The Counterintuitive Association Between Health Literacy and Out- of-Pocket Health Expenditure: Exploring Heterogeneity by Chronic Disease in China

Background Health literacy has been increasingly emphasized as a critical factor shaping healthcare behaviors and costs. However, existing studies provide mixed evidence regarding its association with out-of-pocket (OOP) health expenditure, and limited research has addressed how this relationship may vary with chronic disease burden. This study aimed to identify health literacy profiles in a large Chinese population and to assess their association with OOP expenditure, while exploring potential variation by chronic disease status. Methods We utilized data from a large-scale health literacy survey of 56,863 residents aged 15–69 in Zhejiang, China. Latent profile analysis (LPA) identified health literacy subgroups using the validated Chinese Health Literacy Scale. Multivariable linear regression assessed associations between health literacy profiles and OOP health expenditure, adjusting for sociodemographic, socioeconomic, and health-related covariates. Formal interaction testing and stratified subgroup analyses were conducted to explore potential effect modification. Results LPA identified three health literacy profiles: low (14. 7%), moderate (31. 4%), and relatively high (53. 9%). The primary finding was a counterintuitive positive association in the fully adjusted model, where a relatively high health literacy profile was linked to significantly increased OOP expenditure. While the formal test for an interaction by chronic disease status was not statistically significant (P for interaction = 0. 85), a noteworthy pattern was observed in the stratified analyses: the positive association was present among individuals with no or one chronic disease, but was attenuated and no longer statistically significant among those with multimorbidity. Conclusions This study reveals a counterintuitive association where higher health literacy is linked to greater OOP health expenditure, challenging the assumption that it is a simple cost-containment tool. To enhance both equity and efficiency, health promotion and insurance reforms should consider tailoring strategies to different health literacy profiles and chronic disease burdens.