Abstract Background Equity in health financing as one main aspect of health equity plays an essential role on the path toward universal health coverage. Out of pocket payment (OOP), a source with high share to total health expenditure, is an inequitable mechanism for health financing. Main body The OOP has been considered regressive (Kakwani index with a negative value) in nature. However, in some studies especially in developing countries, it is reported to be progressive (Kakwani index with a positive value). The main questions are: Is the progressive OOP equitable? What causes this contradiction? What can we do for the proper interpretation? And what are policy implications of this issue? In this commentary we briefly elaborate on these issues. We present several reasons for progressivity of OOP, and several methodological and policy issues for addressing it. Conclusions Even if the OOP is progressive and the share of poor people is low, this may financially limit their access to health services, increase their risk of incurring catastrophic health expenditure (CHE), and even pushing them more into poverty. In order to provide a comprehensive picture of equity in health financing, other financial protection indicators such as the redistributive effect, re-rating, exposure to CHE, and impoverishment due to health expenditure should also be estimated and reviewed.