understanding the scope and nature of informal payments in the health sector. Qualitative surveys complement, and provide a deeper perspective on the phenomena.

# **How widespread are informal payments?**

A major challenge is differentiating among formal, informal, and gratitude payments in the presence of official co-payments and voluntary gift-giving by grateful patients. Where all fees have been banned any payment by households is clearly unofficial but in many countries formal fees do exist and blur the dichotomy. It then becomes the amount of payment, the nature of the transaction, and its timing that determine whether the payment is informal or not (Lewis 2006). For example, in the Kyrgyz Republic in 2001, 95 percent of those who paid for services did not receive a receipt while only 3 percent reported giving a gift to the health personnel at the time of service (Falkingham 2002).

Figure 6 shows the percentage of survey respondents who recently used public health facilities and reported making informal payments. The data are for 12 countries for which recent World Bank data are available. More than 35 percent of respondents in Sierra Leone and 30 percent in Ghana reported making informal payments. In Russia and Paraguay by contrast, “only” five percent did. A breakdown of informal payments for hospital and general health services show that without exception, a larger share of households reported making informal payments for hospitalizations. Evidence from four Eastern European countries, the Czech Republic, Hungary, Poland, and Romania, further corroborates this, finding that informal payments are typically associated with surgery and inpatient services (CEEHN 2002).

Table 14 presents additional country data on informal payments, which provide a sense not only of their frequency but also of their size in these countries. The share of households that report having made informal payment for health services is highly variable across countries, ranging from 3 percent in Peru to 22 percent in Guinea. In all countries informal payments make up a large share of half-monthly per capita income, from 15 percent in Paraguay to 113 percent in Madagascar. These data clearly show how informal payments in health care can constitute a major burden on household resources.

The magnitude of informal payments can also vary substantially within countries. Household survey data from Kyrgyzstan in 2007 show that informal payments for hospitalization ranged from roughly 60 percent of half-monthly income in Issyk-Kul to around 125 percent in Naryn (Falkingham, Akkazieva, and Baschieri, forthcoming).<sup>21</sup> Perception surveys of providers offer additional insights, and support the reports from patients. In Costa Rica, 85 percent of medical staff indicated that under-the-table payments to physicians were common (Di Tella and Savedoff 2001). A study of 30 municipal hospitals in Bolivia in 1998 asked physicians and nurses how common they considered bribes for hospital services (Gray-Molina et al. 2001). More than 25 percent of physicians and 23 percent of nurses answered that bribes were required “a lot” or “always. When asked about corrupt practices in their own workplace, 65 percent of

> 21 National average income was used for the computations since regional average incomes were not available.

51