Catastrophic Health Expenditure and Household Well-Being

Abstract

According to the catastrophic health expenditure methodology a house- hold is in catastrophe if its health out-of-pocket budget share exceeds a critical threshold. We develop a conceptual framework for addressing three questions in relation to this methodology, namely: 1. Can a budget share be informative about the sign of a change in welfare? 2. Is there a positive association between a household�s poverty shortfall and its health out-of- pocket budget share? 3. Does an increase in population coverage of a health insurance scheme always result in a reduction of the prevalence of catastrophic expenditures?Catastrophic health expenditure; welfare change; poverty; performance of health insurance schemes