Money Can’t Buy Health (Or Happiness), But It Can Help

The following post is part of a series based on research conducted around the health of urban working poor. 

We all know that money isn’t everything. But when it comes to health care for the working poor, a bit of it can go a long way. Indeed, research shows that affordability is one of the most important determinants of access to healthcare. Affordability effects not only traditional health insurance coverage, but also the opportunity cost of seeking services—like lost time and wages—as well as the small costs that enable access to services, such as transport or co-payments.

Affordability is one of the most important determinants of access to healthcare.

By removing these for potential beneficiaries, improving financial coverage can have a significant effect on their ability to seek services, and, eventually, on their long-term health. That’s why actors around the world are increasingly focused on creating ways to address financial barriers. In resource-constrained settings with a poor, time-constrained population, however, solving financial barriers is no small feat.

Here—as the first installment in a series of blog posts offering innovative solutions to the problems faced by the working poor—are some exciting ideas being implemented around the world.

• Micro-insurance: Micro-insurance—insurance designed to fit the needs of low-income populations—generally has low premiums and is intended to cover individuals against health or other life events that could increase financial vulnerability. When these solutions are linked to a mobile enrollment tool, they have shown to be even more effective in serving the needs of the urban working poor by reducing transaction costs of signing up for insurance.

• Mobile health savings solutions: Mobile health savings solutions are secure and mobile accounts that enable users to manage and deposit their savings for future health expenditures via mobile phone. Some of these programs provide discounts on health services purchased via the account, discounts made possible through relationships with local providers. With mobile penetration rates between 70% and 80% in many sub-Saharan countries, individuals can use phones to manage their health savings with increased transparency

• Health and finance education: Improved health and financial literacy is of paramount importance for the urban poor. Because catastrophic health spending can lead to deeper economic distress, informed health-related planning is particularly important. Financial literacy workshops have been shown to help people improve their savings and budgeting skills, and increase the likelihood of enrollment in financial coverage options, including health insurance.

• Savings and lending groups: Leveraging existing community networks to establish savings and lending groups has proven to be highly successful in places where tightknit networks already exist. While these groups operate differently in different contexts, they serve to help people save and better manage income inconsistency challenges. Beyond financially-based groups, many organizations have also explored innovative ideas on how individuals can come together to share non-monetary assets such as time or skills, which also could potentially help people smooth out inconsistencies in their time or income.

Each of these examples point to—and respond to—the fact that the costs of care go well beyond just paying for a doctor’s visit. The more services that arise to help individuals manage these costs, the better chance we have to make healthcare more accessible for all.