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Health Policy and Planning Advance Access published online on March 13, 2006
Health Policy and Planning, doi:10.1093/heapol/czl004
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© The Author 2006, Published by Oxford University Press in association with the London School of Hygiene and Tropical Medicine. All rights reserved.

Original Papers

Financing mental health services in low- and middle-income countries

Anna Dixon 1 *, David Mcdaid 2, Martin Knapp 3, and Claire Curran 4

1 Department of Social Policy, all London School of Economics and Political Science, UK
2 Personal Social Services Research Unit, LSE Health and Social Care, all London School of Economics and Political Science, UK; European Observatory on Health Systems and Policies, all London School of Economics and Political Science, UK
3 Personal Social Services Research Unit, LSE Health and Social Care, all London School of Economics and Political Science, UK; Centre for the Economics of Mental Health, Institute of Psychiatry, King's College London, UK
4 European Observatory on Health Systems and Policies, all London School of Economics and Political Science, UK

* To whom correspondence should be addressed.
Anna Dixon, E-mail: a.dixon{at}lse.ac.uk


  Abstract

Mental disorders account for a significant and growing proportion of the global burden of disease and yet remain a low priority for public financing in health systems globally. In many low-income countries, formal mental health services are paid for directly by patients out-of-pocket and in middle-income countries undergoing transition there has been a decline in coverage. The paper explores the impact of health care financing arrangements on the efficient and equitable utilization of mental health services. Through a review of the literature and a number of country case studies, the paper examines the impact of financing mental health services from out-of-pocket payments, private health insurance, social health insurance and taxation. The implications for the development of financing systems in low- and middle-income countries are discussed.

International evidence suggests that charging patients for mental health services results in levels of use which are below socially efficient levels as the benefits of the services are distributed according to ability to pay, resulting in inequitable access to care. Private health insurance poses three main problems for mental health service users: exclusion of mental health benefits, limited access to those without employment and refusal to insure pre-existing conditions. Social health insurance may offer protection to those with mental health problems. However, in many low- and middle-income countries, eligibility is based on contributions and limited to those in formal employment (therefore excluding many with mental health problems). Tax-funded systems provide universal coverage in theory. However, the quality and distribution of publicly financed health care services makes access difficult in practice, particularly for rural poor communities.

Keywords: mental health services; financing; organized; developing countries; developed countries; fees.
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