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Refining estimates of catastrophic healthcare expenditure: an application in the Indian context

International Journal of Health Care Finance and Economics volume 13, pages 157–172 (2013)Cite this article

Abstract

Empirics of catastrophic healthcare expenditure, especially in the Indian context, are often based on consumption expenditure data that inadequately informs about the ability to pay. Use of such data can generate a pro-rich bias in the estimation of catastrophic expenditure thereby suggesting greater concentration of such expenditures among richer households. To improve upon the existing approach, this paper suggests a multidimensional approach to comprehend the incidence of catastrophic expenditure. Here, we integrate the information on health expenditure with other social and economic parameters of deprivation. An empirical illustration is provided by using nationally representative survey on morbidity and healthcare in India. The results of the multidimensional approach are consistent with the theoretical underpinnings of the ability-to-pay approach and emphasizes on the severity of the problem in rural areas. The suggested methodology is flexible and allows for context-specific prioritization in selection of parameters of vulnerability while estimating the incidence of catastrophic expenditures.

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Notes

  1. The incidence and intensity is captured through indices for catastrophic payment headcount—indicating proportion of households whose expenditures (as a proportion of their income) exceeds the specified threshold and catastrophic payment gap—the aggregate or average amount by which payments (as a proportion of their income) exceeds the specified threshold.

  2. According to the Indian Census Office, a pucca house is one, which has walls and roof made of the following material: wall material—burnt bricks, stones (packed with lime or cement), cement concrete, timber, ekra etc. Roof material : tiles, GCI (Galvanised Corrugated Iron) sheets, asbestos cement sheet, RBC (Reinforced Brick Concrete), RCC (Reinforced Cement Concrete) and timber etc.

  3. The constitution of India gives a special status to historically disadvantaged castes and tribes called Scheduled Castes and Scheduled Tribes (SC/ST) and other socially, educationally and economically deprived communities termed as Other Backward Class (OBC).

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Affiliations

  1. Health Policy Research Unit, Institute of Economic Growth, University of Delhi Enclave, Delhi, 110007, India

    Indrani Gupta

  2. Population Research Centre, Institute of Economic Growth, University of Delhi Enclave, Delhi, 110007, India

    William Joe

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  1. Indrani Gupta
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  2. William Joe
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Correspondence to William Joe.

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Gupta, I., Joe, W. Refining estimates of catastrophic healthcare expenditure: an application in the Indian context. Int J Health Care Finance Econ 13, 157–172 (2013). https://doi.org/10.1007/s10754-013-9125-6

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  • DOI: https://doi.org/10.1007/s10754-013-9125-6

Keywords

  • Catastrophic expenditure
  • Out-of-pocket health expenditure
  • Targeting
  • Health policy
  • India

JEL Classification

  • I1