Policy intervention for access to medicine: Does it work similarly for poor and non-poor?

Abstract

Many federal states in India have recently taken steps to improve distribution and affordability of medicines across public hospitals for reducing high out-of-pocket (OOP) expenditure. West Bengal has introduced a Public-Private Partnership (PPP) scheme, Fair Price Medicine Shops (FPMS) within government hospitals in 2012, which offers high discounts on maximum retail price of the drugs. This model introduces the state as a facilitator, rather than provider or financer, of health care. This paper attempts to measure its impact on OOP expenditure (OOPE) of patients using propensity-score-matching technique on the data collected from primary survey among patients. The study finds that although for non-poor patients, the average OOPE has reduced significantly, the impact has been counter-productive for the poor patients, hinting that PPP intervention seems to work only for relatively better-off people, as the best alternative for the poorest remains to be free provision of drugs from the government. The difference in outcome lay in the fact that the nature of control groups differed between poor and non-poor patients. Those poor patients who did not visit FPMS received most of the medicines free (hence OOPE nearly zero), while for the non-poor patients not visiting FPMS bought the drugs from outside retail shops.