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Table of Contents
Year : 2022  |  Volume : 8  |  Issue : 2  |  Page : 110-114

Health insurance coverage and out-of pocket expenditure: A study among rural and urban households of Faridabad, Haryana

1 Department of Community Medicine, ESIC Medical College and Hospital, Faridabad, Haryana, India
2 Department of Community Medicine, SHKM GMC, Nuh, Haryana, India
3 Department of Pathology and Lab Medicine, Medanta Hospital, Gurgaon, Haryana, India

Date of Submission13-Oct-2021
Date of Decision21-Apr-2022
Date of Acceptance29-Apr-2022
Date of Web Publication31-Dec-2022

Correspondence Address:
Dr. Pooja Goyal
Department of Community Medicine, ESIC Medical College and Hospital, Faridabad, Haryana
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Source of Support: None, Conflict of Interest: None

DOI: 10.4103/ijcfm.ijcfm_83_21

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Introduction: Catastrophic health spending is one of the major factors pushing people into poverty. Reducing “out-of-pocket expenditure (OOPE)” on health through health insurance coverage is an effective approach. The objectives of this study are (1) to estimate health insurance coverage among rural and urban households (HHs) and (2) to determine the proportion of income spent on health as OOPE among the selected HHs.
Material and Methods: A cross-sectional study was conducted in rural and urban parts of district Faridabad, Haryana. A sample of 374 were taken from rural and urban areas. The unit of the study was HHs in both the areas. The proportion of income spent on health care (both direct and indirect expenses included) as OOPE was taken as outcome variable.
Results: Health insurance coverage was higher among urban HHs (58.0%) as compared to the rural (38.5%). The rural population was availing of private consultation, laboratory, and pharmacy services to a greater extent than the urban; hence, they were spending a substantial proportion of their income on health-care services. The majority of the HHs in the rural and urban areas spent up to 20% of their income on health care.
Conclusion: Universal health coverage without health insurance is unlikely.

Keywords: Health insurance, out-of-pocket expenditure, universal health coverage

How to cite this article:
Singh M, Goyal P, Narang S, Singh A, Singal M. Health insurance coverage and out-of pocket expenditure: A study among rural and urban households of Faridabad, Haryana. Indian J Community Fam Med 2022;8:110-4

How to cite this URL:
Singh M, Goyal P, Narang S, Singh A, Singal M. Health insurance coverage and out-of pocket expenditure: A study among rural and urban households of Faridabad, Haryana. Indian J Community Fam Med [serial online] 2022 [cited 2023 May 28];8:110-4. Available from: https://www.ijcfm.org/text.asp?2022/8/2/110/366553

  Introduction Top

The theme of World Health Day 2019 was universal health coverage (UHC) everywhere and for everyone. UHC means that everyone can use effective health services when they need them without experiencing financial hardship.[1] Moving toward UHC involves meeting three distinct goals: (i) providing access to needed health services, (ii) ensuring services are of sufficient quality to be effective, and (iii) securing financial protection.[1]

In many low- and middle-income countries, a large proportion of health expenditure is paid out of pocket (OOP) by households (HHs). This results in catastrophic health expenditure and impoverishment in many Asian countries, particularly India, where only 14% of rural and 19% of the urban population are covered by health insurance.[2] Public investment in health is low, and the government spends a meager proportion of its gross domestic product. To add to this, there is a lack of human resources and poor health infrastructure, which increase the cost and the financial burden of care.[3] The poor population trying to fulfill their basic needs in their day-to-day life forgo their health-care needs. Hence, the lower middle and lower class tend to be pushed to catastrophic OOP expenditure (OOPE) and further becoming poorer.[4] Increasing privatization, the rising cost of health care, and inadequate insurance coverage (only for in-patient expenses) ensure that an increasing number of people will keep falling into poverty in the future.[5]

Health insurance is emerging as an alternative to reducing the financial burden of the people. Existing health insurance coverage is insufficient in India and is largely limited to a small proportion of people in the organized sector. As a matter of relief, health insurance coverage is gradually increasing. Various factors responsible for this may be the high health-care cost, entering of the private players in the insurance field, government universal health insurance policy, and intervention of community-based health insurance schemes. Hence, this study was conducted to estimate health insurance coverage and to understand the pattern of OOPE as a proportion of income in the rural and urban areas of Faridabad, Haryana.

  Material and Methods Top

This was a descriptive cross-sectional community-based study conducted between June and December 2020. Residents of the urban field practice area (sector seven, Faridabad) and rural field practice areas (village Pali, Faridabad) of the medical college were the study population.

Taking the prevalence of health spending by HHs as 41.9% from previous literature[6] at 5% absolute error and 95% confidence interval, the minimum sample size was calculated to be 374.

HHs of the rural and urban areas were the unit of the study. Exclusion criteria include (i) those who were not able to understand the study and refused to participate, (ii) those not living with family or were single, and (iii) those who were not residents of the selected areas.

