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The impact of user fees on health service utilization in low- and middle-income countries: how strong is the evidence?

Mylene Lagarde ^a, Natasha Palmer ^a

Introduction

Access to basic health services of acceptable quality is still denied to many of the world’s poorest people.¹ Against a backdrop of severely underfunded health systems,^1,2 governments are faced with a dilemma. Payments for health services, in the form of user charges, are likely to present a barrier to access. Yet, a shortage of resources at the facility level is a contributor to failure to deliver quality services, and this also presents a barrier to access. Some have argued that user charges can generate vital resources at the local level and help provide good quality services;^3–5 others have highlighted their negative effects, particularly on equity;^6–9 Recently, several international campaigns have advocated the removal of user fees, especially for primary care services.^1,10

Some recent articles have underlined the paucity of evidence on the effectiveness of policy interventions in low-income countries;^11,12 others have noted the importance of systematic reviews for understanding health systems.¹³ Despite the central importance of the user-fee debate, no systematic review has examined the quality of the empirical evidence on this topic. To redress this imbalance, this review set out to assess the quality of the existing evidence on the impact of user fees on health service utilization, household expenditures and health outcomes in low- and middle-income countries.

Methods

Scope of the review

User fees refer to a financing mechanism that has two main characteristics: payment is made at the point of service use and there is no risk sharing. User fees can entail any combination of drug costs, supply and medical material costs, entrance fees or consultation fees. They are typically paid for each visit to a health service provider, although in some cases follow-up visits for the same episode of illness can be covered by the initial payment. This review aimed to assess the effect on health service utilization of introducing, removing, increasing or decreasing user fees in low- and middle-income countries.

Search strategy and inclusion criteria

We searched 25 databases covering the social science, economics and health literature. We also searched the reference lists of all relevant articles, the web sites of related research centres or institutions (lists of sources searched are available from the authors upon request) and existing reviews.^14–19 The search strategy combined looking for terms in subject headings and within the text pertaining to health financing (“health financing”, “user charges”, “user fees”, “cost recovery”, “direct payment”, “drug revolving fund”, “fee”) and outcomes (“utilization”, “access to services”, “health expenditures”, etc.). No limitation on date or publication language was applied. Only studies from low- and middle-income countries, as defined by the World Bank, were included.

Only experimental or quasi-experimental study designs were included – cluster randomized controlled trials (C-RCTs), controlled “before and after” (CBA) studies and interrupted time series (ITS) studies (Table 1) – as suggested by the Effective Practice and Organisation of Care (EPOC) group of the Cochrane Collaboration, where this review was registered. Indeed, such designs are known to provide the most reliable measures of effect. Papers were assessed only if the effect of the intervention was measured in terms of either changes in utilization, household expenditure, health outcome or equity. Both authors independently sifted the titles and abstracts of publications for retrieval. In case of disagreement, full-text articles were retrieved and examined. All retrieved articles were then independently reviewed by the two authors, and agreement was reached over whether they fulfilled the criteria for inclusion in the review.

• Table 1. Inclusion criteria applied in review of studies of the effects of user fees on health service utilization in low- and middle-income countries
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Reanalysis of data

We found several studies that had longitudinal data on utilization but had not performed a time series analysis.^20–26 To be able to include these, we relaxed the original definition of ITS²⁷ (Table 1) and set out to reanalyse the data appropriately. When they were not directly reported in the paper, original data series were requested from the authors. Whenever the authors could not be found or did not respond, we attempted to reconstruct data series by scanning graphs.¹

Data series were then examined with the following segmented regression model to control for secular trends and potential serial correlation of data, and to detect any significant changes after the introduction of the new policy:

Y_t = β₀ + β₁ × Preslope + β₂ × Intervention + β₃ × Postslope + ε_t

where Y_t is the outcome variable at time t. Intervention is coded 0 for pre-intervention time points and 1 for post-intervention time points; its coefficient β₂ reflects the immediate impact of the intervention on the dependent variable. Preslope is a continuous variable indicating time from the start of the study up to the intervention (if the intervention occurred at the nth period, preslope is coded sequentially from 1 to n before the intervention and remains equal to n for the rest of the series). It thereby captures the structural trend that has started before the intervention. Postslope is coded 0 up to the last point before the intervention phase and coded sequentially from 1 thereafter. Its coefficient β₃ therefore reflects the trend or growth rate in outcome after the intervention. When auto-correlation was detected by the Durbin-Watson test, it was corrected with a PraisWinsten regression.

