Orissa ranked 14th among 23 states in health services index prepared by India Financial Protection Survey, conducted jointly by the Max New York Life Insurance and the National Council of Applied Economic Research (NCAER).
The survey highlighted the need of improvement in health planning and the state’s lack of preparedness to deal with health expenses.
The health index was arrived at taking into consideration average household income, household spending, expense on health and health insurance penetration.
The survey reveals that many households in Orissa borrow to meet health expenses and only 6.35 percent give importance to health insurance. While the survey covered 63,000 households in the country,a bout 3.46 percent of the total households surveyed were from Orissa.
Briefing the media on the findings of the study, Sumit Rai, senior vice-president, Max New York Life said, the health expenses as a proportion of income (major sickness not included) in Orissa is about 30 percent, which is quite high.
While the average household income in the state was Rs 40,029, the health expenses were about Rs 12,188. “If a household spends 30 percent of its income on health expenses, it becomes very difficult on its part to fund other expenses”, he said.
Referring to the health , Rai said, the households experiencing major sickness was 10 percent in urban and 16 percent in rural areas. Overall figure for the state was 16 percent, he added.
The survey showed 35 percent of the people in rural areas met the health expenses using the savings while 18 percent obtained loans and borrowed from relatives.
Similarly, in urban areas 71.2 percent people used their savings to meet the medical expenses and 13.2 percent obtained loans for the same purpose. For the state as a whole 39.1 percent of the people used their savings and 18 percent borrowed to meet the treatment cost for major illness.
Reflecting on the savings pattern of the people in Orissa, the survey states that 82 percent people save for emergencies,74 percent for education of the children and 75 percent for the old age. While 40 percent of the people surveyed saved in home, 48.8 percent parked their surplus money in the banks.
However, this is quite low compared to about 60 percent savings rate for the country as a whole. Similarly, only 6.35 percent give importance to health insurance which is very insignificant. Stating that the penetration of health insurance in Orissa is about 0.71 percent compared to 1.2 percent in the country, Rai said, this is miserable compared to 84.2 percent in United States.
Though health expenses are a major concern of Indian households, health is not accorded top priority in terms of savings and expense planning.
While health related expenditure needs to be planned for, financial literacy programme should be taken up to increase health insurance penetration in the long term, Rai added.
