Health financing

Monitoring Sustainable Development Goals –Indicator 3.8.2

Financial protection is a key dimension of universal health coverage (UHC) and needs to be monitored within the framework of the Sustainable Development Goals (SDGs). SDG Target 3.8 has two indicators.

Figure on SDGs target 3.8 Achieve universal health coverage

Indicator 3.8.2 of the SDGs concerns the financial protection dimension of universal health coverage. It corresponds to one definition of catastrophic spending on health based on the budget share approach. This indicator captures the impact of health spending paid “out-of-pocket” on household’s budget which could imply for some families choosing between health and other essentials like food, and education.

Indicator name and number

(SDG 3.8.2) Proportion of the population with large household expenditure on health as a share of total household expenditure or income. Two thresholds are used to define “large household expenditure on health”: greater than 10% (SDG 3.8.2_10) and greater than 25% of total household expenditure or income (SDG 3.8.2_25).

Method of estimation

Population weighted average number of people with large household expenditure on health as a share of total household expenditure or income (e.g. greater than 25%).

Method of estimation formula for the SDGs Indicator 3.8.2. Lack of financial protection coverage in health.

Where i denotes a household, 1() is the indicator function, wi corresponds to the household’s sample weights multiplied by the household size to obtain representative numbers per person, τ is a threshold identifying disproportionate spending on health (e.g. 10%). If the sample is self-weighting, then the household size is used as the weight in computation.

Indicator 3.8.2 is based on a health expenditure ratio. To construct the numerator (household expenditure on health) the definition of out-of-pocket payments following the classification of health care financing schemes (HF.3) as per the international Classification for Health Accounts (ICHA-HF) should be followed. The components of the numerator (household expenditure on health) should follow the structure proposed in division 06 of the 2018 UN classification of Individual Consumption according to Purpose (COICOP). The denominator of indicator 3.8.2 (household total expenditure or income) should capture consumption across all the goods and services proposed by (COICOP).

Disaggregation

Disaggregation by income, sex, age, and geographic location, in accordance with the disaggregation principle of the SDGs.

Data sources

The estimation of indicator 3.8.2 at country level is based on nationally representative household surveys with information on household expenditure on health and total household expenditure or income such as household budget surveys, household income and expenditure surveys or socio-economic/living standard surveys. These surveys serve multiple sectors and are regularly used for the purposes of monitoring poverty as for the MDGs or calculating weights for the Consumer Price Index. Thus, data can be gathered in a cost-effective manner.

Measurement frequency

Varies across countries following nationally-led schedules of household surveys (annual to up to every 5 years).

Further information

Detailed information on the methodology used to produce indicator 3.8.2 is available from the following sources: