Journal of Education and Health Promotion

Targeted subsidy plan and Kakwani index in Iran health system

Document Type : Original Article

Authors

. Jafar Yahyavi Dizaj
. Zohreh Anbari 1
. Ali Kazemi Karyani 2
. Yousef Mohammadzade 3

1 Associate Professor in Health Services Management, Department of Health Services Management, Public Health School, Arak University of Medical Sciences, Arak, Iran

2 Research Center for Environmental Determinants of Health, Health Institute, Kermanshah University of Medical Sciences, Kermanshah, Iran

3 Associate Professor, Department of Economics, Urmia University, Urmia, Iran

Abstract
INTRODUCTION: Health care is considered as a human right, and fair financial contribution to health
care plays an important role in providing effective services for all members of society. This study
aimed at investigating the effects of targeted subsidy plan (since 2010) on equality in health‑care
financing in Iran from 2004 to 2014.
MATERIALS AND METHODS: This was a descriptive‑analysis, cross‑sectional study that was
conducted using data obtained from households’ expenditure‑income survey that is performed every
year by the Statistical Center of Iran. The Lorenz curve, Gini coefficient, and  Theil index were applied
to measure inequality in  healthcare expenditures (HEs). Furthermore, the Kakwani index was used
to examine inequality in health‑care finance during the study period. The analysis was performed
using Stata version 13.
RESULTS: Kakwani index was negative for all the studied years, except 2007. The value of this
index was equal to −0.032, −0.045, and −0.046 in 2004, 2008, and 2014 for rural areas and was
equal to −0.041, −0.029, and −0.0001 for urban areas, respectively. Despite the Kakwani index has
been negative for most of the years, which reflects regressive financing in health care, there is no
significant change in the trend of this indicator after the implementation of the subsidies. In addition,
this indicator is moving toward being positive (progressive) in urban areas in 2014, which represents
increased share of the poor in health payments.
CONCLUSIONS: According to the results, the targeted subsidy plan could not reach to its purpose in
health‑care system for supporting the poor from HEs. It is recommended for policy‑makers to design
a specific plan for health‑care financing and to allocate some defined resources such as taxes or
subsidies to health‑care sector.

Keywords

Equality
health‑care costs
net household expenditures
targeted subsidies law
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Journal of Education and Health Promotion
Volume 9, Issue 5
May 2019
Pages 1-9

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