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 Table of Contents  
Year : 2017  |  Volume : 4  |  Issue : 1  |  Page : 42-47

Catastrophic health expenditure among geriatric population of Lucknow district, India

1 Programme Officer, Jhpiego, Lucknow, Uttar Pradesh, India
2 Department of Community Medicine and Public Health, King George's Medical University, Lucknow, Uttar Pradesh, India

Date of Web Publication20-Jun-2017

Correspondence Address:
Pavan Pandey
E-33 Surya Apartments Model Town, Nehru Nagar, Bhilai, Durg - 490 020, Chhattisgarh
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Source of Support: None, Conflict of Interest: None

DOI: 10.4103/jgmh.jgmh_40_16

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Background: Health system that is chiefly financed by out of pocket expenditure can have varying impact on patients belonging to different income groups. The main objective of the present study was to assess the health-care utilization pattern and socioeconomic features of elderly who incurred catastrophic health expenditure. Materials and Methods: A community-based cross-sectional study was conducted employing multi-stage sampling technique to collect data from a total of 404 elderly residing in Lucknow district. Data were collected on health care utilization and related health care expenditure with by the means of a questionnaire. Results: Out of 404 elderly, 15.8% incurred catastrophic expenditure. Among all the study participants, 33.1% who sought in-patient care and 13.8% who sought exclusive out-patient care incurred catastrophic health expenditure. Conclusion: Proportion of those facing catastrophic expenditure was high among lower income group. Thus, patients who lie at the bottom of income pyramid need higher protection as compared to those who are at the top.

Keywords: Catastrophic, elderly, India, out of pocket expenditure

How to cite this article:
Pandey P, Singh SK. Catastrophic health expenditure among geriatric population of Lucknow district, India. J Geriatr Ment Health 2017;4:42-7

How to cite this URL:
Pandey P, Singh SK. Catastrophic health expenditure among geriatric population of Lucknow district, India. J Geriatr Ment Health [serial online] 2017 [cited 2023 Jun 4];4:42-7. Available from:

  Introduction Top

The only function of the health system is to keep masses healthy. It does so via providing a range of services which are categorized as promotive, preventive, curative, rehabilitative, and palliative services. However, the relationship between sickness, health system access, health care utilization, and health care expenditure is very complex.[1],[2],[3] Financing model of the health system and the paying capacity of citizens determines who all can access health system and up to what extent.[3],[4] Accessing health services can cause some families/households to spend higher proportions of their total income on health and sometimes such expenditure can be catastrophic, or can even push families/households into poverty while for other families health care expenditure may not have any significant impact on family's overall economic status.[5] Hence such unwanted adverse outcome among patients should be kept in mind while designing health systems and adopting a particular type of health care financing model.[6]

India has one of its kinds of the health system in the world. On the one hand, India has an extensive network of government-funded hospitals which provide uneven health services of varying quality to citizens of India. At the same time, India also has state of art private hospitals which cater patient for medical tourism from developed countries.[7] Financing model for India's health system has failed miserably in reducing the burden of out of pocket expenditure, distressed financing, and impoverishment among its users.[8],[9],[10] This is because the current model of health system financing in India lacks financial risk pooling thus burden of payment for health services ultimately transfers on patients some of whom have low paying capacity.[8],[9],[10] This is evident from the data reported in national health accounts (2004–2005) which revealed that of the total health expenditure in the country, contributions from households in the form of out of pocket expenditure was 71.09%.[11] This fact was further supported by the WHO report which states that in Southeast Asia region, the out of pocket expenditure on health was third highest in India, next to Myanmar and Bangladesh, even countries such as Nepal, Sri Lanka, Bhutan, and Pakistan outperformed India.[12]

Individuals in the geriatrics age group are characterized by increased incidence of both communicable and noncommunicable diseases due to a gradual decline in physical, immunological and mental capacity.[13],[14],[15] This increased burden of morbidities directly results in increased health care needs and increased health system access by individuals thus resulting in health care expenditure. As explained above this health care expenditure can have varying impact on its users. Therefore, we conducted the present study with the objective to determine the biosocial characteristic and health care utilization pattern of elderly living in Lucknow district that incurred catastrophic health expenditure.

