Estimation of out of pocket direct and indirect medical expenditure and spending burden ratio across income quintiles in urban Lucknow, India

BackgroundHealth insurance in India is almost non-existent. Therefore all expenses incurred during illnesses are borne directly by the family and accurate estimates are not available. The primary objective of the study was to assess the proportion of households who incur out of pocket medical expenditure due to sickness of family members in an urban area in India. Secondary objectives were to quantify the direct and indirect medical expenditure incurred by families in the last 3 months and to assess the spending burden ratio (ratio of total medical expenditure to family income) among income quintiles.MethodsThis was a community based cross sectional study conducted in randomly selected administrative wards in Lucknow city, northern India.ResultsFrom December 2011 to March 2012, 400 families, having 2343 members were recruited from 16 wards. Mean family size was 5.86 members (SD = 2.13 members) and mean family income was INR 9622.25 (SD = 11,323.01) (US $1 = INR 50 approximately in mid-2012). In last 3 months, 115 households (28.75 percent) sought medical care for illness in one or more family members. Mean direct medical expenditure was INR 3406 (SD = 4657), mean indirect medical expenditure was INR 1449 (SD = 2685) and mean total medical expenditure was INR 6590 (SD = 13,333). The spending burden ratio in the lowest and highest income quintile was 0.57 ± 0.82 and 0.15 ± 0.30 respectively (p value = 0.024).ConclusionsSince more than one-fourth of households incur medical expenditure which are paid out of pocket from family income, and since the spending burden ratio is statistically significantly higher in the lowest income quintile when compared to highest, there is a need for introduction of health insurance of some sort for the urban population. This is especially needed for the poorer sections, with provision to absorb the indirect medical expenses if possible.