320, June.
    11. Swadhin Mondal, 2018. "Health Policy Changes and Its Effect on Equity in Healthcare Financing in India," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 16(3), pages 709-725, September.
    12. Abu-Zaineh, Mohammad & Mataria, Awad & Luchini, Stéphane & Moatti, Jean-Paul, 2009. "Equity in health care finance in Palestine: The triple effects revealed," Journal of Health Economics, Elsevier, vol. 28(6), pages 1071-1080, December.
    13. Härpfer, Marco & Cacace, Mirella & Rothgang, Heinz, 2009. "And fairness for all? Wie gerecht ist die Finanzierung im deutschen Gesundheitssystem? Eine Berechnung des Kakwani-Index auf Basis der EVS," Working papers of the ZeS 04/2009, University of Bremen, Centre for Social Policy Research (ZeS).
    14. Mejía Mejía, Aurelio, 2013. "Is tax funding of health care more likely to be regressive than systems based on social insurance in low and middle-income countries?," Revista Lecturas de Economía, Universidad de Antioquia, CIE, issue 78, pages 229-239, March.
    15. Chaudhuri, Anoshua & Roy, Kakoli, 2008. "Changes in out-of-pocket payments for healthcare in Vietnam and its impact on equity in payments, 1992-2002," Health Policy, Elsevier, vol. 88(1), pages 38-48, October.
    16. Hao Dong & Zhenghui Li & Pierre Failler, 2020. "The Impact of Business Cycle on Health Financing: Subsidized, Voluntary and Out-of-Pocket Health Spending," IJERPH, MDPI, vol. 17(6), pages 1-24, March.
    17. Chantzaras, Athanasios E. & Yfantopoulos, John N., 2018. "Financial protection of households against health shocks in Greece during the economic crisis," Social Science & Medicine, Elsevier, vol. 211(C), pages 338-351.

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