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ORIGINAL ARTICLE Table of Contents  
Ahead of print publication
Determinants of Out-of-Pocket Health Care Expenditures and Financial Coping Strategies among Beneficiaries of a State-Run Health Insurance Scheme in South India

1 Department of Community Medicine, Sri Lalithambigai Medical College and Hospital, Chennai, Tamil Nadu, India
2 Department of Community Medicine, NRI Institute of Medical Sciences, Visakhapatnam, Andhra Pradesh, India
3 Department of Community Medicine, Trichy SRM Medical College and Hospital and Research Centre, Trichy, Tamil Nadu, India
4 Department of Community Medicine, Chettinad Medical College and Hospital, Chennai, Tamil Nadu, India

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Date of Submission24-Aug-2022
Date of Decision07-Oct-2022
Date of Acceptance30-Oct-2022
Date of Web Publication02-Dec-2022


Background: The household spending for health care in terms of out-of-pocket expenditures (OOPEs) in India remains one of the highest in the world at around 55% of current health expenditures and 48% of total health expenditures. Hence, it becomes extremely important to explore the determinants, i.e., the factors leading to OOPE.
Objectives: To explore the determinants of OOPE and the financial strategies undertaken by the households to cope up with OOPE.
Methodology: A longitudinal study was conducted among chronic kidney disease (CKD) patients who availed care at a Tamil Nadu Chief Ministers Comprehensive Health Insurance Scheme empanelled health care facility. They recorded their OOPE over a period of 6 months in the hand-book provided to them. An interview schedule was administered at the end of 6 months, to explore the determinants of OOPE and coping strategies.
Results: Among the sociodemographic characteristics, age and gender had an impact on OOPE. Females had higher OOPE (INR 10,100) when compared to that of males (INR 9360) and with increased age of more than 60 years, there was a dip in OOPE (<60-INR 11,072; >60-INR 10,100). The duration of current treatment has been another important determinant, whereas borrowings were the most predominant financial strategy to cope up with OOPE.
Conclusion: Despite having the health insurance coverage sponsored by government, CKD patients had OOPE pertaining to the various aspects such as age, gender, comorbidities, and number of members in the household utilizing the scheme and the coverage amount under the scheme.

Keywords: Catastrophic health expenditures, health insurance, out-of-pocket health expenditures

How to cite this URL:
John A, Avirneni HT, Swaminathan SS, Abhina S. Determinants of Out-of-Pocket Health Care Expenditures and Financial Coping Strategies among Beneficiaries of a State-Run Health Insurance Scheme in South India. MRIMS J Health Sci [Epub ahead of print] [cited 2023 Mar 30]. Available from: http://www.mrimsjournal.com/preprintarticle.asp?id=362540

  Background Top

Improving access to health care services for their citizens has been the priority for many developing countries worldwide. In this direction, various solutions were formulated and devised. One such solution which has been well tested and well promoted is health insurance. With risk pooling at its core, health insurance has been considered to be the most important financial risk mitigation strategy. Furthermore, through insurance mechanism, avoidance of cash payments toward fees is possible, thus by increasing the financial risk protection.[1] It is also considered to be the best means to ensure access to health care delivery systems and therefore as an important aspect to progress toward Universal Health Coverage (UHC).[2]

India has been one of many countries to adopt this strategy to achieve UHC. This led to the launch of various government sponsored health insurance schemes at the national and state levels. These policy reforms incorporated into health insurance schemes aimed at providing financial risk protection to the individuals and their households, with priority to those living in poverty, who are more vulnerable to such financial risks.[3] However, despite such policy reforms, the household spending for health care in terms of out-of-pocket expenditures (OOPEs) remains one of the highest in the world at around 55% of current health expenditures and 48% of total health expenditures.[4] Hence, it becomes extremely important to understand the determinants, i.e., the factors leading to OOPE.

Although a few studies reported on the determinants of OOPE, none of them have taken into account, the health insurance coverage among the study participants.[5],[6],[7],[8],[9] Therefore, through this community-based longitudinal study, we aimed at understanding such determinants among the chronic kidney disease (CKD) patients, availing care under Tamil Nadu Chief Ministers Comprehensive Health Insurance Scheme (TN-CMCHIS) in South India. CKD patients often are prone to have recurrent expenditures as they had to undergo continuous follow-ups for maintenance hemodialysis. This also requires frequent visits to a near-by health care facility on a continuous basis, making them a suitable cohort to understand the OOPE related aspects in the context of a chronic disease in a prospective manner. Under TN-CMCHIS which is one of those policy level reforms aimed at providing financial protection from the consequences of ill-health, high quality health care services are being delivered serving the health needs of people suffering from CKD at various empanelled health care facilities.[10] One such facility which was recognized for having the best-in-class facilities for hemodialysis in and around the region was where this study was undertaken.

