Role of publicly funded health insurance in financial protection of the elderly from hospitalisation expenditure in India-findings from the longitudinal aging study.

Background: The elderly face a greater burden of illnesses than other age groups and have a more frequent need of healthcare, including in-patient hospitalisations. Catastrophic expenditure on hospitalisation of the elderly poses a significant challenge to India's aim of achieving Universal Health Coverage (UHC). India has implemented a policy of Publicly Funded Health Insurance (PFHI) to provide free inpatient care by empanelling private and public hospitals. The existing studies have examined the performance of PFHI in financial protection of the elderly.

Methods: This study utilised the Longitudinal Ageing Study in India (LASI) Wave 1, conducted in 2017-18. LASI is a large-scale nationally representative survey collecting data on elderly health including illness burden, healthcare use and out of pocket expenditure (OOPE). It covered a sample 72,250 individuals aged 45 or above. Financial Protection was measured in terms of Catastrophic Health Expenditure (CHE). Multivariate analysis was conducted to find effect of PFHI on OOPE-quantile and logistic models were applied for OOPE and CHE respectively. For robustness, Propensity Score Matching (PSM) model was applied.

Results: Of the hospitalisations, 35% had taken place in public hospitals. The mean OOPE for a hospitalisation in public sector was Indian Rupees (INR) 8276, whereas it was INR 49,700 in private facilities. Incidence of CHE was several times greater for using private hospitals as compared to public hospitals. Multi-variate analyses showed that enrolment under PFHI was not associated with lower OOPE or CHE. PSM model also confirmed that PFHI-enrolment had no effect on OOPE or CHE. Use of private facilities was a key determinant of OOPE, irrespective of enrolment under PFHI.

Conclusions: This was the first study in India to examine the performance of PFHI in the context of catastrophic hospitalisation expenditure faced by the elderly. It found that PFHI was not effective in financial protection of the elderly. The ongoing reliance on a poorly regulated private sector seems to be a key limitation of PFHI policy. Governments need to find more effective ways of protecting the elderly from catastrophic health expenditure if the goal of UHC has to be realized.