Decline In Out-Of-Pocket Expenditure
Kartavya Desk Staff
Syllabus: Health
Source: PIB
Context: The National Health Accounts (NHA) 2021-22 data highlights a significant decline in Out-of-Pocket Expenditure (OOPE) on healthcare, attributed to increased government investments, enhanced public healthcare infrastructure, and expanded health insurance coverage.
What is Out-of-Pocket Expenditure (OOPE)?
• Definition: OOPE refers to direct payments made by individuals for healthcare services such as consultations, medicines, diagnostics, and hospitalizations.
• Impact: High OOPE often burdens low-income families, leading to financial hardships, debt, and reduced access to essential healthcare services.
Recent trends in OOPE:
• OOPE as a percentage of Total Health Expenditure (THE) has consistently declined over the years.
• Increased government spending and social security initiatives have helped reduce the financial burden on individuals.
• Per capita health expenditure tripled from ₹1,108 in 2014-15 to ₹3,169 in 2021-22.
Reasons for Decline in OOPE:
• Increased Government Health Expenditure (GHE): GHE as a percentage of GDP rose from 1.13% in 2014-15 to 1.84% in 2021-22. Greater funding improved public healthcare services and affordability.
E.g. Investments in rural healthcare centres.
• Expansion of Social Security Expenditure (SSE): SSE on health grew from 5.7% to 8.7% of THE between 2014-15 and 2021-22. Shielded vulnerable populations from catastrophic health expenditures.
E.g. Rashtriya Swasthya Bima Yojana.
• Government-funded insurance schemes: Programs like Ayushman Bharat provided insurance coverage to economically weaker sections. Reduced dependence on personal savings for healthcare.
E.g. Ayushman Bharat PM-JAY covering 50 crore beneficiaries.
• Focus on Public Health Infrastructure: Investments in healthcare facilities and workforce training made services more accessible.
E.g. Setting up primary healthcare centres in underserved regions.
• Covid-19 response: Pandemic-driven health investments laid the groundwork for affordable long-term healthcare.
E.g. Increased funding for ICU and ventilator facilities.
Implications of Reduced OOPE:
• Improved Healthcare Accessibility: Affordable services encourage timely medical interventions, especially in rural areas.
E.g. Free diagnostic services in government hospitals.
• Stronger public healthcare system: Reduced OOPE allows public health systems to cater to broader populations.
E.g. Enhanced capacity for vaccination drives.
• Better health outcomes: Access to preventive care reduces severity and costs of illnesses.
E.g. Regular screenings for non-communicable diseases.
• Increased financial stability: Families can allocate resources toward essentials like education and nutrition.
E.g. Low-income families spending less on emergency healthcare.
• Foundation for Universal Health Coverage (UHC): Strengthened public funding aligns with India’s goal of achieving UHC.
E.g. Affordable healthcare for marginalized groups.
Way ahead:
• Expand health insurance coverage: Ensure broader access to government-funded health insurance programs.
• Strengthen primary healthcare: Enhance rural healthcare infrastructure and workforce training.
• Public awareness campaigns: Educate citizens about health schemes and preventive care.
• Digital health solutions: Leverage technology for accessible and cost-effective healthcare delivery.
• Focus on Non-Communicable Diseases (NCDS): Increase investment in NCD prevention and management programs.
Conclusion:
The declining OOPE reflects India’s commitment to an inclusive healthcare system. With continued investments in public health infrastructure and insurance schemes, the nation is moving closer to achieving Universal Health Coverage (UHC). This shift ensures financial protection for households, equitable access to quality healthcare, and a healthier population.
Insta Links:
• “Besides being a moral imperative of a Welfare State, primary health structure is a necessary precondition for sustainable development.” Analyse. (UPSC-2021)