Financial protection and coping strategies in rural Uganda: an impact evaluation of community-based zero-interest healthcare loans.

In low- and middle-income countries, catastrophic health expenditures and economic hardship constitute a common risk for households' welfare. Community health financing (CHF) represents a viable option to improve financial protection, but robust impact evaluations are needed to advance the debate concerning universal health coverage in informal settings. This study aims at assessing the impact of a CHF pilot programme and, specifically, of the initial phase involving zero-interest loans on health expenditures and coping strategies in a rural district of Uganda. The analysis relies on a panel household survey performed before and after the intervention and complemented by qualitative data obtained from structured focus group discussions. Exploiting an instrumental variable approach, we measured the causal effect of the intervention, and the main findings were then integrated with qualitative evidence on the heterogeneity of the programme's impact across different household categories. We found that the intervention of zero-interest healthcare loans is effective in improving financial protection and longer-term welfare. Community perceptions suggested that the population excluded from the scheme is disadvantaged when facing unpredictable health costs. Among the enrolled members, the poorest seem to receive a greater benefit from the intervention. Overall, our study provides support for the positive role of community-based mechanisms to progress towards universal coverage and offers policy-relevant insights to timely design comprehensive health financing reforms.