Flores G O'Donnell O 2016 We propose a measure of household exposure to particularly onerous medical expenses. The measure can be decomposed into the probability that medical expenditure exceeds a threshold, the loss due to predictably low consumption of other goods if it does and the further loss arising from the volatility of medical expenses above the threshold. Depending on the choice of threshold, the measure is consistent with a model of reference-dependent utility with loss aversion. Unlike the risk premium, the measure is only sensitive to particularly high expenses, and can identify households that expect to incur such expenses and would benefit from subsidised, but not actuarially fair, insurance. An empirical illustration using data from seven Asian countries demonstrates the importance of taking account of informal insurance and reveals clear differences in catastrophic medical expenditure risk across and within countries. In general, risk is higher among poorer, rural and chronically ill populations. application/pdf https://sonar.ch/global/documents/265290 eng info:eu-repo/semantics/altIdentifier/doi/10.1016/j.jhealeco.2016.01.004 info:eu-repo/semantics/altIdentifier/pmid/26812650 info:eu-repo/semantics/openAccess Journal of health economics. - 2016 Asia Catastrophic payments Medical expenditures Reference-dependent utility Risk Asia Catastrophic Illness Cross-Sectional Studies Financing, Personal Health Expenditures Health Surveys Humans Insurance Coverage Insurance, Health Models, Statistical Risk Assessment Catastrophic medical expenditure risk. http://purl.org/coar/resource_type/c_6501