This paper estimates the incidence and intensity of catastrophic health payments and
their impoverishment effects and identifies the sources of catastrophic payments by using
the nationally representative household survey, the Cambodia Socio-Economic Survey
conducted in 2004, 2007, 2009, 2010 and 2011 by the National Institute of Statistics. We
find that the proportion of households with out-of-pocket health spending exceeding the 10
percent threshold (the incidence of catastrophic payments) declined from 12.3 percent in
2004 to 9.2 percent in 2011, and the amount of out-of-pocket health spending as a share of
total household expenditure exceeding the 10 percent threshold (the intensity of catastrophic
payments) also dropped, from 2.0 percent in 2004 to 1.3 percent in 2011. Better-off
households are more likely to exceed the payment threshold than poor households. The level
of consumption per capita, household size, distance between household and commune health
centre, and households in rural areas are positively associated with catastrophic payments,
while education and access to safe drinking water and sanitary toilets have played a very
important role in reducing the likelihood of incurring catastrophic payments. Out-of-pocket
health spending seems to increase poverty incidence and the poverty gap. Its effects on
poverty incidence are diminished over time, but poor households become even poorer. The
evidence indicates that health-related programmes to reduce catastrophic health spending
should be well targeted and public health interventions in the water and sanitation sector
that promote access to safe drinking water and hygienic toilets can be an indirect approach
to address the problem.