To what extent do public and private financing sources affect access and quality of health care? Experiences from Uganda’s healthcare system

At the 58th World Health Assembly in 2005, world leaders committed to attaining universal health coverage (UHC) for their populations. Henceforth goal 3.8 of the UN Sustainable Development Goals defines the priority areas to achieve UHC goals – equity in the use of health services, quality of care and financial protection, by 2030. Consequently, the key functions of a health financing system – revenue raising, pooling and purchasing, are at the core of a country’s progress towards achieving UHC. The World Health Organisation has argued that in order to provide access to good quality health care services for all members of the population, the health financing system should avoid catastrophic health expenditure caused by large out-of-pocket payments and user fees; they dampen demand and create barriers to access especially for the poor. Typically, in Uganda, domestic private health expenditure is the dominant source of health sector financing contributing more than 50% of the total current health expenditure, with 40% as household out-of-pocket payments. We employed an Autoregressive Distributed Lag (ARDL) model to estimate the relationship between health care financing sources and health outcomes using a health access and quality index as a proxy for health outcome. In our analysis, we posited that preventable (treatable) causes of death are a good measure of access to healthcare and quality of healthcare in the health system. We constructed a healthcare access and quality index based on three health indicators: Under-five mortality, DPT3 coverage, and Immunization against measles in Uganda, using the principal component analysis method. The index ranges between 0 and 100 whereby moving towards 100 signifies increasing level of health care access and quality. The study finds that an increase in the ratio of private to government health care financing has different impacts in the short run and long run. While in the short-run it increases access and quality of health care, in the long run it reduces access and quality of health care. The findings suggest that reliance on private health care financing is not sustainable in the long run, if the country is to achieve the universal health coverage goals by 2030. Therefore, government ought to increase its share of health care financing to avoid the negative impact of relying on private health care financing in the long run.