Out-of-pocket Payments for Healthcare in India

Abstract

This paper examines the impact of out-of-pocket (OOP) health payment on impoverishment of poorest households using unit-level records of latest (68th: 2011–2012) round data of National Sample Survey Organisation (NSSO). This is examined by estimating the prevalence, intensity and incidence of catastrophic health payments across different economic stratum households, rural-urban residents and states. Estimates show that high OOP expenditure on healthcare has serious repercussions for households’ well-being in India, as it plunges a sizeable section of the society even the well-off to abysmal poverty levels. It pushes 3.5 per cent (50.6 million) people below poverty line and also causes further deepening of poverty for already poor people. The rural, lowest above poverty line (APL) quintile and households from low-income states (like Uttar Pradesh and Bihar) experienced a large increase in poverty headcounts and poverty deepening impacts. Any health policy initiative directed towards these groups and regions may lower down the catastrophic burden.