Elsevier

Health Policy

Volume 62, Issue 3, December 2002, Pages 243-273
Health Policy

Understanding informal payments for health care: the example of Bulgaria

https://doi.org/10.1016/S0168-8510(02)00035-0Get rights and content

Abstract

Introduction: Throughout the 1990s, in response to funding deficits, out-of-pocket payment has grown as a share of total expenditure in countries in transition. A clear policy response to informal payments is, however, lacking. The current study explores informal payments in Bulgaria within a conceptual framework developed by triangulating information using a variety of methodologies. Objective: To estimate the scale and determinants of informal payments in the health sector of Bulgaria and to identify who benefits, the characteristics and timing of payments, and the reasons for paying. Design: Data were derived from a national representative survey of 1547 individuals complemented by in-depth interviews and focus groups with over 100 respondents, conducted in Bulgaria in 1997. Informal payments are defined as a monetary or in-kind transaction between a patient and a staff member for services that are officially free of charge in the state sector. Results: Informal payments are relatively common in Bulgaria, especially if in the form of gifts. Informal cash payments are universal for operations and childbirth, clear-cut and life-threatening procedures, in hospitals or elite urban facilities or well-known physicians. Most gifts were given at the end of treatment and most cash payments-before or during treatment. Wealthier, better educated, younger respondents tend to pay more often, as a means of obtaining better-quality treatment in a de facto two-tier system. Since the transition, informal payments had become frequent, explicit, solicited by staff, increasingly in cash, and less affordable. Informal payments stem from the low income of staff, patients seeking better treatment; acute funding shortages; and from tradition. Attitudes to informal payments range from strongly negative (if solicited) to tolerant (if patient-initiated), depending on the circumstances. Conclusions: The study provides important new insights into the incidence and nature of informal payments in the health sector in Bulgaria. Payments were less than expected, very complex, organised in a chaotic, although adaptive, system, and relatively equitable. The timing of payment and the presence of compulsion is a key factor in distinguishing between informal payments given in gratitude or as a bribe, and the latter are seen as problematic, needing to be addressed. Paying informally appeared to be a product of socio-economic reality rather than culture and tradition. The study showed that the principle of comprehensive free coverage existing in Bulgaria until 1989 has been significantly eroded. Initiating a public debate on informal payments is important in a health care reform process that purports to increase accountability.

Introduction

Unlike some of its neighbours, Bulgaria retained a Soviet-model health system during the 1990s, centrally planned and funded from general government revenues. By the middle of the decade it became apparent that the existing funding mechanism was inadequate [1]. Despite a series of one-off financial allocations from central government, supplemented by foreign aid, the system increasingly depended on institutionalised extra-budgetary sources, especially out-of-pocket payments including semi-official fees and ‘under the counter’ payments.

Official attitudes to informal payments have long been ambiguous. A ban that lasted until 1989 was not strictly enforced. Subsequent governments steadfastly avoided taking a view, so that a variety of payments proliferated, acquiring semi-legal status (‘donations’). This was partially formalised by the Decree for the Conditions and Procedure for Payment for Health Care of Patient's Choice in December 1997, defining services for which a fee would be payable. The provisions were, however, vague, with local discretion, and they were considered only a short term solution. In practice, gifts were permitted if they did not lead to abuse.

Better understanding of informal payments is important for several reasons [2], [3]. Firstly, they may be a large component of private health expenditure, rarely included in national health statistics [4]. Better measurement will clarify the extent of private expenditure and the true need for health care funding. Secondly, knowledge of who pays and when will provide information on economic barriers to care. Thirdly, informal payments create perverse incentives, potentially reducing motivation for reform. Finally, informal payments contribute to the informal economy, with implications for the government's ability to raise finances [5].

In a 1994 study, we found widespread informal payments in Bulgaria [6] but that study was limited to recent users of health services, with little information on social and economic circumstances of respondents. This study extends and updates the earlier one, overcoming many of its limitations, by undertaking a large population survey and in-depth qualitative research [7]. We place the findings in the context of other research to develop a conceptual framework for informal payments. We conclude by exploring policy implications.

Section snippets

Methods and definition

The research was conducted in 1997. Data are from two sources. The first is a representative national survey of 1547 individuals aged over 18. In the first of two stages, 200 electoral sectors were selected randomly from the electoral register with probability of selection proportional to size. In each sector, 11 respondents were randomly selected, with eight selected at random for interview (planned sample=1600). Where intended interviewees were unavailable, substitution took place from the

The scale of informal payments in Bulgaria

In the population survey, respondents were asked whether they have ever paid, or given a gift, for a range of services at a state health facility (Table 1). Informal payments appeared relatively familiar, 19% of men and 22% of women having paid or given a gift for at least one service at a state health facility. Gifts were more common than cash payments, 15% of men and 19% of women reporting ever giving a gift compared with 8% of men and of women who reported ever paying cash.

Given the

Discussion

This topic has been the subject of relatively little research in Bulgaria, limiting the scope to validate the results. However, the results do suggest that the frequency of informal payments is somewhat lower than expected from that suggested by previous work [6], [16]. This is, however, a notoriously difficult area to research. It is possible that responses were influenced by perceptions of the semi-illicit nature of the informal transactions. Some underreporting may have occurred due to

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