Achieving universal health coverage by 2030 is a key target of the Sustainable Development Goals, and progress toward it depends on two pillars: the range of services people can actually access and the financial protection they enjoy while using them. A new study published in BMC Health Services Research examines how the composition of national health financing, specifically the share of health spending that comes directly from households, relates to the universal health coverage service coverage index across a large and diverse set of countries. The findings suggest that this relationship is not uniform but shifts markedly with a country’s income level.
The research team, led by Mohammod Akbar Kabir and colleagues, analyzed a balanced panel of 147 countries spanning the years 2015 to 2023. Their outcome of interest was the UHC service coverage index, a composite measure that captures the extent to which a population is covered by essential health services. The main exposure was out-of-pocket health expenditure expressed as a percentage of current health expenditure, a metric that reflects how national health systems are financed rather than the burden that individual households bear at the point of care. The authors are careful to distinguish this macro-level financing composition from household-level out-of-pocket spending or per-capita out-of-pocket expenditure, which are related but distinct concepts.
To model the relationship, the researchers employed a fractional logit generalized estimating equation model with an autoregressive order-one correlation structure. This approach is suited to an outcome that is a proportion bounded between zero and one, and the generalized estimating equation framework yields population-averaged estimates, meaning the coefficients describe average associations across the population of countries rather than effects for any single nation. The autoregressive structure accounts for the fact that observations from the same country in consecutive years are more alike than observations from different countries, a common feature of panel data.
Beyond the financing composition variable, the model included several covariates that could confound or modify the association: gross domestic product per capita, population size, the share of the population aged 65 and older, external health expenditure, and the Corruption Perception Index as a proxy for governance quality. By adjusting for these demographic, economic, governance and temporal factors, the analysis sought to isolate the association between out-of-pocket financing and service coverage from the influence of broader national characteristics.
The descriptive statistics alone paint a striking picture of global variation. Across the 147 countries, UHC service coverage index values ranged from a low of 23 percent to a high of 92 percent, with an average of 65.28 percent. Out-of-pocket expenditure as a share of current health expenditure varied even more dramatically, from 2.98 percent in some systems to 84.79 percent in others, averaging 34.02 percent. This wide spread underscores how differently countries finance their health systems, even when they face similar epidemiological challenges.
The core result is heterogeneity. The average marginal association between out-of-pocket expenditure and the service coverage index was negative in low-income countries, nearly zero in middle-income countries, and small but positive in high-income countries. In other words, in the poorest countries in the sample, a higher reliance on household payments at the point of financing is associated with lower service coverage, while in the wealthiest countries the association flips direction, albeit weakly. The authors describe this pattern as progressive, moving from negative through neutral to positive as national income rises.
Several other covariates also showed associations with the coverage index. Gross domestic product per capita, the size of the elderly population, external health expenditure, and governance as measured by the corruption perception measure were all linked to UHC service coverage in the model. These findings reinforce the idea that service coverage is shaped by a broad set of structural factors, not solely by how health care is paid for, and that any analysis of financing composition must account for the surrounding economic and institutional context.
The authors draw a clear policy implication from the pattern they observe: reducing dependence on out-of-pocket payments appears particularly important for improving service coverage in low-income countries, where the negative association is strongest. At the same time, they caution that the heterogeneous relationship across income groups means that assessments of progress toward universal health coverage should consider both the composition of health financing and the specific country context rather than applying a single global benchmark.
Importantly, the study’s observational design imposes limits on interpretation. Because the data are not experimental and the model does not manipulate financing structures, the estimates represent population-averaged associations rather than causal effects. The authors explicitly state that the analysis does not identify the impacts of specific health financing reforms, such as the introduction of a national insurance scheme or the abolition of user fees. Readers should therefore understand the results as describing how out-of-pocket financing and service coverage move together across countries and years, after adjustment for observable confounders, rather than as proof that changing one will mechanically change the other.
Nevertheless, the study offers a useful quantitative anchor for a debate that has often been conducted in qualitative terms. By using nine years of data from 147 countries spanning low-, middle- and high-income settings, and by applying a model appropriate to a bounded proportional outcome, the analysis provides evidence that the financing composition of a health system is systematically related to how well that system covers its population with essential services, and that this relationship weakens and even reverses as countries grow wealthier. For policymakers in low-income countries working toward the 2030 target, the message is that shifting away from household-financed health spending is associated with better service coverage, a finding that aligns with long-standing calls from the global health community to expand pooled and prepaid financing mechanisms.
Subject of Research: The association between out-of-pocket health expenditure as a share of health financing and the universal health coverage service coverage index across country income groups.
Article Title: Effects of out-of-pocket health expenditure on universal health service coverage: evidence from panel data from low-, middle-, and high-income countries
Article References: Kabir, M. A., Ahmed, S., Löve, J., Huque, R., & Khan, J. (2026). Effects of out-of-pocket health expenditure on universal health service coverage: evidence from panel data from low-, middle-, and high-income countries. BMC Health Services Research. https://doi.org/10.1186/s12913-026-16014-8
Image Credits: AI Generated
DOI: 10.1186/s12913-026-16014-8
Keywords: universal health coverage, out-of-pocket expenditure, health financing, low-income countries, panel data, fractional logit, GEE model, health services research, SDG target, corruption perception, Effects, out-of-pocket
News Source: Ophelia Keating. (November 3, 2026). Out-of-pocket health spending linked to weaker universal health coverage in poorer countries. Scienmag.
