World Bank’s Thematic Group on Health, Nutrition and Population and Poverty REACHING THE POOR CONFERENCE, February, 2004 ASSESSING CHANGES IN TARGETING IN HEALTH AND NUTRITION POLICIES: THE CASE OF ARGENTINA (Part A) Leonardo Gasparini Mónica Panadeiros Fundación de Investigaciones Económicas Latinoamericanas Buenos Aires, Argentina

I. Introduction Argentina suffered a deep recession from 1998 to 2002: GDP fell 18.4% between those years. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Real GDP, 1990=100 Source: authors´ calculations based on Ministerio de Economía.

In concordance, inequality and poverty have substantially increased. The poverty headcount ratio was 20.1% in 1998; four years later that rate had increased to 54.3%. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Gini coefficient Household per capita income Greater Buenos Aires, Poverty headcount ratio Greater Buenos Aires, Source: CEDLAS (2003)

In this scenario, it is very relevant to target the (scarce) public resources to the needy. This study contributes to the understanding of the distributional incidence of social policies in Argentina. In particular, we focus the analysis on health and nutrition policies directed to pregnant women and children under 4. This presentation deals with maternal and child health services. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A

II. Maternal and child health programs The health system is organized around a strong participation of the public sector: besides regulating health services, it owns and operates an extensive network of public hospitals and primary health care centers. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Health care beds (1995)

The public health system is universal: no requirements are needed to use most of the services in public health facilities. In these health facilities, people have access to all sorts of services free of charge, but to outpatient drugs. The access to the system is also free in enrollment: any citizen is allowed to attend the primary health center and/or hospital freely chosen each time. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A

In this study, we concentrate the analysis on the following health services to pregnant women and children under 4: -Antenatal care -Attended delivery -Visits to a physician -Medicines -Hospitalizations REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A

III. Methodology One of the main questions the study is intended to contribute to the answer is: “Who are the beneficiaries of public health programs directed to pregnant women and children?” To tackle this question, we perform a traditional benefit- incidence analysis of public spending on these programs. A benefit-incidence analysis allows an assessment of the degree of targeting of average public spending. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A

An usual assumption is that users of the subsidized service and their families are the beneficiaries of the public program. Benefits from a specific program are assigned to individuals according to their answers to a household survey on the use of that program. Information from two Living Standard Surveys with questions on the use of various health services (1997 and 2001) is used in this study. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A

A crucial stage in a benefit-incidence analysis is sorting households by a welfare indicator. We mostly use household income adjusted for demographics, or equivalized household income, as the individual welfare indicator. Total population and children are grouped in quintiles of the distribution of equivalized households income. By construction, quintiles have 20% of total population. Instead, since the number of children per household is decreasing in income, the share of children is not uniform along income distribution. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Population and children by quintiles Distribution of equivalized household income Source: authors´ calculations based on the EDS and ECV.

To find the beneficiaries of each public program, we proceed in three stages by identifying (i) the potential users of the service (for example: mothers with children under 2 in the case of antenatal care), (ii) the effective use of the service, and (iii) the public/private choice. The fact that the number of children per household (potential users) is decreasing in income, will have a fundamental consequence on the distributional incidence of public programs directed to children. Even a universal program to all children will be pro-poor, given the negative correlation between the number of children and household income. This relationship became less strong between 1997 and 2001, implying a potential reduction in the targeting of social policies. REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A IV. Findings Antenatal care Antenatal care is widespread in Argentina, even for poor mothers. Subsidies are highly pro-poor. This pro-poor pattern is basically the consequence of a greater concentration of children under 2 in the bottom tail of the distribution, and a choice of public facilities significantly decreasing in income. The degree of targeting decreased between 1997 and This change seems to be mostly the consequence of a reduction in the share of children under 2 in the bottom quintile, and the increase in the use of public facilities in mid and high-income households.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Antenatal care By quintiles of the equivalent household income distribution Source: authors´ calculations based on the EDS and ECV.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Attended delivery Most deliveries in urban Argentina are assisted by a medically trained person. Deliveries in public hospitals are much more often for poor than for rich mothers. Given that fertility is higher in poor households and the use of public hospitals is more widespread, the subsidy to attended deliveries in public hospitals is clearly pro-poor. This service seems to have become less targeted over time.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Attended delivery By quintiles of the equivalent household income distribution Source: authors´ calculations based on the EDS and ECV.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Visits to a doctor There are differences in the 1997 and 2001 questionnaires. The 1997 survey reports consultations with a physician only for those children reported sick. The 2001 survey instead asks directly for consultations with a physician. Because of that, there are large differences in the share of children seen by a doctor in 1997 and If in 2001 we restrict the analysis to those reported sick, the shares are similar. The share of children under 4 who visited a doctor in the month previous to the survey is more sensitive to household income in the 2001 survey than in the 1997 survey. This is a sign that taking a child to the doctor when not considering her sick is a more frequent behavior in wealthier households than in poorer ones.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Results for both 1997 and 2001 clearly indicate a pro-poor profile of public subsidies. Around 70% of the beneficiaries of these subsidies are individuals in the two poorest quintiles of the population. The main reasons of this pro-poor pattern is the greater concentration of children under 4 in the bottom tail of the distribution, and a choice of public facilities decreasing in income. The degree of targeting decreased between 1997 and 2001.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Visits to doctor By quintiles of the equivalent household income distribution Source: authors´ calculations based on the EDS and ECV. Note: (1) calculated as the product of the two previous rows, (2) actual answers. (3) Incidence is estimated as in (1).

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part AHospitalizations Subsidies to this service are highly pro-poor, but the degree of targeting has decreased over time. During there has been a slow increase in the use of public facilities. That increase was rather widespread along the income distribution.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Hospitalizations By quintiles of the equivalent household income distribution Source: authors´ calculations based on the EDS and ECV.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part AMedicines Only some medicines are given for free or at subsidized prices at public health facilities. The results unambiguously suggests a pro-poor profile of public subsidies to medicines for children in public facilities. Around 50% of these drugs go to children from households in the bottom quintile of the income distribution. Again, there is a clear reduction in the degree of targeting of this public program between 1997 and 2001.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Medicines By quintiles of the equivalent household income distribution Source: authors´ calculations based on the EDS and ECV.

REACHING THE POOR CONFERENCE (February 18-20, 2004) Gasparini-Panadeiros, Part A Summarizing incidence results All health programs considered are pro-poor. Incidence results do not significantly differ among these programs. The pro-poor pattern is basically the consequence of i) a greater number of children per household of low-income families relative to the rest; ii) a choice of public facilities significantly decreasing in income. The degree of targeting seems to have decreased for all health services considered since Demographic changes (fall in the relative fertility rates of poor people) would explain a sizeable part of the decrease in the degree of targeting. The other explanatory factor would be an increase in the use of public facilities by better-off households, likely triggered by the economic crises that Argentina has suffered since 1998.