  Methodology Top

This was a community-based longitudinal study among the CKD patients availing care at a TN-CMCHIS empaneled health care facility. CKD patients (206) who availed care from January 2018 to December 2018 formed the study population. Based on the inclusion criteria set, i.e., 163 of those who required maintenance hemodialysis and residing within 30 kilometers from the empaneled health care facility were purposively and consecutively enrolled into the study on a monthly basis. The data collection was carried out for a period of 1½ year from January 2018 to June 2019 after obtaining ethical clearance from the Institutional Human Ethics Committee (IHEC).

The secondary data were obtained from the CMCHIS section on a monthly basis at the end of every month and the same was utilized to profile the respective health condition and cost of treatment procedures approved under the scheme for each of them. After recording and analyzing the details of the beneficiaries in that particular month, the primary data collection succeeded it. House-to-house visit was made at the end of every month in the chronological order of discharge dates of beneficiaries that was obtained from the secondary data from CMCHIS section at the facility.

After introducing and explaining about the study project to the beneficiary and caretaker at home, informed consent was obtained from the beneficiary. Then a diary (mini book) and a pen was handed over to beneficiary at each household and requested him/her to document OOPE for the period of next 6 months, related to their then existing health condition (CKD) for which they availed the health care at MGMC&RI under the scheme and required subsequent follow-ups. The care taker at home was also given instructions on how to document OOPE on behalf of the patient and to make sure on continuous recording of the expenses. To ensure the compliance of their documentation and to clarify any queries, they were contacted telephonically at least once in a month after getting their permission to contact them over the phone. Although majority of them were contacted telephonically, those, whom the investigator failed to contact after continuous attempts were followed-up at the time of their subsequent visit to the health care facility.

At the end of 6 months, a subsequent house visit was made to the respective households to collect the diary and also to administer the interview schedule. A newly developed, validated and pretested, semi-structured open-ended interview schedule was administered among the study population. This study tool had sections on socio-demographic and economic details, enrolment in the scheme, awareness on the features of the scheme, financial strategies and also was pretested in a pilot study undertaken at the institute prior to the initiation of this study.[10]

The data were entered in Microsoft Excel 2016 and were analyzed using Statistical Package for the Social Science (IBM, SPSS) version 16.0. Qualitative variables were summarized as percentages. In case of variables that did not follow normal distribution, the median and inter quartile range was used to summarize them. The association between categorical variables and OOPE (continuous variables) was assessed using nonparametric tests, like Mann–Whitney U-test (for two independent groups) and Kruskal–Wallis test (for more than two independent groups). P ≤ 0.05 was considered to be statistically significant.

Ethical considerations

Approval from Institutional scientific committee and clearance from IHEC was obtained prior to the start of the research project. Informed written consent was obtained from all the study participants before their enrollment into the study. All the necessary measures were taken to overcome the risk of participation for the study participants as per Indian Council of Medical Research 2017 guidelines. Furthermore, confidentiality of the household/beneficiary was given the utmost importance at all the times.

  Results Top

Among the beneficiaries, three fourth were males (75.5%) and more than half of them belong to age more than 60 years (56.4%). Majority of them only had primary level of education (39.3%) and 34.4% were semi-skilled workers. It was observed that majority of the beneficiaries' households (60%) had 3 or <3 members in a family. The average monthly income among the beneficiaries households was INR 10,383 and their monthly consumption expenditure was INR 9398 of which they were using INR 6203 for food-related expenditures. The total median OOPE over a period of 6 months was INR 9540 (6990–13,300). The median OOPE was found to be the highest in the 4th month at INR 1900 and lowest in the 1st and 5th months at INR 1400. The maximum OOPE was for care taker (INR 3428) and the least amount (INR 739) was spent on investigations [Table 1]. More than half of the beneficiaries had utilized the maximum ceiling amount (55.4%), while almost two-third of them had a member in the family who have utilised the scheme in the same year. Age and gender had a significant impact on the total OOPE incurred [Table 2]. It was observed that females and those who are above 60 years old had to spend more on accommodation, while occupation had an association with care taker charges and transportation [Table 3]. Furthermore, duration of current treatment had an impact on the total OOPE incurred among the beneficiaries [Table 4]. At the time of interview, the beneficiaries were asked about how they managed their OOPE, i.e., the financial coping strategies by households to pay from their pocket for the health care of CKD. The answers were categorized and were represented in percentages. It was observed that, a higher number of beneficiaries (40.5%) had borrowed money with interest from money lenders or by taking loans to cope up with the OOPE. Selling of the families' assets was also a coping strategy among 19.6% of the households [Table 5].
Table 1: Out-of-pocket expenditures (INR) split up over a period of 6 months among beneficiaries (n=163)

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Table 2: Association of sociodemographic characteristics with total out-of-pocket expenditures among the beneficiaries (n=163)

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Table 3: Sociodemographic determinants of out-of-pocket expenditures split up among the beneficiaries (n=163)

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Table 4: Current diagnosis related determinants with total out-of-pocket expenditures among the study participants (n=163)

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Table 5: Association of financial strategies with total out-of-pocket expenditures among beneficiaries (n=163)