  Materials and Methods Top

Study setting

The present study is a part of master's degree dissertation to study the interaction of the elderly person with the Indian health system.[16]

Study design and location

This was a community-based cross-sectional study conducted at Lucknow district, capital of the state of Uttar Pradesh, the most populous state in India.

Study duration

The total duration of the study was 1 year.

Study participants

Person 60 years and older (definition of elderly by the government of India).[17]

Source population

Elderly residing in the urban and rural parts of Lucknow district.

Inclusion criteria

(i) Elderly able to answer the questions of interview (ii) elderly who gave oral informed consent for the study.

Exclusion criteria

(i) Uncooperative elderly (ii) elderly person who cannot answer the questions of interview (iii) elderly who did not consent for the study.

Sample size

Assuming that 50% of the households which has at least one elderly who made a health care out of pocket expenditure within last 6 months.[18] Applying to this estimate a confidence level of 95%, precision level of 5%, and a nonresponse rate of 10%, a sample size of 404 was calculated.

Sampling technique

As per Sample Registration System – 2012, the proportion of elderly residing in urban and rural parts of Uttar Pradesh was about 49.0% and 51.0%, respectively.[19] Thus, we collected 198 (49%) study subject from urban and 206 study subject (51%) from the rural part of Lucknow district. The study employed multi-stage sampling strategy using the polling booth wise list of eligible voters (>18 years of age) registered with election commission of India in Lucknow district.[20] The detailed sampling methodology has been described elsewhere.[21] To cover the requisites sample of 404 we approached a total of 463 elderly.

Data collection

The schedule 60_25.0 utilized by National Sample Survey Organization for their survey titled “Morbidity and Health Care” was reviewed in detail.[22] A questionnaire was then prepared and later it was mailed to experts in the field of geriatrics care and assessing health care expenditure. Suggestions and rectifications were included in the final version of the questionnaire. The questionnaire was then translated from English into Hindi (native language). The questionnaire was pilot-tested on a sample of 30 elderly, results of pilot-test were excluded from final analysis. The study questionnaire had four components (i) sociodemographic (ii) health status of elderly (iii) household income and expenditure and (iv) health care utilization, health care expenditure and source of financing. Questions were asked about illnesses episodes and whether the sick elderly availed health care or eschewed it. Total health care expenditure consisted of following three components: (i) Expenditure related to self-medication during the past 1 month (ii) out-patient care expenditure for past 3 months and (iii) in-patients care health expenditure for the past 6 months. For treated illness episodes, data were amassed on expenditures incurred as (i) direct medical expenditures, such as doctor's fees, medicines, investigations, procedures/surgery, hospital charges (ii) indirect medical expenditures such as transport, expenditure on escort and food during the period of stay. All expenditures were calculated in Indian National Rupee (the currency of India). Total medical expenditure was computed by summing direct as well as the indirect medical cost. All forms of health care expenditures weather of modern medicine, dental, physiotherapy, Ayurveda, traditional healers and buying medical aid were included to estimate total healthcare out of pocket expenditure. When the source of financing was insurance, the net amount paid by the insurance company was deducted to calculate net out of pocket expenditure made by elderly.

Catastrophic health expenditure

We for the purpose of this study had considered that a person/family spending 10.0% or more of the total family income on health as out of pocket expenditure is considered to have incurred catastrophic health expenditure.[3],[23]

Distressed financing/financial hardship

We for the purpose of study has considered that any amount of money that has to be returned either with interest or without and money obtained as a result of the sale of assets constitute as distressed financing/financial hardship.[24],[25] This study was approved by King George Medical University's ethical committee for research on humans.

