Out-of-pocket health burden remains high
When people need health care—from a routine checkup to life-saving treatment—they often have to pay for it directly. Out-of-pocket (OOP) payments remain one of the most common ways health systems are financed. Promisingly, the share of total health spending financed by OOP payments has fallen over the past two decades as more countries expand public and pooled financing schemes. But progress is uneven. Many health systems are still heavily reliant on OOP payments, leaving households exposed to financial hardship and unmet health needs.
In 2022, OOP payments remained the largest source of health spending in 39 countries—home to approximately a third of the world’s population. In 27 of those countries, OOP payments accounted for more than half of all health spending. In parts of Africa, the reliance is especially stark: in Nigeria, Equatorial Guinea, and Cameroon, over two-thirds of health expenditure is paid out-of-pocket.
The risks associated with high reliance on OOP payments aren’t confined to poorer countries. Even in wealthier countries, this reliance can deepen inequalities. Within the European Union, studies show that OOP payments contribute to financial hardship and unmet health needs, especially among poorer households. Those with the fewest resources shoulder the heaviest burden.
OOP spending is one of the most inequitable ways to finance health care. Families without resources often deplete savings, sell assets, or cut spending on other essentials like food, education, and housing to cover medical bills. Others avoid treatment altogether, leaving health needs unmet. Health systems’ reliance on OOP payments forces financial risks onto households and blocks progress toward universal health coverage. Sustainable public financing, pooling of resources, and stronger financial protection policies are essential to shift that burden away from families.
Use The ONE Data Agent™ to explore more data on how health care is financed.
A note on interpreting OOP health spending
This analysis presents out-of-pocket (OOP) health care expenditure as a share of total health expenditure. This measure highlights how much health systems rely on direct household payments relative to other financing mechanisms, including pooled or prepaid financing through governments, private, or external sources (as defined in the System of Health Accounts, SHA2011). However, there are important considerations when interpreting this measure in the analysis:
- A lower OOP share does not necessarily indicate that households are spending less in absolute terms. OOP payments in monetary terms have generally been rising, and there is significant variation in overall health expenditure across countries.
- OOP share of total health spending does not capture the cost or affordability of health care, the availability of services, or the efficiency of health systems. It also doesn’t capture unmet health needs among households that do not access health care services.
- This analysis relies on country-level data. Similar to income-level aggregates, the distribution of financial risk and burden within populations is masked. As noted in the analysis, poorer households generally face a larger financial burden and risk.
- This analysis does not assess overall household income which is important for understanding the full impact of OOP payments on financial risk. Measures including catastrophic and impoverishing health spending are important for assessing progress on universal health coverage (UHC) and the SDGs.