Utilisation and financial protection for hospital care under publicly funded health insurance in three states in Southern India

Abstract

BackgroundMany LMICs have implemented Publicly Funded Health Insurance (PFHI) programmes to improve access and financial protection. The national PFHI scheme implemented in India for a decade has been recently modified and expanded to cover free hospital care for 500 million persons. Since increase in annual cover amount is one of the main design modifications in the new programme, the relevant policy question is whether such design change can improve financial protection for hospital care. An evaluation of state-specific PFHI programmes with vertical cover larger than RSBY can help answer this question.Three states in Southern India - Andhra Pradesh, Karnataka and Tamil Nadu have been pioneers in implementing PFHI with a large insurance cover.MethodsThe current study was meant to evaluate the PFHI in above three states in improving utilisation of hospital services and financial protection against expenses of hospitalization. Two cross-sections from National Sample Survey’s health rounds, the 60th round done in 2004 and the 71st round done in 2014 were analysed. Instrumental Variable method was applied to address endogeneity or the selection problem in insurance.ResultsEnrollment under PFHI was not associated with increase in utilisation of hospital care in the three states. Private hospitals dominated the empanelment of facilities under PFHI as well as utilisation. Out of Pocket Expenditure and incidence of Catastrophic Health Expenditure did not decrease with enrollment under PFHI in the three states. The size of Out of Pocket Expenditure was significantly greater for utilisation in private sector, irrespective of insurance enrollment.ConclusionPFHI in the three states used substantially larger vertical cover than national scheme in 2014. The three states are known for their good governance. Yet, the PFHI programmes in all three states failed in fulfilling their fundamental purpose. Increasing vertical cover of PFHI and using either ‘Trusts’ or Insurance-companies as purchasers may not give desired results in absence of adequate regulation. The study raises doubts regarding effectiveness of contracting under PFHIs to influence provider-behavior in the Indian context. Further research is required to find solutions for addressing gaps that contribute to poor financial outcomes for patients under PFHI.

Performance of India’s national publicly funded health insurance scheme, Pradhan Mantri Jan Arogaya Yojana (PMJAY), in improving access and financial protection for hospital care: findings from household surveys in Chhattisgarh state

“…The size of OOPE and incidence of CHE in the current study was several times higher for privatesector hospitalizations irrespective of enrollment under PFHI, as found in earlier studies in India [16,19,26]. The likelihood of insurance benefit being appropriated by powerful providers has been a longstanding problem in LMIC contexts [51].…”

“…'Double billing' in the context of PFHI has been referred to the situation when hospitals, while claiming the amount for a service from insurance side, also charged illegal copayments from patients for the same service or asked them to buy drugs, diagnostics and consumables from outside [24][25][26].…”

“…Tendencies to charge extra from the patients, despite PFHI cover have been reported from several states of India [24][25][26]. Studies have recommended that stronger supervision by state authorities, better mechanisms for addressing grievances and a 24-hour helpline should be implemented to address the problem of 'double-billing' [15,16,24].…”

“…There is a growing recognition that governance and control needs to be strong for purchasing to be successful in LMICs [53,54]. The relative size of OOPE in private and public sector hospitals, suggests that the share of the public sector could be increased in provisioning to bring down overall OOPE [26]. Further research is recommended on experiences of publicly funded schemes in LMICs that rely on contracting for-profit providers.…”

“…Private providers accounted for around 85% of the claim amount under PMJAY, as was the case under RSBY in Chhattisgarh [33]. The above feature is a continuation of pattern prevalent under earlier PFHI schemes in Chhattisgarh and most states in India [26].…”