In addition, to provide more comparable results, we computed price elasticities (e_p) for studies reporting changes in user fees, and “net” elasticities for those with a control site. We also computed the statistical significance of the observed effects if it was not reported in the original paper.

Data extraction and quality assessment

Quality criteria were adapted from those suggested by the EPOC group of the Cochrane Collaboration (Table 2). When a study presented unsatisfactory or unclear elements for two or more criteria, it was scored as being of “low” quality. When only one criterion was unclear or unmet, it was scored as being of “moderate” quality, and when all elements were satisfied, the study was considered as being of “high” quality. For each included study, both authors extracted data and assessed quality. They then reviewed one another’s conclusions. Discrepancies were resolved by discussion.

• Table 2. Quality assessment criteria applied to studies included in review of the effects of user fees on health service utilization in low- and middle-income countries
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Description of studies

The initial database search generated over 24 000 references. An initial sift of titles and abstracts led to the inclusion of 243 documents for further investigation (Fig. 1 provides more details on the search strategy). Sixteen studies met our inclusion criteria. We only found studies reporting effects on health service utilization. None reported an effect on expenditures or health outcomes, and two reported effects on utilization by different socioeconomic groups.

Fig. 1. Synthesis of study identification^a in review of the effects of user fees on health service utilization in low- and middle-income countries

Eight papers presented data on the effects of introducing user fees (Table 3), five on the effects of removing fees (Table 4) and five on the effects of decreasing or increasing fees (Table 5 and Table 6). Some papers reported results from specifically designed studies,^4,28–32 while others sought to analyse the effect of nationally- implemented strategies using routine data.^{20–26,33–35}

Study settings varied considerably (type of service, type of facility, type of payment). A range of utilization measures were reported as outcomes, including new visits, registrations, weekly/quarterly/monthly attendance, outpatient and/or inpatient attendance. As a result, a narrative approach to reporting the results has been adopted.

• Table 3. Main characteristics of studies on the introduction of user fees and its effects on health service utilization in low- and middle-income countries, according to literature review
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• Table 4. Main characteristics of studies on abolishing user fees and its effects on health service utilization in low- and middle-income countries, according to literature review
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• Table 5. Main characteristics of studies on reducing user fees and its effects on health service utilization in low- and middle-income countries, according to literature review
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• Table 6. Main characteristics of studies on increasing user fees and its effects on health service utilization in low- and middle-income countries, according to literature review
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Findings

Impact of removing user fees

Five studies used longitudinal data to report the effects of abolishing user fees on utilization. These were all reanalysed.^{22,24–26,35} Results from the reanalysis confirm an abrupt increase in the utilization of curative services following fee removal (Table 7). This abrupt increase was rarely followed by a sustained increase in utilization growth. In most instances, no significant change was recorded in attendance for preventive services,^22,24,35 which were usually already free. However, several data series showed that after fees were removed, the growth in preventive service utilization significantly increased (or, in South Africa, declined at a more modest rate), which could be interpreted as a long-term trickle-down effect of fee removal (Table 7). However, the quality of the data from which these conclusions were drawn was judged to be low due to the presence of confounding factors (concurrent policy changes), the questionable quality of routine data or small sample sizes.

