Socio-Economic Differentials in Impoverishment Effects of Out-of-Pocket Health Expenditure in China and India: Evidence from WHO SAGE

RESEARCH ARTICLE Socio-Economic Differentials in Impoverishment Effects of Out-of-Pocket Health Expenditure in China and India: Evidence from WHO SAGE Kaushalendra Kumar1*, Ashish Singh2, Santosh Kumar3, Faujdar Ram1, Abhishek Singh1, Usha Ram1, Joel Negin4, Paul R. Kowal5 1 International Institute for Population Sciences, Mumbai, India, 2 Indian Institute of Technology Bombay, Mumbai, India, 3 Sam Houston State University, Houston, United States of America, 4 School of Public Health, University of Sydney, Sydney, Australia, 5 World Health Organization (WHO), Geneva, Switzerland * OPEN ACCESS Citation: Kumar K, Singh A, Kumar S, Ram F, Singh A, Ram U, et al. (2015) Socio-Economic Differentials in Impoverishment Effects of Out-of-Pocket Health Expenditure in China and India: Evidence from WHO SAGE. PLoS ONE 10(8): e0135051. doi:10.1371/ journal.pone.0135051 Editor: Rachel A. Nugent, University of Washington, UNITED STATES Received: March 24, 2015 Accepted: July 17, 2015 Published: August 13, 2015 Copyright: © 2015 Kumar et al. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. Data Availability Statement: The data is publicly available at http://apps.who.int/healthinfo/systems/ surveydata/index.php/catalog/sage/about and it can be obtained by sending a request email to . We have accessed data from the World Health Organization’s WHO Multi-Country Studies Data Archive for Study on Global AGEing and Adult Health (SAGE). Data accession number for India - Study on Global Ageing and Adult Health2007, Wave 1 is 638 (http://apps.who.int/healthinfo/ systems/surveydata/index.php/access_licensed/track/ 638) and for China - Study on Global Ageing and Abstract Background and Objectives The provision of affordable health care is generally considered a fundamental goal of a welfare state. In addition to its role in maintaining and improving the health status of individuals and households, it impacts the economic prosperity of a society through its positive effects on labor productivity. Given this context, this paper assesses socioeconomic-differentials in the impact of out-of-pocket-health-expenditure (OOPHE) on impoverishment in China and India, two of the fastest growing economies of the world. Data and Methods The paper uses data from the World Health Organisation’s Study on Global Ageing and Adult Health (WHO SAGE), and Bivariate as well as Multivariate analyses for investigating the socioeconomic-differentials in the impact of out-of-pocket-health-expenditure (OOPHE) on impoverishment in China and India. Results and Conclusions Annually, about 7% and 8% of the population in China and India, respectively, fall in poverty due to OOPHE. Also, the percentage shortfall in income for the population from poverty line due to OOPHE is 2% in China and 1.3% in India. Further, findings from the multivariate analysis indicate that lower wealth status and inpatient as well as outpatient care increase the odds of falling below poverty line significantly (with the extent much higher in the case of inpatient care) due to OOPHE in both China and India. In addition, having at least an under-5 child in the household, living in rural areas and having a household head with no formal education increases the odds of falling below poverty line significantly (compared to a head with college level education) due to OOPHE in China; whereas having at least an under-5 child, PLOS ONE | DOI:10.1371/journal.pone.0135051 August 13, 2015 1 / 19 Impoverishment Effects of OOP Health Expenditure in China and India Adult Health-2007/10, WAVE 1 is 635 (http://apps. who.int/healthinfo/systems/surveydata/index.php/ access_licensed/track/635). not having health insurance and residing in rural areas increases the odds of becoming poor significantly due to OOPHE in India. Funding: The authors have no support or funding to report. Competing Interests: The authors have declared that no competing interests exist. Introduction The provision of affordable health care is generally considered a fundamental goal of a welfare state. In addition to its role in maintaining and improving the health status of individuals and households, it impacts the economic prosperity of a society through its positive effects on labor productivity. The affordability of a health care system is often conceptualized in terms of “financial protection”, that is, individuals and households should be protected from incurring a burden of health care expenditure that would adversely affect their economic wellbeing [1]. Nevertheless, policies in many countries compel households and individuals to cover a substantial portion of healthcare costs out-of-pocket. The annual mean per capita health expenditure was Int$1080 (purchasing power parity [PPP] estimate) globally in 2011 and varied from Int$68 in low income to Int$647 in middle income countries. Of the total health expenditure, per capita government contribution in 2011 was Int$623 worldwide, Int$27 in low income countries and Int$361 in middle income countries, respectively, whereas, out-of-pocket health expenditure (OOPHE) constituted 21% of the total health expenditure in 2011 globally. The percentage of health expenditure covered by OOPHE varied from 47% in low income countries to 34% in middle income countries [2]. In countries where a major part of health care is financed by OOPHE, health expenditures can have impoverishing effects on the economic status of households, especially among the poorer socioeconomic strata [1,3–8]. For example, households in the lowest income quintile and/or with higher inpatient expenses are more likely to borrow or sell assets in order to cope with health care expenses [9]. One analysis of health care financing strategy in 40 low and middle income countries by Kruk, Goldmann, and Galea (2009) revealed that about 26% (one billion) of households borrow or sell their assets to pay for health care [10]. From a policy perspective, health care financing in the absence of any other health security inflates the household consumption expenditure and hence underestimates the actual level of poverty in countries [11]. Though the research on catastrophic health expenditures (CHE) is fairly developed and there are a few studies examining the impoverishment effects of OOPHE across different countries [12–18], detailed analyses of socioeconomic differentials in the impoverishment effects of OOPHE are rare. Therefore, in this paper, we fill this gap by investigating socioeconomic differentials in the impact of OOPHE on impoverishment in China and India. Li et al. (2014) and Li et al. (2012) investigate the extent of CHE and impoverishment from medical expenses in China, but their main focus is on the determinants of CHE rather than the determinants of impoverishment effects [15,16]. Simila (...truncated)