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Introduction

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Paying Out-of-Pocket for Drugs, Diagnostics and Medical Services

Part of the book series: India Studies in Business and Economics ((ISBE))

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Abstract

For over past 60 years or even more, health has perhaps been among the few issues in India that has received unceasing attention from planners, policy makers, intellectuals and the political leadership. One of the earliest attempts in this direction was initiated years before the country gained independence from British rule in 1947. A committee—Health Survey and Development Committee—was constituted under the chairmanship of Sir Joseph Bhore as far back as 1943 to suggest measures for improvements in delivery of health care to a vast populace in the country, especially in rural areas. The network of primary and community health centres that exists now in most of the rural areas draws its origin from the recommendations of the Bhore Committee (1943–1946).

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Notes

  1. 1.

    For details of various other committees, see http://nihfw.org/NDC/DocumentationServices/Committe_and_commission.html.

  2. 2.

    A few of these Committees include Mudaliar Committee (1959–1961), Chadha Committee (1963), Mukherjee Committee (1966), Kartar Singh Committee (1975) and subsequently the first National Health Policy adopted by the Parliament in 1983 with a focus on health for all by 2000.

  3. 3.

    Ministry of Health and Family Welfare, Government of India, has been publishing since 2010 an ‘Annual Report to the People on Health’ with a view to provide:

    1. 1.

      Trends in core demographic parameters and recent developments in availability of various reproductive and child health services

    2. 2.

      Prevalence of selected communicable and non-communicable diseases

    3. 3.

      Public health-care interventions and achievements

    In all, the Ministry has published two reports highlighting improvements in several programmatic areas and health domains including improvements in key demographic parameters. There has also been a brief discussion in the reports about the paucity of certain health-care infrastructure, especially inadequate financial resources provided to health sector by the governments and shortages of medical and paramedical skills in the country. Discussing out-of-pocket expenditure on health, these reports have mentioned drugs and medicines as a single component causing most of health-care expenditure by households.

    The Ministry has started publishing this report annually on the advice of the President Mrs. Pratibha Patil at a joint session of parliament on 4 June 2009. As noted, the Ministry has so far published two reports, first in September 2010 and the second in December 2011. As usual, both the reports largely dealt with various programme inputs without going sufficiently into their outcomes.

    Like the people’s report by the Ministry of Health and Family Welfare, an Annual Health Survey (AHS) was also initiated by the Registrar General and Census Commissioner on the recommendation of the National Commission on Population, Planning Commission and the Prime Minister Office in 2010–2011 to provide information on core vital and reproductive health indicators from a group of demographically backward states including Uttarakhand, Rajasthan, Uttar Pradesh, Bihar, Assam, Jharkhand, Madhya Pradesh, Chhattisgarh and Orissa. The indicators covered in the survey are crude birth rate, crude death rate, infant mortality rate, neonatal mortality rate, under-five mortality rate, maternal mortality ratio, sex ratio at birth, sex ratio at 0–4 years old and sex ratio at all ages.

    None of these reports are however relevant for the analysis presented in the underlying study.

  4. 4.

    More prominent among these data sources with a cross-country coverage and large sample size are the three different rounds of the National Family Health Survey (NFHS – 1, 1992–1993; NFHS – 2, 1998–1999; and NFHS – 3, 2005–2006), and the District Levels Health Surveys (generally known as the RCH surveys) designed to assess various population parameters including utilisation of health services required during the pre and postnatal phases along with the nutritional details and immunisations of children against certain early life diseases. Much of these information and data sources however concentrate on programme variables without making explicit concerns about the outcome variables.

  5. 5.

    See National Population Policy (2000) and National Health Policy (2002).

  6. 6.

    For the most recent updates, see http://apps.who.int/nha/database.

  7. 7.

    RSBY, a brainchild of the Ministry of Labour and Employment (MoL&E), Government of India, does not cover more than fivemembers of a household nor does it cover expenses requiring nonhospitalised treatments of an ailing member in a household. The size restriction often leaves older members of a family/household uncovered.

  8. 8.

    Reportedly, households in India spend 50 % of their total health expenditure on drugs.

  9. 9.

    Many believe integration with the global pharmaceutical market will help in acquiring latest technology. It may however increase prices and hinder many from accessing a number of essential drugs, especially in a situation when over 75 % of the drugs in India are outside the price control regime.

  10. 10.

    See, for example, the Financing and Delivery of Health Care Services in India, National Commission on Macroeconomics and Health, Ministry of Health and Family Welfare, Government of India (August 2005).

  11. 11.

    Unlike the NSSO, the poverty estimates provided by the Ministry of Rural Development are based on total count data and therefore considered more reliable for application at district or subdistrict levels. There are however questions about the adequacy of the deprivation indicators used to decide poverty. Further changes in the list of poverty indicators and methodology are currently in progress.

  12. 12.

    Towns and villages were drawn on the basis of 2001 Census records.

  13. 13.

    The circular systematic sampling (CSS) method was suggested as part of the NSS instructions to field workers in 1952 and the NSSO has been using the CSS method since then. This method regards total (N) units of wards, villages or households as arranged around a circle, and consists in choosing a random start from 1 to N instead of from 1 to k, where k is the integral value nearest to N/n, where n is number of sample units. To illustrate, let N = 14, n = 5, and k (i.e. N/n) be taken as 3. If random start r (1 ≤ r ≤ 14) is 7, then the sample units with serial numbers 7, 10, 13, 2 and 5 are included. The CSS has two principle advantages: (1) It provides constant sample size; and (2) sample mean remains unbiased estimator of population mean (Murthy 1967). Diagrammatically, this method may be represented as below.

  14. 14.

    Around 16 % of the total population in urban Delhi was residing in slums as reported by the Census 2001 (Census of India 2001, Slum Population, Series – 1, Statement 1.1).

  15. 15.

    More or less the same geographical distribution was followed for Census purposes as well.

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Author information

Authors and Affiliations

  1. Institute of Economic Growth, Delhi University, Delhi, India

    Moneer Alam

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  1. Moneer Alam
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Appendix

Appendix

Table 1.A.1 Districts by size of BPL population: UP (rural), 2002 (%) used to decide study areas in UP
Full size table
Table 1.A.2 Share of BPL families by districts: a criterion used to decide study areas in Rajasthan (rural–urban combined), 2002
Full size table

Cut-off income to decide the BPL population

State

Rural

Urban

Delhi

410.38

612.91

UP

365.84

483.26

Rajasthan

374.57

559.63

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Alam, M. (2013). Introduction. In: Paying Out-of-Pocket for Drugs, Diagnostics and Medical Services. India Studies in Business and Economics. Springer, New Delhi. https://doi.org/10.1007/978-81-322-1281-2_1

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