n South Africa, health care is financed through different mechanisms - allocations from general taxes, private health insurance contributions and direct out-of-pocket payments. These mechanisms impact differently on different households. While there are empirical evidence in developed countries, the distributional impact of such payments and methodological challenges in such assessments in the context of Africa are scarce. Borrowing from the tax literature, the thesis aims to assess the relative impact of health care financing on households' welfare and standards of living. Methodological issues around the assessment of income redistributive impact of health care payments in the context of South Africa are also explored.