  Results Top

Following the cut-off value of 10.0% of total family income as a threshold for catastrophic health expenditure [Table 1] shows that of the total 404 subjects, 64 (15.8%) faced catastrophic health expenditure. Proportionally a higher fraction 28.2% (11/39) of those elderly aged 80 years and above faced catastrophic expenditure as compared to 14.03% (32/228) of those between 60 and 70 years of age.
Table 1: Total health expenditure as percent of total family income and biosocial characteristic of elderly (n=404)

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[Table 2] shows the health care utilization pattern of the elderly subjects and the incidence of catastrophic expenditure. Of the total 404 elderly, 133 elderly used in-patient care and had a total of 165 episodes of hospitalization during the study period. As shown in [Table 3], the incidence of catastrophic expenditure increased with duration and number of hospitalization. Those utilizing in-patient care for emergency care were at higher risk of incurring catastrophic health expenditure as compared to elective one. The incidence of catastrophic expenditure was similar whether patients required medical or surgical care during hospitalization. But the degree of overshoot from the threshold for catastrophic threshold was higher for those needing surgical care (not shown in table).
Table 2: Type of healthcare utilization and incidence of catastrophic expenditure

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Table 3: Incidence of catastrophic expenditure and in-patient care availed during last 6 months

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Of all study participants, 145 elderly used exclusive out-patient care and made a total of 254 visits to the hospitals/physicians. As detailed in [Table 4], 7.9% of elderly who used exclusive out-patient care incurred catastrophic health expenditure. Of the 30 elderly subjects who sought care for both acute and chronic diseases, 6 (20.0%) incurred catastrophic health expenditure, showing the double burden of both morbidities and health expenditure in geriatrics age group patients. Perhaps the most important findings of our study are presented in [Table 5] which details the incidence of catastrophic expenditure, distressed financing and deferring healthcare need due to lack of money. As can be seen, a higher proportion of those from low-income quintile and low per capita income faced catastrophic expenditure and deferred health care needs. Furthermore, the incidence of distressed financing was high among elderly who lies at the bottom of income table.
Table 4: Exclusive out-patient care availed during the last 3 months and incidence of catastrophic expenditure

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Table 5: Economic status of elderly and incidence of distressed financing and catastrophic health expenditure

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  Discussion Top

In our study, we observed that 15.84% of study participants incurred catastrophic health expenditure and 16.83% of study participants used the distressed financing to pay for health care needs. Of total study participants who used in-patient care and exclusive out-patient care, 33.1% and 13.8% incurred catastrophic health expenditure, respectively. In our study, a higher proportion of those belonging to low-income quartile faced catastrophic health expenditure. More than half (%) of those who were in lowest income quartile avoided health care need due to a shortage of money.

As discussed earlier Indian health system is chiefly financed by out of pocket expenses because of which many of its users have adverse outcome. First, it can impoverish those households who are made to pay more than their earning capacity and second such health system will not serve those who are unable to pay for health care services. Thus, rising costs of health care and inadequate insurance coverage will ensure that more and more patients will incur catastrophic health expenditure. Thus due to health care utilization such patients will either become impoverished or remain entrapped in poverty. In our study, we observed that out of 404 elderly, 15.84% incurred catastrophic health expenditure and 16.83% used the distressed financing to pay for health care needs. Ghosh showed that in India about 35 million people in 1993–1994 and 47 million people in 2004–2005 were pushed into poverty due to health care out of pocket expenditure.[26] The current model of health system financing will make it more difficult for India to achieve the Millennium Development Goal of halving the number of poor.[27]

Health care utilization and catastrophic expenditure

In our study, higher proportion of those utilizing inpatient care (33.1%) than those utilizing only out-patient care (13.8%) faced catastrophic health expenditure. Social insurance in India at present covers only inpatient care and that too up to a certain amount of expenditure.[4],[10] Thus in our opinion, if the government wishes to make social insurance more effective, then it must increase both its scope as well as limits.

