Household out-of-pocket expenditures on health care in Bangladesh according to principal component analysis (PCA).

In Bangladesh, illness results in large out-of-pocket health care expenditures for households. Identifying the components associated with health care expenditures should prove meaningful for future policy formulation in Bangladesh. Thus, the objective of the study was to investigate the overall influence of individual health care costs over data space in a probalistic way using Principal Component Analysis for expenditures incurred due to a recent illness. The study is based on secondary data of the Household Income and Expenditure Survey conducted in 2005 by the Bangladesh Bureau of Statistics. This survey is a nationally representative survey in Bangladesh and its sample includes 8,126 individuals who have incurred health care expenditures in the 30 days prior to the survey. Principal Component Analysis was used to analyze the influence of the factors of health care expenditures in Bangladesh. According to results, 58% of the information on the overall data space confirmed that the cost of medicine is greater than any other factor for health care expenditures. Drug-related health expenditures represented a large component and suggest the need for policies promoting the rational use of drugs. If such strategies are considered and implemented in operational stages, the quality of health care should improve and drug expenditures should substantially decrease.