• Table 7. Effects of abolishing user fees^a on health service utilization in low- and middle-income countries, according to literature review
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Impact of introducing user fees

Eight studies examined the effect of introducing user fees: two CBA studies,^4,29 one C-RCT³² and five ITS studies.^20–24 ITS studies suggested that policies that introduced user fees decreased health service uptake (Table 8). Indeed, the reanalysis showed a sharp single step down in utilization levels for curative services in Kenya.^21,22,24 A similar, though less significant change was observed in Burkina Faso.²⁰ Data from Papua New Guinea²³ showed a decrease in utilization of preventive services, more striking when compared to the concomitant utilization increase in free facilities. Although growth in service uptake was often greater after the policy change, suggesting potential positive outcomes in the long run, this was not a statistically significant result. Again, the quality of the data and analysis from which these conclusions were drawn was judged to be low. In particular, in all cases changes in fees occurred at the same time as economic crises and/or other changes in the health system, reducing the extent to which one could attribute changes to fees alone.

The two CBA studies^4,29 examined the effects of introducing user fees alongside quality improvements, and both found that this increased utilization for the poorest groups. However, both studies also had significant weaknesses in terms of design and analysis. In a C-RCT of good quality, Kremer and Miguel³² showed that uptake of worm-prevention treatment in Kenyan schools fell from 75% to 19% after fees were introduced. In a regression analysis, the authors found that the introduction of cost-sharing was responsible for the major part of this reduction in uptake.

• Table 8. Effects of introducing (or increasing) user fees^a on health service utilization in low- and middle-income countries, according to literature review
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Impact of decreasing user fees

Evidence from two studies^28,31 on the effect of decreasing fees suggested an increase in utilization (Table 9). Abdu et al.³¹ found that decreasing user fees by 25% and 75% led to a more than proportionate change in the number of pregnant women and children seen in health centres in the Sudan. This study again has several methodological limitations.³¹ Ojeda et al.²⁸ reported that decreasing the price of intrauterine devices in Colombia led to an increase in the number of users and indicated a highly sensitive price elasticity of demand. However, high inflation at the time in Colombia may have caused people to overestimate the real fall in price.

• Table 9. Effects of reducing user fees on health service utilization in low- and middle-income countries, according to literature review
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Impact of increasing user fees

We included three studies reporting the effects of increasing user fees. One³³ studied an increase of user fees in the public sector (Table 8) and two^30,34 studied their effect in private facilities (Table 10). Data from Lesotho³³ showed that increasing user fees led to a drop in utilization in the public sector, while uptake of services in private not-for-profit facilities did not change. In Gabon,³⁴ data from two increases in fees in a private hospital showed that demand became increasingly sensitive to price, which suggests a threshold effect. An experiment in Ecuador³⁰ found that demand for reproductive health services (obstetric-gynaecological, antenatal care) in private clinics was inelastic to changes in prices. However, this study was again subject to limitations due to confounding factors (high inflation may have confused real price variations) and a failure to follow the initial experimental design.

• Table 10. Effects of increasing user fees on health service utilization in low- and middle-income countries, according to literature review
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Discussion

This review is the first attempt to systematically assess the quality of existing evidence on the subject of charging for health services in low-income countries. It differs from previous reviews^15–17 in using a formal protocol and systematically appraising the evidence.

Main findings

There is some limited evidence from the papers reviewed to suggest that removing user fees increases the utilization of curative health-care services, usually in the form of one sharp step-up following fee removal. This policy change may also have a positive impact on the uptake of preventive services in the long run.

As for the introduction of user fees, there is limited evidence that it decreases utilization, again in the form of one sharp reduction. It is unclear from any study if this effect extends beyond this initial drop. Two studies suggested that the combination of user fees and improvements in quality can increase utilization.

These findings broadly support the view that user fees present a barrier to access to curative health services for those groups that would be eligible to pay for them. They concur with those of some of the non-systematic reviews on user fees that have been completed.^15–17 However, we feel that there are several important questions in this area that remain unanswered, and it is important to note that all but one of the studies had significant weaknesses.

Weaknesses of the available evidence

It must be stressed that the quality of the available evidence was low. One study³² was found to be of good quality, while all others were potentially biased. Even studies that have been highly influential and often quoted^4,29 failed our quality appraisal. A particular weakness was that only two studies looked at differential impact across population groups.^4,29 Most studies on routine data could not assess the equity impact of the reforms described.