The sampling frame was available for village Pali and sector 7 as these are the rural and urban field practice areas of the department of community medicine. Systematic random sampling was used to achieve the minimum sample size. After explaining the objectives of the study to the participant and taking their informed consent, questionnaire was filled by interviewing one member of the HH, preferably the head of the family. The undergraduate students underwent trained in conducting on-field interviews and collected data under the supervision of field workers and faculty of the department of community medicine. The sample size was divided among rural and urban areas. However, only 179 HHs responded completely to the questions. To reach the minimum sample size, 195 HHs in urban areas were approached; however, complete responses were obtained by 193 only. Hence, a sample of 372 (head of HH as the respondent) were collected and analyzed.

A predesigned structured interview schedule was used for quantitative data collection. The schedule consisted of the following parts: demographic details of HH, utilization of health and medical services, and expenditure on some of the services. The information on visits to various health facilities was collected for the past 6 months. Expenses on all the visits both at the outpatient department (OPD) and inpatient department (IPD) were noted for the HH as described by the head of the HH. Expenses were also divided into direct and indirect health expenses. Indirect expenditure included the amount spent on transportation and loss of daily wages. Direct expenditure was majorly on doctor fees, laboratory fees, pharmacy fees, and hospitalization fees.

Statistical analysis

OOPE was calculated as the difference between total medical expenditure and reimbursement for treatment per hospitalization case during the past 6 months in case of delivery and hospitalizations. Further, the expenditure was converted as a proportion of income spent on health care in the past 6 months. The proportion was categorized into three groups: ≤20%, 20%–40%, and more than 40%. The quantitative data were entered into Microsoft Excel sheet and analyzed using Epi info version 7. The categorical variables are being presented using proportion, whereas scores and income are presented as mean.

The ethical clearance was obtained from the Institutional Ethical Committee for biomedical research (134/A/11/16/Academic/MC/2016/132) of ESIC Medical College and Hospital, Faridabad, Haryana.

  Results Top

The present study was conducted in the field practices area attached to the Department of Community Medicine and included 193 urban and 179 rural HHs. Majority of the HHs visited had 5–10 members, and in rural areas, few had a family size more than 10. Majority of rural HHs belonged to the upper (88.9%) and upper-middle classes (66.7%), whereas more than half of the urban participants were from lower and lower-middle classes [Table 1].
Table 1: Demographic profile of study population

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Total health insurance coverage among study participants was found to be 48.7% and was higher among urban (58.0%) [Figure 1].
Figure 1: Health insurance coverage in rural and urban areas

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The proportion of income spent as direct expenses on health (including OPD, IPD, laboratory, and pharmacy services) was observed to be more in rural as compared to urban. In rural setting, 79.9% of HH were spending up to 20% of their income on health as compared to 51.5% HH in urban. Contrary to this, when the study classified HH on the basis of health spending more than 20%, urban HH were found bit more affected than rural (17.8%, 14.8%). However, the proportion of income spent on indirect health expenses (including loss of wages and transportation) was lower among rural HH (82.1% spent up to 20% and 1.1% spent >20%) as compared to urban HH (93.0% spent up to 20% and 1.9% spent >20%) [Figure 2].
Figure 2: Direct and indirect expenses as a proportion of income in rural and urban areas

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In both rural and urban areas (21%, 22.2%), spending >20% of the income on health care was observed mostly among those HHs who did not avail any health insurance [Table 2].
Table 2: Out-of-pocket expenditure as a proportion of income among health insurance scheme utilizers

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Urban HH favored public hospitals (58%), public laboratories (61.3%), and pharmacies (55.0%). However, rural HH was mostly dependent on the private sector for health services, and this difference between the type of health services utilized in urban and rural areas was statistically significant [Table 3]. The utilization of health facilities for OPD services (51.8%), follow-up of chronic diseases (57.0%), and childbirth (51.9%) was more common among rural HH than urban (48.2%, 43.2%, and 48.1%) [Table 4].
Table 3: Health sector preference among the households

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Table 4: Health facility utilization by the households

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  Discussion Top

This study tries to measure OOPE on health care as a proportion of income. Around 47% of HH preferred the public sector (urban > rural) for health services in the current study. Most of the HH in rural areas were dependent on the private health sector for their health needs, and they were spending a substantiate proportion of their income on availing services such as OPD, hospitalization, and maternal and child health (MCH) from this sector. This is in line with the situation elsewhere in the country, where more than 80% of health spending is OOP.[7] The reason for the same may be that in spite of the launch of many rural health schemes by the government, the public sector remains underdeveloped and inadequacy in workforce and logistics at primary and secondary health centers pushes the common man toward the private sector in rural areas. A similar scenario was observed in a cohort study from Haryana; 19.9% reported a preference for the public sector. This study from Haryana by Ray et al. was unique in conducting a cohort study which accounted for all seasons expenditure on health to estimate the annual cost.[8] Contrastingly, Archana et al., in a similar study from rural Puducherry, reported that 70% of the population utilized the public sector for OPD visits and follow-up of chronic diseases in rural Puducherry. Further, nearly 69% of health-care utilization was for OPD visits and 50% for follow-up of chronic diseases, and it did not result in OOPE for health care. The presence of primary health centers providing free health care and tertiary care centers in the vicinity was the reason quoted by Archana et al.[6]

HHs from the urban area were enjoying public sector health services to a greater extent, and the proportion of income spent on health-care needs was less as compared to their rural counterparts. Urban HH in the current setting was mostly insured under a social security scheme, i.e., the Employees' State Insurance scheme, as majority of them were industrial workers.

