There are important two-way causal relationships between poverty and ill-health in Cambodia. The structural weaknesses of the sector (both demand-side and supply-side) mean that the vast majority of total annual health spend is in the form of out-of-pocket expenditure by households.

Health expenditure, particularly on serious (e.g. emergency) treatment at a hospital, accounts for a major proportion of total household spending. A single inpatient hospital visit can account for more than total normal annual non-food household expenditure. As a result, households are either forced to forgo treatment, or to take crisis actions (selling productive assets, taking out loans at high interest rates) in order to afford health care. These crisis actions can force non-poor households into poverty, and the poor into absolute destitution.

In a response to these problems, the World Bank-ADB-DFID Health Sector Support Programme (HSSP) contains as one of its objectives the provision of mechanisms to increase the ability of poor households to obtain access to affordable quality health care.

This report reviews experiences to date with pilot pro-poor health financing schemes in Cambodia, focusing in particular on the use of equity funds to compensate health facilities for the provision of exemptions from user fees to poor patients.