WHO Survey: Expense on Healthcare to push 3.2 per cent Indians below the Poverty Line

According to a survey by the Indian Institute of Population Sciences and WHO published on 1 November 2011, out-of-pocket (OOP) spending of their income on medicines and health care services will push millions of Indians (about 3.2 per cent) below the poverty line. Rising cost of diagnosis, medicines and hospitalisation will be responsible for the out-of-pocket spending.

Statistics:

More than 40 per cent of low-income families in India borrowed money from outside the family to meet their health care costs. The study found that 16 percent families were pushed below the poverty line by this trend.
A majority of Indians spend around 70 per cent of their income on medicines and health care, compared to 30-40 per cent in other Asian countries like Sri Lanka.

The WHO stressed the need for effective monitoring system in India, while expressing concern about the lack of Drugs and Therapeutics Committee (DTC) and Pharmacy and Therapeutics Committee (PTC) in Indian hospitals.

What the Planning Commission said
The Planning Commission accepted that OOP to pay for healthcare costs was a growing problem in India. It mentioned that 39 million Indians were pushed to poverty because of ill health every year. According to the Planning Commission, around 30% in rural India didn't go for any treatment for financial constraints in 2004. In urban areas, 20% of ailments were untreated for financial problems in 2004. About 47% and 31% of hospital admissions in rural and urban India, respectively, were financed by loans and sale of assets.
The Planning Commission's high-power expert group on universal health coverage recommended ensuring availability of free essential medicines by increasing public spending on drug procurement. The expert group mentioned in its report that low public spending on drugs and non-availability of free medicines in government healthcare facilities were major factors discouraging people from accessing public sector health units.

State-wise Analysis
Maharashtra spent 5.2% of its health expenditure in 2010 on purchasing drugs as against 11.3% a decade ago. Rajasthan, Haryana, Karnataka and Madhya Pradesh too followed suit during the same period.

Though Kerala spent the highest in India on drug procurement in 2010 -12.5% on health expenditure, the figure is still far less than what it had in 2001 (17%). Tamil Nadu's expenses on buying medicines came down from 15.3% (2001) to 12.2% (2010).

Data from 2010-11 indicated that about 10%-12% of the health spending in the states of Tamil Nadu and Kerala went towards procuring drugs as against the 2%-3% spent on drugs by states like Jharkhand, Punjab and Rajasthan. While there has been a significant improvement in drug procurement in the state of Bihar as a result of increased allocation of NRHM funds, it is still spending a very little (Rs 8 per capita) on drugs.