Effect of Health Insurance Program for the Poor on Out-Of-Pocket Inpatient Care Cost in India

Abstract

Background In India, Out-of-pocket expenses accounts for about 62.6% of total health expenditure - one of the highest in the world. Lack of health insurance coverage and inadequate coverage are important reasons for high out-of-pocket health expenditures. There are many Public Health Insurance Programs offered by the Government that cover the cost of hospitalization for the people below poverty line (BPL), but their coverage is still not complete. The objective of this research is to examine the effect of Public Health Insurance Programs for the Poor on hospitalizations and inpatient Out-of-Pocket costs. Methods Data from the recent national survey by the National Sample Survey Organization, Social Consumption in Health 2014 are used. Propensity score matching was used to identify comparable non-enrolled individuals for individuals enrolled in health insurance programs. Binary logistic regression model, Tobit model, and a Two-part model were used to study the effects of enrolment under Public Health Insurance Programs for the Poor on the incidence of hospitalizations. duration of hospitalization, and Out-of-Pocket payments for inpatient care respectively.Results There were 64,270 BPL people in the sample. Individuals enrolled in poor people health insurance program have 1.21 higher odds of incidence of hospitalization compared to matched poor individuals not having health insurance coverage. Enrollment under the poor people health insurance program did not have any effect on duration of hospitalization and inpatient Out-of-Pocket health expenditures. Logistic regression model showed that chronic illness, household size, and age of the individual had significant effects on hospitalization incidence. Tobit model results showed that individuals who had chronic illnesses and belonging to other backward social group had significant effects on duration of hospitalization. Two-part regression model showed that days of hospital stay, graduate level education, specific age groups, using a private hospital for treatment, admission in a paying ward, and having some specific ailments had significant positive effect on out-of-pocket costs. Conclusions Enrolment in the public health insurance programs for the poor increased the utilization of inpatient health care facilities. Health insurance coverage must be expanded to cover outpatient services, and the coverage must not be limited by the number of family members.