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  Discussion Top

The present study highlights the importance of understanding the determinants of OOPE among the CKD patients, despite the financial protection from a Government health insurance scheme. The age and gender had an impact on OOPE among the CKD patients. Females and nonelderly patients had increased OOPE when compared to that of males and elderly patients. It was also observed that with increased educational and occupational level, there has been a rise in OOPE. A national study from Nigeria observed that individuals with lower levels of education and just being employed are more likely to incur OOPE.[7] The variation in these findings might be due to the differences in setting as per the socio-economic development and also in the methodology adopted in the study. In contrast to the direct recording of OOPE, relying only on secondary data would have led to the observation of such patterns. A study on the determinants of OOPE in the rural population of West Bengal reported findings in contrast, attributing to the study participants with different morbidities, while only CKD patients in our study.[5] However, in various studies from different settings, it was observed that chronic disease had a direct positive impact on the OOPE.[5],[6],[7],[8],[9] Patients suffering from chronic diseases such as CKD would have to rely on continuous care with regular follow-ups in addition to regular medication and interventions, with an increased dependency on the caretakers. Similar to the findings reported in a study from South India, developing co-morbidities along the course of the treatment are likely to increase the OOPE as additional expenditure would incur along with the regular expenditure for the current diagnosis.[6] The utilization of maximum ceiling amount provided under the scheme also led to increased OOPE. The saturation till the maximum amount would push the patients to a difficult position where they had no other choice but to use their money. Furthermore, the number of family members in the household along with their health status had an impact on OOPE. Similar findings reported across different studies are most probably due to the similarity in patterns related to the household size and the health status of the family members and number of times of utilization of scheme in a given year, leading to the saturation of financial cap provided under the scheme.

In a study conducted by Sangar et al., coping mechanisms related to OOPE payments in various states in India were explored. In the absence of risk pooling measures such as health insurance, people had used different strategies to source their finance for OOPE. The different coping strategies were savings, borrowings, selling of assets, and contributions from friends or relatives. They have also found that there is a difference in coping mechanisms across various states for spending on outpatient and inpatient care. Savings was the primary source among the households to cope up with inpatient care related OOPE. Borrowing money was prevalent in states such as Tamil Nadu, Andhra Pradesh, and Karnataka. In the present study, the primary source of financing OOPE was through borrowing. The difference in findings when compared to other states would be due to the lack of health insurance schemes in those states, thereby leading to OOPE on inpatient care by the households as opposed to the states which had insurance schemes, thereby making OOPE for inpatient care under the scheme till the coverage amount.[11]

Daivadanam et al. in their study among Acute Coronary Syndrome (ACS) patient households have explored various coping strategies adopted by households to counter the OOPE related to ACS care. They have found out that the most predominant strategy among the households was loans. Few of the households exclusively managed their OOPE from their savings. The combination of savings, loans was among majority of them and only a minor portion of them got their OOPE covered under health insurance. In the present study, the most predominant coping strategy among the households to cope up with OOPE for CKD care was found to be borrowings with interest.[12]

While house-house visit has added a much-needed empathy for the beneficiaries, longitudinal follow-up for a period of 6 months to estimate the OOPE with patients self-recording adds a much-needed facet to the findings. However, the use of convenient sampling for selecting the patients may limit the generalizability of the results, and hence, findings may differ at the state level. Furthermore, ccomparison of results across urban and rural households would have been an added finding, while verification of patients OOPE recordings was not feasible.

  Conclusion Top

Despite having the health insurance coverage sponsored by government, CKD patients had OOPE pertaining to various aspects such as age, gender, comorbidities and number of members in the household utilizing the scheme and the coverage amount under the scheme. This study tried to explore such determinants and understand which had an impact on OOPE incurred, in only a cohort of CKD patients. Although, recommending the increase in the coverage amount per family per year is ideal, however, it is extremely important to understand these determinants in a comprehensive manner.

Strengths and limitations

Adopting a longitudinal study design has been one of the major strengths of this research, which facilitated patients self-recording of the OOPE eliminating the possibility of potential bias usually observed in OOPE studies. However, incorporating mixed methods design would result in a more comprehensive data, which can facilitate in a better understanding of the determinants through the triangulation of data. In addition, it is important to consider and explore the level of awareness on the features of health insurance schemes and health care pathways of the patients, which can possibly have an effect on the OOPE. The use of convenient sampling for selecting the patients may limit the generalizability of the results. Although an attempt has been made in ensuring the authenticity and completeness of data by adopting patients self-recording of OOPE and monthly telephonic contact, verification of the same was not feasible in this study.

Financial support and sponsorship


Conflicts of interest

There are no conflicts of interest.

  References Top

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Correspondence Address:
Hari Teja Avirneni,
Department of Community Medicine, NRI Institute of Medical Sciences, Visakhapatnam - 531 163, Andhra Pradesh
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Source of Support: None, Conflict of Interest: None

DOI: 10.4103/mjhs.mjhs_86_22


  [Table 1], [Table 2], [Table 3], [Table 4], [Table 5]


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