The demand for health care among urban slum residents in Dhaka, Bangladesh

There is a dearth of research on health care demand in developing countries, and even less that focuses on the poor, especially the urban poor. This study uses panel data from the Urban Livelihoods Study (ULS) to estimate the probability of seeking care and mean expenditures for illness among slum residents in Dhaka, Bangladesh. Three-part models were used to correct for the sample selection and endogeneity problems that are common to questions of health care demand, and the smearing technique was used to re-transform estimates of expenditure from the log scale. Unconditional estimates of mean expenditure for illness also were calculated.; The study results show that: there is little evidence of gender differentials in seeking care or spending for illness in this population; there is evidence of occupational health hazards for adults; and there is high opportunity cost for working household members to seek care when they are ill. Income inequity was identified at the point of seeking care for this population, but not in terms of the amount spent for an illness. The urban poor are at a disadvantage in accessing care, yet spend the same amount as the non-poor once they seek care; they sustain a substantial financial burden from illness. Unconditional estimates of the average expenditure for an illness episode suggest that pre-paid financing schemes could protect the urban poor from this financial burden by requiring payments that are one-third of what is being paid now.; The study concludes that urban health systems in Bangladesh must work to improve access to care by the poor. Among other things, they should address the curative care needs of adult income-earners as well as those of women and children, and investigate occupation-based health care targeting for urban slum residents. Evidence from this study also indicates that the urban poor view health care as both an investment in future productivity and as a consumption good; as such, urban health policy should view pre-paid financing schemes as a feasible strategy for protecting the urban poor from the financial burden of illness.