Economic Impact of Ill Health On HouseholdBy –
Dr. Varsha Devlekar
Dr. kavitha Gangam
PRESENTATION OUTLINE
• Ill-health
• What are the direct and indirect costs of illness to households ?
• How do households manage or cope with illness costs ?
• What is the impact of illness costs and coping strategies on household assets , incomes flow and processes of impoverishment ?
• Is there evidence to suggest that health service characteristics exacerbate or mitigate illness costs for poor households ?
“ if main earner of family falls ill then how does it affects the
financial status of that family”
‘‘HEALTH IS A STATE OF COMPLETE PHYSICAL, MENTAL AND SOCIAL WELL BEING AND NOT MERELY ABSENCE
OF DISEASE OR INFIRMITY’’
“ ILL-HEALTH AND POVERTY GOES HAND IN HAND”
It is quite simple that poor are sicker than non poor and this is true in both
rich and poor countries.
ILLNESS
Physiological
Psychological
Social
Acute
Chronic
Psychological Illness
Stress
Depression
Anxiety neurosis
Dementia
Schizophrenia
Personality disorder
How does psychological illness threatens
household economy ?
Sick more leaves
Work accidents
Medical and legal issues
Inability to take proper financial decisions
Amount spent on alcohol , tobacco, drugs etc.
exceeds income
Increase in Chances of physiological illness
PHYSIOLOGICAL ILLNESS
Burning health
problems in
India
Diabetes
CVD
Hypertension
Nuritional
Anaemia
Cataract
Malaria
Dengue
Leprosy T.B.
7 %
%15%16
%51
87 %
%7573 %
40 %
6 %
%10%119 %
0
10
20
30
40
50
60
70
80
90
100
Low Income Lower - Middle
Income
Upper Middle
Income
High Income
Communicable,
maternal,
perinatanal and
Nutritional
conditions
Chronic or non
commuincable
diseases
Injuries
Worldwide share of deaths by causes and World Bank Income Category 2002
Disease Household Cost in INR
• tuberculosis 3500
• Malaria 5000
• AIDS/HIV 50,000
• Cataract 1207
• Leprosy 1,13,000
• COPD 33,000
Annual Income Losses to Households Affected by NCDs in India, 2004 (Mahal et al. 2010)
Based on data from the 60th round (2004) of the National Sample Survey Organization that surveyed
nearly 80 thousand households on health care utilization, expenditure and other information;
combined with mortality data from the Medical Certification of Causes of Death
(MCCD) of the Registrar General of India and the Burden of Disease statistics of the WHO
Economic Burden on household for
poor people is spending more than
10% of total income on health issues
Mean household health expenditure over the wholesample studies done by Mr Steven Russell from School ofDevelopment Studies, United Kingdom is 7.1% .
But 19.4 % for the poorest and 3.9% for richest
3.9% 19.4%
Access, services, quality
insurance
Admission in hospital
Direct and indirect cost
Pre-existing savings
Social networkingAffects lifestyle
Selling assets
HOW DOES THE ECONOMY GET AFFECTED?
1. Direct cost-
• Hospital payments
• Medicines
• Investigations
• Travelling expenses
• Post hospitalization care
2. Indirect cost-
• Cut down in salary
• Prolonged leave
• Decrease in work efficiency
• Unemployment etc.
How to Reduce the Impact Of Ill-health on
Household??
• Assessment of health status and health problems is the 1st requisite for
any planned economy , so the government should provide certain
healthcare policies like health insurance, Medical loans
• Building private and public healthcare partnership
• Providing health education
• Improving the number and qualitative health service in Gov. , semi Gov.
hospitals
• Reducing the custom tax over the imported equipments , drugs.
Health contributes to individual utility or social welfare in three ways.
1. People prefer to be more healthy than less
healthy (i.e. health directly affects utility). In
economic terms, it is an argument in the utility or
social welfare function.
e.g. diet, yoga, gym
2. The enjoyment of consumption of other goods and
services is partly influenced by the level of health (i.e.
marginal utility derived from consumption is partly a function
of health status).
Poverty/ low income
Small size of the market
Low investment
Lack of capital
Low productivity
3. Without good health other economic objectives,
such as producing income that allows people to
consume market goods, stand to be compromised;
in other words, it is instrumental to an individual's or
community's capability to undertake desired
activities or functions
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