Out-of-pocket spendings for healthcare push 61 lakh into poverty in 2022: BIDS

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Soaring out-of-pocket healthcare expenses pushed 61 lakh Bangladeshis, or 3.7% of the population, into poverty in 2022, according to a recent study by the Bangladesh Institute of Development Studies (BIDS).

The study also revealed that cancer patients bore the highest out-of-pocket costs, followed by Covid-19 patients. Significant expenses were also incurred by those with heart, kidney, liver, and mental health conditions.

Abdur Razzaque Sarker, a research fellow at the BIDS, presented the findings of the study titled "Catastrophic Health Shock and Impoverishment in Bangladesh: Insight from HIES 2022" during a seminar at the BIDS conference room yesterday. The BIDS conducted the study by analysing data from the 2022 Household Income and Expenditure Survey.

Prominent economists and Health Minister Samanta Lal Sen attended the event.

According to the BIDS study, a substantial portion of out-of-pocket spending across all patient categories goes towards purchasing medications. Outpatients allocate 54% of their total expenditure to medicines, while inpatients allocate 25%.

Citing the World Health Organisation's Global Health Expenditure database, Abdur Razzaque said out-of-pocket healthcare spending by Bangladeshis was under 56% in 1997. However, by 2021, it rose to 73%, making it the second highest in South Asia after Afghanistan.

However, in terms of overall health expenditure, Bangladesh's per capita spending was just $58 in 2021, the lowest in the region after Pakistan's $43, he said.

During the seminar, experts emphasised that the escalating financial burden of medical expenses is worsening social inequalities and increasing economic hardship among families.

This economic strain is often assessed through the metric of Catastrophic Health Expenditure.

The study explores the effects of out-of-pocket payments on Catastrophic Health Expenditure and poverty in Bangladesh, focusing on incidents of such expenditures, the impoverishment caused by out-of-pocket costs, and financial distress.

The study analysed data from more than 14,000 individuals to assess households' out-of-pocket (OOP) expenditures on treatments such as medication costs, consultation fees, diagnostics, transportation, lodging, and self-medication.

Dr Binayak Sen, director general of BIDS, noted that the research relied on model simulation rather than time-series data analysis. Therefore, the study's identification of the population falling below the poverty line may not accurately reflect actual declines.

He, however, said, "According to the research, we can infer that the increase in out-of-pocket expenditures poses a risk of pushing a certain portion of the population below the poverty line."

Out-of-pocket expenses dominated by cancer treatments

The study found that healthcare costs in 2022 were substantial with cancer patients incurring the most out-of-pocket expenses. Cancer patients incurred an average annual cost of Tk2,24,000, with some paying as much as Tk8,48,000. 

Covid-19 patients faced an average cost of Tk1,31,800, with a maximum of Tk6,40,000. Patients with heart, kidney, liver, and mental health conditions, along with pneumonia and jaundice, also reported significant expenses.

Pregnancy-related cases topped the list of patient numbers, followed by respiratory illnesses, diarrhoea, and eye problems.

Approximately 18% of households allocate more than 10% of their total expenditures for healthcare. Additionally, 9.46% of families allocate 40% of their non-food expenditures to healthcare, as per the study.

Abdur Razzaque said, "Around 61% of healthcare expenditures are covered through assistance from friends and relatives, often involving distress financing such as borrowing or selling assets. Around 15% of these households sold assets to cope with hospitalisation costs.

"The remaining 33% of expenses are covered from savings, with the remaining 6% sourced from regular income."

Binayak Sen raised concerns about the impact of out-of-pocket expenditures on inequality, stating, "We need to investigate whether our GINI coefficient [a statistical measure of economic inequality in a population] is changing due to these expenditures."

He also highlighted disparities in diagnostic costs across hospitals, including significant variations in prices for tests like blood tests, which he deemed unacceptable.

Binayak emphasised the need not only to increase healthcare sector allocations in the budget but also to address these issues comprehensively.

Govt plans national health insurance: Health minister

Addressing the seminar as chief guest, Health and Family Welfare Minister Samanta Lal Sen said, "Numerous countries around the world have adopted Universal Health Insurance, a system India implemented several years ago. We are now planning to introduce a similar health insurance programme.

"Over the past 48 hours, I visited several district and community hospitals in North Bengal. The extent of hardship faced by pregnant women in rural villages is profound and often unnoticed. Therefore, my immediate priority is to address these issues in the villages."

The minister said a significant portion of hospital patients suffer from hypertension and diabetes, which contribute to major heart and kidney diseases. "We need to reduce the prevalence of these conditions."

Regarding the health budget, he said, "There is a lack of efficiency in allocating health budget funds. Proper utilisation could significantly enhance service quality within this budget."

Referring to ongoing efforts on the National Health Protection Act, the minister said, "We have conducted at least seven meetings in the past six months to finalise the legislation. It is my goal to enact this law during my tenure."

He also addressed concerns about illegal pharmacies, urging the Directorate General of Drug Administration (DGDA) to take more proactive measures to combat them.