ANALYSIS OF THE RELATIONSHIP BETWEEN HOUSEHOLD OUT-OF-POCKET HEALTH EXPENDITURE AND HEALTH OUTCOMES IN NIGERIA

Abstract

This study investigated the impact of household out-of-pocket expenditure (OOPE) on health outcomes in Nigeria using time series data from 1990 to 2023 sourced from the World Bank. Health outcomes were measured by maternal mortality rate (MMR), infant mortality rate (IMR), and life expectancy (LEX). Using the Autoregressive Distributed Lag (ARDL) Technique, the results showed that higher OOPE significantly increases MMR in both the short and long run, reduces IMR only in the short run, and lowers LEX in the long run. These findings indicated that reliance on OOPE undermines maternal and long-term population health while providing only temporary benefits for infant survival. Guided by Grossman’s health demand theory, the study concluded that Nigeria’s OOPE-dominated health financing is inequitable and unsustainable. It recommended expanding the National Health Insurance Authority (NHIA) to cover the informal sector, increasing public health spending to meet the Abuja Declaration target, prioritizing primary healthcare and skilled birth services, investing in education, water, and sanitation, adopting progressive health financing, expanding rural health infrastructure, and establishing emergency health funds to protect households from catastrophic costs.