Health Insurance Program for the Poor, Out-Of-Pocket Costs, and Catastrophic Health Expenditures in India

Background India is currently taking steps to provide Universal Health Coverage (UHC) as envisaged in its National Health Policy 2017. Financial protection is considered the backbone of UHC. In India, OOP expenses accounts for about 62.6% of total health expenditure - one of the highest in the world. Out of 1.324 billion people in India, around 12.4% of the population is below the poverty line. Lack of health insurance coverage and inadequate coverage are important reasons for high OOP health expenditures. High OOP health expenditures push many households into poverty. The objective of this research is to examine the effect of Public Health Insurance Programs for the Poor on hospitalizations and inpatient OOP health expenditures, and to investigate the effect of OOP heath care payments on catastrophic health expenditures (CHE). Methods Data from the recent national survey by the National Sample Survey Organization, Social Consumption in Health 2014 were used. A propensity score matching was used to match the people enrolled and not enrolled in health insurance programs. Binary logistic regression model, Tobit model, and a two-part model were used to study the effects of enrolment under Public Health Insurance Programs for the Poor on the incidence of hospitalizations, duration of hospitalization, and OOP payments for inpatient care respectively. Three different analytical approaches were used to investigate CHE: (i) incidence and intensity of CHE, (ii) socioeconomic inequality in CHE, and (iii) factors affecting CHE. Results Health insurance programs for the poor increase the incidence of hospitalization but has no effect on the duration of hospitalizations and inpatient OOP health expenditures. Presence of chronic illness, belonging to older age groups, women in the reproductive age group, and belonging to a small household have higher hospitalization. People who have higher duration of hospital stay, admitted to a private hospital, using allopathic treatment, having chronic illnesses, having higher level of education and belonging to the middle age group experienced higher OOP inpatient health expenditures. Presence of health insurance coverage reduced both the incidence and intensity of CHE. CHE incidence was 10.94% and the mean positive overshoot was 35.94%. Households with members at extremes of age, female member, utilized a private hospital, and small households have higher incidence of CHE. Households belonging to the poor socioeconomic status, and with members having higher duration of hospital stay, and chronic illness experienced both higher incidence and intensity of CHE. Conclusions By identifying the groups most affected, this research aids the designers of the national insurance programs to design better benefit packages for those population groups. This investigation will serve as a basis for assessing India’s policy options to reduce financial burden due to OOP health expenditur