Poverty & health: Criticality of public financing

Countries with universal or near universal access to healthcare have health financing mechanisms which are single-payer systems in which either a single autonomous public agency or a few coordinated agencies pool resources to finance healthcare. This contributes to both equity in healthcare as well as to low levels of poverty in these countries. It is only in countries like India and a number of developing countries, which still rely mostly on out-of-pocket payments, where universal access to healthcare is elusive. In such countries those who have the capacity to buy healthcare from the market most often get healthcare without having to pay for it directly because they are either covered by social insurance or buy private insurance. In contrast, a large majority of the population, who suffers a hand-to-mouth existence, is forced to make direct payments, often with a heavy burden of debt, to access healthcare from the market because public provision is grossly inadequate or non existent. Thus, the absence of adequate public health investment not only results in poor health outcomes but it also leads to escalation of poverty. This article critically reviews the linkages of poverty with healthcare financing using evidence from national surveys and concludes that public financing is critical to good access to healthcare for the poor and its inadequacy is closely associated with poverty levels in the country.