Hardship Financing, Productivity Loss, and the Economic Cost of Illness and Injury in Cambodia

Robert John Kolesar (1, 2, 3, 4) , Guido Erreygers (2) , Wim van Dam (5) , Vanara Chea (3) , Theany Choeurng (3) , Soklong Leng (3)

1 Abt Associates
2 UA - University of Antwerp
3 Cambodian Ministry of Economy and Finance
4 CERDI - Centre d'Études et de Recherches sur le Développement International
5 ITM - Institute of Tropical Medicine [Antwerp]

Financial risk protection is a core dimension of Universal Health Coverage. Hardship financing, defined as borrowing and selling land or assets to pay for healthcare, is a measure of last recourse. To inform efforts to improve Cambodia's social health protection system we analyze 2019-2020 Cambodia Socioeconomic Survey data to assess hardship financing, illness and injury related productivity loss, and estimate related economic impacts. We apply two-stage Instrumental Variable multiple regression to address endogeneity relating to net income. More than 98,500 households or 2.7% of the total population resorted to hardship financing over the past year. Factors significantly increasing risk are having an Equity card, higher out-of-pocket healthcare expenditures, illness or injury related productivity loss, and spending of savings. The economic burden from annual lost productivity from illness or injury amounts to USD 459.9 million or 1.7% of GDP. The estimated household economic cost related to hardship financing is USD 250.8 million or 0.9% of GDP. Such losses can be mitigated with policy measures such as linking a catastrophic health coverage mechanism to the Health Equity Funds, capping interest rates on health-related loans, and using loan guarantees to incentivize microfinance institutions and banks to refinance health-related, high-interest loans from money lenders.

Mots clés: social health protection; poverty; financial risk protection; Universal Health Coverage; hardship financing

Domaines: Economies et finances; Santé publique et épidémiologie

Robert John Kolesar, Guido Erreygers, Wim van Dam, Vanara Chea, Theany Choeurng, et al.. Hardship Financing, Productivity Loss, and the Economic Cost of Illness and Injury in Cambodia. 2021. ⟨hal-03437399⟩