Introduction: The Government of Egypt has embarked on a process of reforming health care financing in the country. Under the influence of external advisers it has so far focused on social health insurance as the main funding mechanism. Other options, in particular tax-based financing, have hardly been considered.
Methods: Review of current health care financing arrangements in Egypt, of potential areas for improvement, and of stated health policy goals. Analysis of social health insurance and taxation-based financing on their ability to meet the stated policy goals and their viability.
Results: Although both funding mechanisms have distinct advantages and disadvantages when applied to the Egyptian health system, tax-based financing seems better able to meet the official policy goals of the Government of Egypt than social health insurance on grounds of efficiency, equity and technical feasibility.
Conclusions: The Government of Egypt will have to raise public health expenditure substantially to finance care at an adequate level. Expanding and refining the present tax-based financing scheme, rather than switching to an insurance-based scheme seems the technically superior strategy. Other measures to improve the coordination of financing, such as the creation of a single fundholding agency, are needed as well as tighter regulation of private providers and the pharmaceutical market.