Potential Impact of the Insurance on Catastrophic Health Expenditures Among the Urban Poor Population in India

Abstract

Background: Urban poor face a disproportionate burden of ill health and high out-of-pocket expenditure (OOPE), creating a severe unmet need for affordable and quality health care. This article highlights the impact of health insurance on OOPE and catastrophic healthcare expenditure among the urban poor of India. Methods: The study uses randomly collected household data from a baseline survey conducted in the states of Rajasthan and Uttar Pradesh. Separate Insurance impact models have been generated for the analysis. Results: Mean out-of-pocket health expenses is higher in the private health facility for the inpatient care but in case of outpatient care, the expenditure was more in public. Expenditure on medicine constitutes the largest part of the total OOPE. Insurance impact model shows that coverage on medicine alone can reduce medical impoverishment by 85% in the case of Outpatient Deparment (OPD) and 71% in the case of Inpatient Department (IPD). The urban poor preferred private facility for treatment in case of illness, albeit when it comes to delivery, they prefer public facility Conclusions: Study findings indicate overt reliance on private health care must be regulated, to reduce OOPE among the urban poor. Also, effective universal health insurance can go a long way in reducing the OOPE with availability of free medicines and diagnostics in the public health facilities.