Impact of health insurance on out-of-pocket health expenditure among inpatients in India

Background Introduction of advanced technologies in health sectors have caused high treatment and diagnostic cost to the patients. In developing countries direct out of pocket expenditure is the principle means to cope up with the great burden of health expenditure. Predominant OOP expenditure in health is indicative of a highly regressive health care system as well as poverty.1Objective To estimate the impact of Health insurance plans on OOP health expenditure in India.Methodology The study used 71st round of National Sample Survey NSS data from January to June 2014 on social consumption section 25.0.With multi stage sampling 65932 households and 333104 persons were selected. OOP expenditure was calculated as the difference between total medical expenditure and the amount reimbursed for a person. Univariate and bivariate analysis was used to see the distribution of health insurance coverage. To investigate the variation in coverage at different level of sampling multilevel logistic regression analysis was performed and intra class correlation coefficient was used. Results Male are more covered by any schemes of health insurance than female. People from smaller family size are more likely to have health insurance than people from bigger families. 18 urban people are under coverage while its only 14 for rural people. 4 of the residual variance in the coverage of health insurance is explained due to the change in state while 5 is explained by the change in FSU village. In OLS model the mean OOP health expenditure is 5058.57 Rs for insured person whereas 6063.55 Rs for an un-insured person.Conclusion It shows a reduction of 5136.97 Rs in OOP expenditure for an insured person compared to an uninsured person. We can say that OLS suppress the effect of health insurance on the incidence of OOP health expenditure.