Comparing the average cost of outpatient care of public and for-profit private providers in India

Abstract

Introduction Understanding the cost of care associated with different kinds of healthcare providers is necessary for informing the policy debates in mixed health-systems like India’s. Existing studies reporting Out of Pocket Expenditure (OOPE) per episode of outpatient care in public and private providers in India do not provide a fair comparison because they have not taken into account the government subsidies received by public facilities. Public and private health insurance in India do not cover outpatient care and for-profit providers have to meet all their costs out of the payments they take from patients. Methods The average direct cost per acute episode of outpatient care was compared for public providers, for-profit formal providers and informal private providers in Chhattisgarh state of India. For public facilities, government subsidies for various inputs were taken into account. Resources used were apportioned using Activity Based Costing. Land provided free to public facilities was counted at market prices. The study used two datasets: a) household survey on outpatient utilisation and OOPE b) facility survey of public providers to find the input costs borne by government per outpatient-episode. Results The average cost per episode of outpatient care was Indian Rupees (INR) 400 for public providers, INR 586 for informal private providers and INR 2643 for formal for-profit providers and they managed 39.3, 37.9 and 22.9% of episodes respectively. The average cost for government and households put together was greater for using formal for-profit providers than the public providers. The disease profile of care handled by different types of providers was similar. Volume of patients and human-resources were key cost drivers in public facilities. Close to community providers involved less cost than others. Conclusions and recommendations The findings have implications for the desired mix of public and private providers in India’s health-system. Poor regulation of for-profit providers was an important structural cost driver. Purchasing outpatient care from private providers may not reduce average cost. Policies to strengthen public provisioning of curative primary care close to communities can help in reducing cost.

Reiterating the Importance of Publicly Funded and Provided Primary Healthcare for Non-communicable Diseases: The Case of India Comment on "Universal Health Coverage for Non-communicable Diseases and Health Equity: Lessons From Australian Primary Healthcare"

“…5 High out-of-pocket expenditure, especially on medicines and ambulatory care, pose a burden on households, with the poor facing further impoverishment due to healthcare costs. 7,8 Health and Wellness Centres in India: Structures for Implementation India initiated reforms in its PHC programme as part of the mandate provided by the National Health Policy (2017) to strengthen PHC systems and invest at least two-thirds of government health spending on it. 6 After initial pilots, health and wellness centres (HWCs) were inaugurated in February 2018, with the objective to deliver "universal, free comprehensive PHC" through transforming existing health centres (sub-health centres [SHCs] and primary health centres) (p. 18).…”

Household expenditure on non-Covid hospitalisation care during the Covid-19 pandemic and the role of financial protection policies in India

“…Chhattisgarh’s population had nearly universal coverage under PFHI schemes that include the Ayushman-Bharat Pradhan Mantri Jan Arogaya Yojana (PMJAY), the national flagship scheme [ 23 , 28 ]. Both private and public hospitals were empanelled to provide services.…”

“…The schemes included ‘cash-less’ i.e. free hospital-care for 1370 medical conditions and procedures covering all medical expenses [ 20 , 23 ].…”

“…Thresholds of 10% and 25% of concerned household’s Annual Consumption Expenditure were taken for CHE and named CHE10 and CHE25 respectively. Recent studies in India have used the same procedure for calculating Annual Household Consumption Expenditure [ 23 , 42 ].…”

“…Maternal care in public hospitals is completely exempt from any user fees. There is a free essential drug policy in most Indian states which mandates that patients using public facilities receive the prescribed drugs free of cost [ 23 ].…”