Health Care Still a Costly Affair: Covariates of Out-of-Pocket Expenditure on Health Care in India with Special Reference to Empowered Action Group States

Abstract

This article investigates the covariates of out-of-pocket expenditure (OOPE) on health care, with a special focus on the Empowered Action Group (EAG) states of India. These states are economically weaker and vulnerable. For analysis, the study uses a nationally representative database—the India Human Development Survey (IHDS I, 2004–2005 and IHDS II, 2011–2012)—by applying the log-linear regression method. Four regression models have been specified in the article. The pooled regression method is applied to check the robustness of the models. Results identify that factors such as the location of the respondent, education, waiting time in hospitals, household expenditure per capita and the location of the hospital play a significant role in determining the OOPE on health care in India. Among other factors, waiting time in the hospital and the distant treatment location result in higher opportunity costs for better treatment facilities, hence increasing the burden on OOPE. The study concludes with suggestions based on these covariates, especially for the EAG states.