The measurement of costs and income involves numerous challenges. Dissaving is, by comparison, easier to measure, indicates by definition a financial weakening of a household, and is a widely-used coping strategy [18]. It is therefore a potential proxy for catastrophic costs in routine monitoring and evaluation. We analyse the link between dissaving, costs, income, and catastrophic costs, using data collected in three countries across two continents,. The first part of our analysis explores the link between extreme cost and several potential explanatory variables, including dissaving. Our motivation was that cost distributions are commonly ‘fat-tailed’, reflecting high prevalence of ‘extreme’ costs likely to lead to financial hardship. We use median cost as a yardstick to identify extreme costs as it is simple to calculate and reflects costs typically faced by others in the same location. Hospitalisation was associated with extreme costs in Bangalore, and with high/extreme costs in Tanzania, Bangladesh, which had the lowest rate of hospitalisation, also had the lowest prevalence of extreme costs. This suggests that that service delivery models minimising hospitalisation should be prioritised, and financial protection offered when hospitalisation is unavoidable, which is consistent with previous findings that inefficient patient management can be a major cause of catastrophic health expenditure [1]. Income was not associated with extreme costs in Bangalore or high/extreme costs in Tanzania. Even in Bangladesh, where there was an association between high/extreme cost and income band, two of the three respondents reporting extreme costs also reported low income. Dissaving (at any level) was associated with extreme costs in Bangalore, but the relationship between dissaving and cost band was not significant in other locations. This may be due to the sample size, but might also be related to the fact that dissaving was more prevalent in Bangladesh (53 %) and Tanzania (61 %) than in Bangalore (37 %). Monitoring whether or not TB patients dissave is less likely to be sufficient in locations where it is commonplace.
There are two concerns with benchmarking against median costs as a tool for monitoring and evaluation. Firstly, interventions to reduce median costs will reduce the absolute value of thresholds based on it. A solution to this might be to benchmark against a stable measure such as a pre-defined context-specific measure of costs reflecting what is tolerable by poor households. Secondly, this does not take income, and hence ability to pay, into account. Our analysis suggests this may not be a major concern, since income is not strongly associated with cost, although this may not be true in every setting. All 157 respondents reporting extreme costs in Bangalore also reported a cost/income ratio greater than 40 %. Households facing ‘extreme’ costs are therefore largely a subset of those facing catastrophic costs; identifying and addressing drivers of ‘extreme’ costs (other than income variation) can therefore be seen as a stepping-stone towards the goal of eliminating catastrophic costs entirely.
We found consistent evidence of associations between cost-income ratios and both the presence and level of dissaving. In Bangalore, the probability of dissaving increased with costs and decreased with income, and there was a strong association between the amount of dissaving and the cost-income ratio, which supports using the former as a proxy for catastrophic costs. Evidence from Bangladesh and Tanzania was less conclusive, largely because these were smaller studies, and collected income data as bands rather than actual amounts. Even so, there were several statistically significant associations consistent with a relationship between dissaving and catastrophic cost, and none inconsistent with such a relationship. However, the sample size and lack of precise values for income are limitations, as is the fact that none of the studies whose data we used were explicitly designed to evaluate the use of dissaving as a proxy for catastrophic costs. In particular, data from Bangladesh and Tanzania are not available for the first 2 months of the continuation phase (months 3 and 4). This is more likely to be a significant issue for calculating dissaving than costs, as little is known about the timing of asset sales and uptake of loans, whereas it is more reasonable to assume that costs are spread evenly throughout the continuation phase. Given these limitations, further research is required to validate the use of dissaving as an indicator of catastrophic costs, and to explore the timing of dissaving relative to the incurring of costs. Further evidence is also required on how universally dissaving measures could be applied – in some settings, for example, there may be cultural barriers to the take-up or reporting of loans.
Our analysis suggests that dissaving can be a useful indicator in the evaluation and monitoring of financial protection and service delivery interventions aimed at reducing catastrophic costs. Further evidence would inform how this indicator is used – we expect it will supplement other measures of financial distress where available. Such measures could be used in combination to identify catastrophic costs, for example by comparing the amount of dissaving to the total amount of healthcare expenditure, using empirically determined thresholds. Dissaving may also capture financial distress that is not reflected in cost-income ratios, for example when households face multiple illnesses that are catastrophic together but not singly [6].
Our results also illustrate different strategies for dissaving – dissavers in Tanzania, for example, were more likely to sell assets than in Bangladesh or Bangalore. It is likely that the nature of dissaving will influence its relationship to financial hardship. It may therefore be useful to distinguish between types of dissaving when using this measure as a signal for financial distress. For example, it may be possible to distinguish between ‘planned dissaving’ and ‘distressed dissaving’. The former would involve measures designed for protecting households from financial shocks (e.g. cash savings, jewellery, or low-interest loans). The latter would involve dissaving actions that households adopt due to a lack of alternatives, despite significant immediate consequences for household well-being. Those who take out high-interest loans, or sell assets that generated a high proportion of household income, for example, would seem to be at greatest risk of failing to meet basic subsistence needs as a result. A further aim for future research would be to explore the relationship between the type of dissaving and the consequences for household wellbeing, in order to enhance the value of dissaving measures as an indicator of catastrophic cost.