Demand for private healthcare in a universal public health care system. Empirical evidence from Sri Lanka by Asankha Pallegedara and Michael Grimm. The paper has been published by Health Policy and Planning which is one of the leading journals in “Health Policy and Services”. It is edited by the London School of Hygiene and Tropical Medicine and has an Impact Factor of 2.368.
Asankha Pallegedara is a post-doctoral fellow at the Chair of Development Economics. He is holder of an Alexander von Humboldt Fellowship.
Abstract
This paper examines health care utilization behavior in Sri Lanka with special emphasis on the choice between costly private and free public health care services. We use a data set that combines nationwide household survey data and district level health care supply data. Our findings suggest that even with universal public health care policy, richer people tend to use private sector health care services rather than public services. We also find significant regional and ethnic discrepancies in health care access bearing the risk of social tensions if these are further amplified. Latent class analysis shows in addition that the choice between private and public sector healthcare significantly differs between people with and without chronic diseases. We find in particular that chronically ill people rely for their day-to-day care on the public sector, but for their inpatient care they turn more often than non-chronically ill people to the private sector, implying an additional financial burden for the chronically ill. If the observed trend continues it may not only increase further the health-income gradient in Sri Lanka but also undermine the willingness of the middle class to pay taxes to finance public health care.