Catastrophic out-of-pocket payment for health care and its impact on households: Experience from West Bengal, India

Swadhin MondalBarun KanjilalHenry Lucas

iHEA Conference Toronto 2011

IIHMR

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• Population around 81 million.

• Highest population density of any state in India: 904 persons per square km.

• Almost 25% 0f population living below poverty line.

Study Area: West Bengal

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Context

• The government has substantially increased the health sector budget, but due to inequities in resource allocation this has not substantially improved access to quality services for the poor.

• Out-of-pocket (OOP) payment is the major health financing mechanism (~80%).

• OOP often places a huge financial burden on poorer households

• Financial protection mechanisms, especially for poor rural households, are few and very limited.

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• Primary data collected from three districts

• Covered 3,152 households comprising 15,206 individuals

• Data collected related to: • Inpatient care

• Outpatient care

• Delivery

• Chronic illnesses.

Household Survey

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Health expenditure as a percentage of total household expenditure by various category of treatment (rural and urban)

11.55

4.035.73

3.96

9.21

2.454.14 4.69

10.81

3.495.16

4.15

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6

8

10

12

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Rural Urban All

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Percentage of households facing catastrophic health expenditure (>40% of non-food expenditure.)

10.19

11.32

6.55

0

2

4

6

8

10

12

All Rural Urban

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Significant determinants of catastrophic health expenditure (>40% non-food expenditure)

• Chronic illness (odds ratio 3.0)

• Inpatient care (odds ratio 1.3)

• Other household characteristics: Number of dependents (aged and

children) (odds ratio 1.4) Rural location (odds ratio 2.1)

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Vulnerability indicator• Removed children from education

• Reduced food consumption

• Postponed daughter’s marriage

• Stopped medical treatment of other member

• Reduced social obligations / functions

• Stopped purchase of consumer durables

• Stopped purchase or expansion of house

• Reduced household savings

• Borrowed with interest

• Borrowed without interest

• Sold property

• Mortgaged property

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Findings

• Catastrophic expenditure associated with outpatient visits was associated with a much greater impact on vulnerability index than catastrophic expenditure associated with inpatient care

• This is partly a consequence of the fact that outpatient catastrophic expenditure tended to be associated with poorer households.

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Discussion

• Healthcare expenditure for chronic illness was the most important determinant of catastrophic expenditure – substantially ahead of hospitalization.

• Expenditure on chronic illness acts as a cumulative burden that gradually drives households into poverty.

• Catastrophic heath expenditure on minor illnesses, strongly associated with poorer households, had the greatest impact on economic status.

• High healthcare expenditure for the poor often resulted in substantial reductions in consumption expenditures on food, education, and social activities.