Most studies providing longitudinal data (and reanalysed as ITS) were unable to isolate changes in charges for health services from other concurrent changes occurring in, or outside of, the health system. A similar problem in two experimental studies was that high inflation may have confused the effects of price variations.^28,30 A key problem for the CBA studies was non-equivalence between control and intervention sites (Table 3 and Table 4). In one study there may also have been problems controlling whether free care was really free in control areas.³⁶

These quality shortcomings, in combination with such a limited number of studies on each topic, mean that many questions remain. Key questions include the effects of fee changes on the quality of care, drug use and health worker motivation as well as utilization. The question of which patients increase or decrease their utilization of health services, and for what health conditions, is also almost totally unanswered. The longer term impacts of fee introduction or removal have also not been adequately measured. There are many difficulties associated with answering such questions in the “noisy” setting of health systems. However, there remains considerable scope for improvement in the quality of research and analysis around this area.

Strengths and weaknesses of the review

This review is the first of its type to address such an important policy question for health financing. The scope of the review was wide. Some papers dealt with the change in price of a specific good, while others dealt with charges for basic health services more generally. Studies also covered both public- and private-sector charges. Some are the result of specially-designed experiments; others are attempts to study the effects of a “real world” policy change. The result is that our findings are heterogeneous and hard to summarize quantitatively. There may be value in narrowing down the scope of such reviews in the future, although this must be balanced against the paucity of papers on any given subject.

Criteria such as those suggested by the EPOC group are immensely valuable in lending rigour to the review process but should perhaps be modified to reflect the difficulties of isolating cause and effect in some of the settings we have described, where policy changes usually parallel other events and are dependent on broader contextual factors.³⁷ This raises the question of whether the standards that we applied are reasonable in the setting of health-systems research, where understanding the reasons for success or failure of social interventions is as critical and informative as measuring their effects. Observational or qualitative case studies,³⁸ studies of policy implementation³⁹ and costing studies play an important role in helping understand how policies get implemented. It is also important to stress the value of many studies that were not included in this review because they were not designed to offer a direct measure of effect, such as studies on health-seeking behaviour^7,40,41 or benefit-incidence analyses.⁴² Recently, several developments have emerged that translate the principles of systematic reviews into health-system research, while assessing qualitative and quantitative evidence⁴³ or accounting for the complexity of interventions.⁴⁴ In the user-fee case, such complexity is demonstrated by the desirability of studying utilization, equity, quality and implementation simultaneously to really understand effect.

Conclusion

At present, the magnitude and heat of the debate over user fees are not matched by efforts to strengthen the evidence base on the topic. Despite a sizeable literature published on this issue and some vigorous debate spanning several decades, there is still a scarcity of good quality evidence. Two questions remain. Why is this the case? What can be done?

Good impact evaluations seem difficult to apply to health systems.⁴⁵ This is partly for economic reasons (they are costly and labour intensive) and partly for ethical and political ones (it is difficult to give services to some communities and not to others in order to create control groups). Such research may be overly burdensome and time consuming, while changes in policies are often driven by political agendas and happen quickly. Finally, very little large-scale research funding has been available in the area of health financing or health systems research.

Evidence from carefully designed impact evaluations should be advocated, and the recent effort of the Centre for Global Development to establish an International Initiative for Impact Evaluation is to be welcomed.¹¹ In the meantime, several simple steps can be taken by researchers to improve the quality of research and evidence in this area:

• lobby for policy-makers and donors to design prospective evaluations before rolling out national policy changes, such as introducing or removing user fees;
• try to identify control sites;
• use appropriate statistical and econometric methods to analyse data;
• combine quantitative analysis of effect with qualitative information describing context and implementation issues;
• seek to measure the equity effect of changes in charging policy. ■

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Funding: This work was funded by the Bill & Melinda Gates Foundation.

Competing interests: None declared.

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Affiliations

• London School of Hygiene and Tropical Medicine, Keppel Street, London, WC1E 7HT, England.