The Effect of the Urban Family Physician Program on Out-of-Pocket Health Spending in Iran: Evidence from a Quasi-Experimental Difference-in-Differences Analysis

Articles in Press

Document Type : Research Article

Authors

1 Department of Economic Development and Planning, Faculty of Management and Economics, Tarbiat Modares University,Tehran, Iran

2 Department of Economic Development and Planning, Faculty of Management and Economics

3 School of Public Health and Information Sciences, University of Louisville, Louisville

4 Department of Economic Development and Planning, Faculty of Management and Economics, Tarbiat Modares University, Tehran, Iran.

10.22084/aes.2025.31507.3827

Abstract

Out-of-pocket (OOP) health expenditures represent a considerable share of household spending in Iran and expose families to catastrophic health costs and health-related poverty. To mitigate this persistent challenge, the government launched the Urban Family Physician Program as a pilot in the provinces of Fars and Mazandaran in 2012. The present study evaluates the impact of this policy on the health spending of urban households by drawing on household income and expenditure survey data and employing a quasi-experimental difference-in-differences (DID) framework. Fars province was identified as the intervention site, while several provinces with comparable pre-intervention expenditure patterns were carefully chosen as control groups. To ensure the robustness of the estimates, the control provinces were selected through a multi-stage procedure, and the validity of the parallel trends assumption was confirmed using graphical inspections, placebo regressions, and statistical tests on pre-intervention slopes.



The empirical findings demonstrate that, after implementation, the average OOP health expenditures of households in Fars were approximately 1.7 million IRR lower (in 2014 constant prices) compared with those in the control provinces. This decline is not only economically meaningful but also statistically significant at the 99 percent confidence level. Additional analyses revealed that socioeconomic factors, including the education level of the household head, household income, and demographic composition, exerted significant influence on spending behavior.



In conclusion, the results suggest that the Urban Family Physician Program reduced financial hardship and improved the degree of financial protection for households. However, maintaining these achievements requires stable financial resources and continuous improvements in the quality and accessibility of primary health care services.

Keywords

Main Subjects

Journal of Applied Economics Studies in Iran

Articles in Press, Accepted Manuscript
Available Online from 19 October 2025

Files

Share

How to cite

Statistics