The paper examines the impact of poverty on the health status, entry into the health care market, and the provider choice decision of rural households of Ethiopia. It also investigates the demand diversion and reduction effects of user fees on the chronically poor households. The results show that the poor are more likely to fall ill but less likely to get out side medical help. Poverty not only directly affects the health status of individuals but also increases the duration of illness and hampers the cross effects of education on reducing the incidence of illness and the probability of seeking outside medical help. The results also reveal that compared to other family members immediate family members are more likely to report illness, to get treatment, and to visit modern health care providers. The results of the nested multinomial logit results also show that an increase in user fees is likely to drive out a significant portion of the poorest households and the socially disadvantaged individuals within households from the health care market, which will aggravate the existing inequality in access to basic health care services.
How Poverty Affects the Health Status and the Health Care Demand Behaviour of Households: The Case of Rural Ethiopia presented at Staying Poor: Chronic Poverty and Development Policy, Institute for Development Policy and Management, University of Manchester, 7-9 April 2003. Chronic Poverty Research Centre (CPRC), Manchester, UK, 24 pp.