Mobilizing Resources for Health: The Case for User Fees Revisited

Abstract

During the 1980s and 1990s, health sector reforms to improve the efficiency of health systems and the quality of care provided were implemented in low-income countries, mainly in Africa. The reforms included the introduction or consolidation of cost recovery mechanisms, otherwise known as user fees. The paper provides evidence from the literature that in most instances user fees had the unintended effect of decreasing access to health care by the poor. It argues that user fees, in addition to having been largely unsuccessful in raising significant resources, greatly contributed to increasing the exposure of poor households to the financial risks associated with illness. A major conclusion is that alternate financing mechanisms are required to provide financial risk protection to low-income households, particularly to those in the informal sector.