Determinants of Out-of-Pocket and Catastrophic Health Expenditure: A Cross-sectional Study

Background: In India, Out of Pocket Health Expenditures (OOPHE) is as high as 70-80% of total health expenditures, borne by the families of ailing persons. In most cases such high OOPHE is catastrophic in nature, in the backdrop of high poverty level in the country. High OOPHE and Catastrophic Health Expenditures (CHE) have a potential to impoverish people. It is therefore important to identify the predictors of OOPHE and CHE, to formulate an equitable and efficient financial protection measure from health expenditure.

Methods: The study tried to understand the factors of out-of-pocket health expenditure and catastrophic health expenditure using the cross-sectional data from 986 sampled households in Koderma district of the state of Jharkhand in India. A multi-staged sampling method was followed to select households with incidences of in-patient care in the last one and child birth in the last two years and of out-patient care in the last one month. Alongside health expenditure data of the sampled households, their socio-demographic and socio-economic information were also collected using survey questionnaire.

Findings: Male headed households, families with more than five members, household head who were unemployed or were engaged in agriculture or labour works as compared to those in service; household head aged above 60 years, households from higher expenditure quintiles, households with any member suffering from chronic illness, households reporting any episode of hospitalisation, in-patient or delivery services availed from private providers in the reference periods, families living closer to service providers especially private providers were significant predictors of high OOPHE.

Residence in rural area (aOR: 1.65, 95% CI 1.10 - 2.49), families living in ‘kutcha’ (mud house) houses (aOR: 1.46, 95% CI 1.06 - 2.0), families with lower social status like Schedule Tribe (aOR: 1.76, 95% CI 1.0 – 3.13), Scheduled Caste (aOR: 1.73, 95% CI 1.02 - 2.92) and Other Backward Classes (aOR: 1.42, 95% CI 1.02 - 2.01) compared to General castes, families where any member suffering from chronic illness (aOR: 2.33, 99% CI 1.48 – 3.67), families where any member had received in-patient care in the last one year irrespective of type of providers (aOR: 2.18, 99% CI 1.60 - 2.97), longer distance from health service providers, had higher likelihood of CHE.

Conclusion: The study tried to identify different predictors of Out of Pocket Health Expenditure (OOPHE) and Catastrophic Health Expenditure (CHE), incurred by families seeking medical care for various ailments. OOPHE was found higher among families from higher expenditure quintile; however, people from disadvantaged socio economic profile had higher likelihood of CHE. Apparently, even smaller OOPHE is proving to be catastrophic for families from lower socio-economic segments. Families with any member suffering from chronic illness were at a higher risk of CHE. OOPHE was considerably higher when services have been sought from private providers compared to public health providers, however, for in-patient care, expenditure incurred in both situations were found to be catastrophic.

Urgent action is needed for designing healthcare finance policies that is more equitable and efficient and has a potential to reduce OOPHE and incidences of CHE.