Per capita income and catastrophic health expenditure

Excess out-of-pocket payments are however not the only reason for incurring catastrophic payments. A host of other factors such as the type of health service accessed, per capita income, nature of the illness, and the lack of insurance also contribute towards incurring catastrophic expenditure and impoverishment. In our study, catastrophic health payment was seen across all income groups. However, a higher proportion of those having low per capita income faced catastrophic expenditure, used distressed health care financing and deferred health care needs. We noted that incidence of catastrophic payments were almost 100.0% when three factors: Low per capita income, multiple illnesses and using private healthcare for in-patient care were present simultaneously. Hence, it is likely that high rates of catastrophic spending will be seen among all such families irrespective of the family member (elderly, infant, children, or adult) who access health care.[28]

Even though catastrophic spending is not a new problem, but increasing proportion of person incurring and the extent of overshooting the 10.0% threshold margin is definitely a new problem to worry about. During the last couple of decades, the proportion of private hospital in India has grown at a faster rate than the increase in both the paying capacity of citizens and rise in social insurance coverage.[4],[7],[10] Furthermore, the government spending on health system has remained same during this period resulting in increased the burden of the health care expenditure, especially among lower income families.[29],[30] The problem of catastrophic health payments will not be solved alone by increasing the share of government expenditure on health or by increasing the income of the citizens; rather, it will be solved through a properly structured social insurance program which effectively pool financial risk and provides more financial protection for those who are most vulnerable.[30] Thus, “equity” should be one of the core principles in mind while adopting a health financing model.[5]

Low income, lack of insurance and health compromise

The impact of out-of-pocket payments cannot be fully captured by examining incidence catastrophic spending alone; we also need to measure the incidence of distressed financing, proportion of patients deferring health care need due to inability to pay and important needs compromised by families while paying for health care.[31],[32] Patients from poor families will choose to not seek health care rather than being pushed deeper into poverty. This can especially be true in case the spending has to be made for patients in the geriatric age group who are not the earning member of family.[31],[32] In our study, the incidence of distressed financing was high (60.4%) among elderly who were at the bottom of per capita income table as compared to elderly at the top of per capita income (2.3%). Also, the proportion of those who deferred one or more health care needs due to the lack of money was highest among lowest income quintile elderly (64.2%) while none of the highest income elderly deferred any health care due to monetary reasons. These observations are sufficient to argue that health systems should be financed through prepayment mechanisms such as social insurance and general taxation rather than through user-fees.

The present study can be replicated in any part of India as the list of elderly people is available for each and every polling station/booth of the country. Studies such as ours can also be carried out on different age group and for different health care needs. Results generated from all such studies when pooled together can give a better idea about which all the individual are facing catastrophic health expenditure and for what services so that a better social security program can be devised.


Only those elderly whose name was in the voter list had the chance of being enrolled in the study. Because of recall bias, there were chances of both underreporting and overreporting of the incurred expenditure, but we minimized it by verifying the amount of health care spending by the means of bills and prescription slips available with the elderly.

Future research

In the present study, we did not assessed the impact of illness and related expenditure on the future course of life of patients and their families. We, therefore, recommend that researchers in future should study the impact of catastrophic health expenditure on the future of elderly and what other needs families avoided/sacrificed as a result of catastrophic expenditure.

  Conclusion Top

Working age group person can compensate for excessive expenditure but elderly, many of whom are dependent on others for financial support or have limited income in the form of pension cannot bear the burden of catastrophic payment. The proportion of the elderly population in India is gradually increasing, and thus the government should devise proper social security scheme for elderly keeping in mind their health care needs. Increasing public health expenditure is a forgotten promise and despite many committees and commission recommending an increase in public health spending the government is yet to act. Present social insurance program has to be re-designed to increase the services it covers, amount it offers. The coverage of social insurance program should be increased to cover all the families in the low- and middle-income group because catastrophic health expenditure and distressed financing are not limited to the poor's alone.


Authors are sincerely thankful to Prof. Uday Mohan and Dr. Moneer Alam for their guidance and motivation that they provided in going forward and consummating this work. Our sincere thanks to all the elderly participants who had patience to sit and heedfully discern all our questions and queries and answering them to the best of their cognizance.

Financial support and sponsorship


Conflicts of interest

There are no conflicts of interest.

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  [Table 1], [Table 2], [Table 3], [Table 4], [Table 5]

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