In the present study, rural HHs were visiting health-care institutions mostly for follow-up of chronic diseases (57%), MCH (51.9%), and OPD (51.0%) services, whereas most of the urban HHs were availing of hospitalization services (58.1%), followed by routine health checkup (51.9%) and OPD (48.2%). A study done in Bengal in 2007 reported that the annual per HH expenditure was in the following decreasing order, i.e., hospitalizations, chronic diseases, and OPD visits. This study was conducted in three districts of the state using two-stage systematic random sampling, and models were framed to predict the probability of catastrophic health expenditure in HHs.[9]

The proportion of income spent as direct expenses on health (including OPD, IPD, laboratory, and pharmacy services) was more in rural areas as compared to urban. The expense of both hospitalized and nonhospitalized cases was lower in the study by Archana et al. due to the availability and accessibility of free health services in their region.[6]

Health insurance schemes are a means to achieve UHC. The health insurance coverage was higher among the sampled HH as compared to national estimates by the national sample survey 2017–2018.[3] The OOPE was lower among those HHs availing of health insurance schemes as compared to those who were not. Although indirect expenses are not covered under health insurance schemes, the findings need further exploration. Fan et al., in their study from Andhra Pradesh, evaluated the Aarogyasri Health Insurance Scheme using the difference in differences and reported a decline in OOP inpatient payments and catastrophic health expenditure among health insurance scheme users.[10] Contrary to this, Prinja et al., in their analysis of the effect of Rashtriya Swasthya Bima Yojana on OOP burden due to health-care payments reported that those enrolled had higher odds of facing catastrophic health expenditures.[11]

The study had limitations in the form of study design being an estimate of expenses incurred in the past. Hence, the recall bias of the head of HH was a major limitation. A longitudinal follow-up study would have provided an accurate estimate. Further, the current study included indirect expenses in calculating OOPE; however, not all indirect expenses can be accounted for. The category of HHs which did not seek health care could have been the ones who could not afford services. These problems were not probed into.

  Conclusion Top

The Health insurance coverage was 49% in study population; higher among urban as compared to the rural households. The rural population was spending more on health care services as compared to urban. HH which did not avail any health insurance spent more on health care (more than 20%).

Financial support and sponsorship


Conflicts of interest

There are no conflicts of interest.

  References Top

World Health Organization. Universal Health Coverage. Factsheet; 2019. Available from: https://www.who.int/news-room/fact-sheets/detail/universal-health-coverage-(uhc). [Last accessed on 2020 Jan 02].  Back to cited text no. 1
Government of India. Health in India. NSS 75th Round: July 2017–June 2018. Report No. 586. Ministry of Statistics and Programme Implementation, Government of India. National Statistical Office. New Delhi; 2020.  Back to cited text no. 2
Government of India. Ministry of Health and Family Welfare. National Health Policy 2017. New Delhi. Available from: https://www.nhp.gov.in/nhpfiles/national_health_policy_2017.pdf. [Last accessed on 2020 Jan 08].  Back to cited text no. 3
Pandey A, Ploubidis GB, Clarke L, Dandona L. Trends in catastrophic health expenditure in India: 1993 to 2014. Bull World Health Organ 2018;96:18-28.  Back to cited text no. 4
Shahrawat R, Rao KD. Insured yet vulnerable: Out-of-pocket payments and India's poor. Health Policy Plan 2012;27:213-21.  Back to cited text no. 5
Archana R, Kar SS, Premarajan K, Lakshminarayanan S. Out of pocket expenditure among the households of a rural area in Puducherry, South India. J Nat Sci Biol Med 2014;5:135-8.  Back to cited text no. 6
MOHFW. National Health Accounts India. New Delhi: National Health Accounts Cell, Ministry of Health and Family Welfare, Government of India; 2005.  Back to cited text no. 7
Ray TK, Pandav CS, Anand K, Kapoor SK, Dwivedi SN. Out-of-pocket expenditure on healthcare in a north Indian village. Natl Med J India 2002;15:257-60.  Back to cited text no. 8
Mondal S, Kanjilal B, Peters DH, Lucas H. Catastrophic out-of-pocket payment for health care and its impact on households: Experience from West Bengal, India. Future Health Systems: Innovations for equity. 2010. Available from: http://www.chronicpoverty.org/uploads/publication_fi les/mondal_et_al_health.pdf. [Last accessed on 2020 Jul 08].  Back to cited text no. 9
Fan VY, Karan A, Mahal A. State health insurance and out-of-pocket health expenditures in Andhra Pradesh, India. Int J Health Care Finance Econ 2012;12:189-215.  Back to cited text no. 10
Prinja S, Bahuguna P, Gupta I, Chowdhury S, Trivedi M. Role of insurance in determining utilization of healthcare and financial risk protection in India. PLoS One 2019;14:e0211793.  Back to cited text no. 11


  [Figure 1], [Figure 2]

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


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