Total Cost Per Hospitalization in Private Hospitals Rs 3,955 Higher Than Public Hospitals in India: IIT Jodhpur Study

Government and households put together spent substantially more per hospitalisation in private hospitals than public hospitals, as per a recent survey by the Indian Institute of Technology (IIT) Jodhpur. The average total spending per day of hospitalisation in India was found to be Rs 2,833 for public hospitals and Rs 6,788 for private hospitals.

The researcher gave a comparative study on how much do government and households spend on an episode of hospitalisation during their visit to public and private healthcare facilities in India. The results of this research were published in Health Economics Review Journal which is an international peer reviewed journal.

For a valid comparison between public and for-profit private providers, this study assessed the combined spending by government and households per episode of hospitalisation. The supply-side and demand-side spending from public and private sources was taken into account. The study used two datasets — household survey for data on hospital utilisation, OOPE, cash incentives received by patients and claims raised under publicly funded health insurance (PFHI) schemes survey of public facilities.

“Overall, supply-side public spending contributed to 16 per cent of total spending, demand-side spending through PFHI to 16 per cent, cash incentives to 1 per cent and OOPE to 67 per cent. OOPE constituted 31 per cent of total spending per episode in public and 86 per cent in private hospitals,” the study added.

This comparative study for public and private hospitals was carried out in Chhattisgarh state by Dr Alok Ranjan, Assistant Professor, School of Liberal Arts, IIT Jodhpur, along with Dr Samir Garg (First author and Executive Director, State Health Resource Centre (SHRC), Chhattisgarh), Narayan Tripathi, Senior Program Coordinator, SHRC, and Kirtti Kumar Bebarta, Program Associate, SHRC.

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Highlighting the need of the research, Dr Alok Ranjan, Assistant Professor, School of Liberal Arts, IIT Jodhpur, said, “Provisioning of inpatient care under public facilities is more cost effective compared to the private sector in India. Therefore, there is an urgent need to invest in public health facilities compared to purchasing it from the private sector.”

This survey was carried out with the support of the State Health Resource Centre, a technical agency working for the Department of Health, government of Chhattisgarh, in 64 healthcare facilities across the state. The current study found that total cost per hospitalisation in private hospitals was several times greater than the public hospitals. This is the first study so far in this field that has empirically presented a comprehensive picture of spending per episode of hospitalisation under public and private healthcare facilities in India.

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