Out-of-pocket payments and income-related inequality in unmet medical needs: within-country evidence from Central and Eastern Europe
This study demonstrates that in Central and Eastern European countries, higher out-of-pocket payment shares significantly widen income-related inequalities in unmet medical needs, primarily by disproportionately preventing low-income individuals from accessing care due to cost.
Original paper licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/). This is an AI-generated explanation of the paper below. It is not written or endorsed by the authors. For technical accuracy, refer to the original paper. Read full disclaimer
In the landscape of modern healthcare, a promise is often made that medical care is a right, not a privilege. In many nations, particularly across Central and Eastern Europe, governments have built systems where every citizen is formally entitled to see a doctor or receive treatment, regardless of their bank account. This is the concept of universal coverage: a safety net designed to catch everyone. Yet, a gap often exists between what is promised on paper and what a person can actually access in reality. This gap widens when people are asked to pay for their own care at the moment they need it. These direct payments, known as out-of-pocket costs, can range from small fees for a prescription to larger sums for dental work or specialist visits. When these costs are high, they act as a barrier, preventing people from getting the care they need. The question researchers have long asked is whether these financial hurdles are the primary reason why the poor go without care while the rich do not, even in countries that claim to offer free healthcare to all.
A new study by Paweł Prędkiewicz, an economist at Wroclaw University of Economics and Business, investigates this exact puzzle within eleven countries in Central and Eastern Europe. These nations, including Bulgaria, Poland, and Romania, share a history of state-run healthcare that transitioned into modern systems. While they all maintain the formal rule that healthcare is universal, they differ significantly in how much they rely on patients to pay for it directly. Some countries have kept these direct payments relatively low, while others have shifted a large portion of the financial burden onto individuals, with out-of-pocket payments making up nearly a quarter of all health spending in the region. Prędkiewicz wanted to know if this reliance on personal payment explains why the poorest citizens are far more likely to skip medical visits due to cost than the wealthiest ones. To find the answer, he did not look at a single snapshot in time but examined a long timeline of data, tracking changes within each country over nearly two decades, from 2009 to 2023.
The researcher gathered data on two main things: how much of the health budget in each country came from people's own pockets, and how many people in different income groups reported that they needed medical care but could not get it. He specifically looked at the difference between the poorest fifth of the population and the richest fifth. By analyzing how this gap changed whenever a country's reliance on out-of-pocket payments shifted, he could isolate the effect of money from other factors like the number of doctors available or the distance people had to travel. The study found a clear and direct link: when a country increased its share of out-of-pocket payments, the gap between the rich and the poor in unmet medical needs grew significantly. Specifically, for every single percentage point increase in the share of health spending paid directly by patients, the difference in unmet needs between the poorest and richest groups widened by nearly half a percentage point. This means that as the financial burden on patients grew, the poorest citizens were increasingly left behind, while the wealthy remained largely unaffected.
Crucially, the study ruled out other common reasons for people missing care. The researcher checked whether the increase in unmet needs was caused by long waiting lists or by clinics being too far away. The data showed no such connection. When out-of-pocket payments rose, the number of people skipping care because it was "too expensive" went up, but the number of people skipping care due to waiting lists or travel distance did not change. This distinction is vital because it confirms that the barrier is purely financial, not organizational. The effect was not uniform across the population either; it hit the poorest people the hardest. The response to rising costs was strongest for those in the bottom income group and faded steadily as income increased. Even the wealthiest citizens showed a tiny reaction to higher costs, but it was negligible compared to the struggle faced by the poor. In fact, the financial barrier was so potent that it accounted for almost all of the inequality observed; nearly 98 percent of the widening gap between rich and poor was driven specifically by the cost of care.
The findings suggest that in systems where healthcare is officially free, the real access to that care is determined by how the system is funded. When a country shifts more of the cost onto patients, it does not just make healthcare more expensive for everyone; it actively creates a divide where the poor are priced out of the system. The study highlights that this is not a temporary issue or a result of bad luck, but a structural feature of how these health systems are designed. The research points to specific levers that policymakers can pull to fix this: expanding what is covered by public insurance, redesigning how costs are shared so they do not fall on the most vulnerable, and creating stronger protections based on income. The evidence shows that without these changes, the promise of universal healthcare remains incomplete, leaving a significant portion of the population unable to access the care they need simply because they cannot afford to pay for it.
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