A million Ugandans impoverished annually due to costly healthcare     

World Bank says many Ugandans slide into poverty annually due to costly healthcare spending. Photo / File 

What you need to know:

  • A World Bank report indicates that close to a million Ugandans, which represents 206,405 households, are impoverished annually due to costly out-of-pocket spending on health

Close to a million Ugandans get impoverished annually due to out-of-pocket spending on health, according to a World Bank report. 

The report, released under the theme: Improving public spending to improve human capital, in Kampala last Thursday, indicates that whereas the incidence of households falling below the poverty line due to out-of-pocket spending on health had declined over the years “there is an urgent need to further enhance financial risk protection, especially for rural households”.

The details, contained in the 23rd Edition of the World Bank Uganda Economic Update, indicate that in the four years to 2020, at least an average of 206,405 households, which represents 949,464 people were pushed below the national poverty line, while 233,328 households or 1.1 million people, fell below the international poverty line.

However, the report noted that based on Uganda’s national poverty line, the share of impoverished households due to out-of-pocket spending on health had in the four years to 2020 fallen from 4.6 percent in the 2005/06 financial year to 2.3 percent in the 2019/20 financial year but remained a key challenge to human capital development in the country.

The World Bank also noted that Uganda’s health spending amounted to just 1.3 percent of gross domestic product or 7.2 percent of total public expenditure during the period, with government contributing less than 20 percent of all health spending, while external assistance accounted for about 50 percent and out of pocket spending financing contributing at least 30 percent. 

“The distribution may not be sustainable given the country’s rapidly growing population … increasing public health spending is vital to ensure sustainable and inclusive development,” the World Bank noted, highlighting that increasing government spending was vital to mitigate the uncertainty around external financing and reduction on the burden of out of pocket health spending by households.

The report found that out-of-pocket spending on health had impacted more rural households than their urban folks, noting that based on the international poverty line, the share of impoverished rural households stood at 181,374 or 870,597 people in the four years, while just 51,677 households or 206,709 people were impoverished in urban setups. 

“These findings imply that though impoverishment due to health spending has reduced over the years in Uganda, there is an urgent need to further enhance financial risk protection, especially for rural households,” the report recommends 

The report further highlights the challenge of accessing medicine in Uganda, noting that in 2022, only 49 percent of health facilities across the country had all essential medicines available.

The inadequate supply of medicines and medical supplies, the report noted, is likely due to a combination of low spending and widespread theft, indicating that a government study on the extent and cost of corruption in the health sector had revealed that the theft of medicines is rampant at public health facilities, which leads to direct monetary losses and increases out-of-pocket spending. 

“While those who needed health services typically received them, two-thirds paid out of pocket for health services, with the richest households spending the most,” the report noted.  

Monitor could not readily get a comment on how the Ministry of Health or government plan to address World Bank recommendations, among which include increasing healthcare spending.