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How healthy is health payment mechanism in India: Critical analysis of out-of-pocket payment on poverty estimates in Indian population
Ekta Pandey

##manager.scheduler.building##: Velodromo - Bocconi University
##manager.scheduler.room##: N05
Date: 2019-01-25 02:00 PM – 03:30 PM
Last modified: 2018-12-26

Abstract


Healthcare financing in many countries is still predominantly sourced by out- of-pocket (OOP) expenditure. In the absence of pre-payment mechanisms magnitude of impact during an episode of illness tremendously increases on poverty. The objective in this paper is to estimate the impact of out-of-pocket payments on the level of living in India using poverty estimates.

The paper uses National Sample Survey 71st round data on health to measure poverty level using headcount ratio and poverty gap taking in consideration the possible effect of healthcare expenses. Tendulkar poverty line accounting possible inflation using CPI index is used at country level and state level across both rural and urban regions.

Result show an increase in headcount ratio by 6.4% across both rural and urban areas. While the poverty impact measured in terms of poverty gap shows higher poverty deepening in rural areas (by increase of Rs13.15) than urban areas (Rs. 10.66 poverty gap). Results clearly indicate that with low insurance coverage and uncertainty of health expenses, chances of crossing the poverty line even with a single episode of illness is very high in India. This calls for targeted policy measures to provide hedging against the ill-effects of poor financing.

 


Keywords


Out of pocket payment, catastrophic expenditure, impoverishment