Maternal and neonatal health expenditure in mumbai slums (India): A cross sectional study

There have been numerous calls to improve neonatal survival and maternal health outcomes by stimulating demand for appropriate services [1‐3]. Within this literature, the cost of care as a barrier to access has been frequently highlighted [4‐6]. Similarly, the relationship between health spending and poverty has been discussed by Wagstaff [7], Van Doorslaer et al [8] and Whitehead et al [9, 10], among others.

India accounts for more than 25% of maternal deaths globally [11]. The majority of studies on maternal health spending and service use in India have been conducted either at the macro-level (State or National) [6, 12, 13], or have had a predominantly rural focus (see for example [14]). Given that out of pocket payment is the principal method of financing health care throughout Asia [15], that over 72% of expenditure in India is financed out of pocket [13, 16], and that Navaneetham et al [12] highlight significant difference in maternal care use between Indian States, there is a strong case for more focussed study of vulnerable populations.

Mumbai is India's most populous city, with more than 16 million people spanning multiple ethnic, cultural and linguistic groups. More than half of Mumbai's population currently live in slums [17], and families in these relatively deprived areas constitute the focus of this paper. Although no directly comparable study has yet been conducted within Mumbai's slum-dwelling population, a related study by Shah More et al [18] provides a comprehensive overview of maternal care seeking practices in Mumbai, with a focus on the poor. The authors describe high levels of antenatal care use (93%) and institutional delivery (90%), with antenatal care evenly split between public and private providers and delivery care slightly skewed towards the public sector. They describe the complexity of service choice in the Mumbai context and raise concerns about referral practices and the quality of care in both the public and private sectors [18]. By comparison, Griffiths and Stephenson conducted a qualitative study of care seeking in Mumbai and Pune [19]. They found that women perceived private services to be superior to government services, and poor perceptions of government care motivated home deliveries if women could not afford private care [19].

Within the context of calls to stimulate demand for care, poorer households may find it difficult to plan for and meet the costs of maternity care in a pluralistic health system. Inability to meet the cost of maternity care can act as a significant barrier to service access and may be a determinant of maternal and neonatal morbidity and mortality. Among those who do use services, health spending that constitutes a significant portion of household resources may also reduce other consumption, including spending on food and education, and may have both immediate and intergenerational effects on household poverty and the equity of health service delivery [7].

Health spending is generally considered 'catastrophic' when a household must reduce its basic expenditure to cope with health costs. This is assumed to happen when health expenditure exceeds a proportion (usually 40%) of total household income or expenditure, thus 'crowding out' other spending. Using a proportional measure such as this (health spending as a percentage of total spending), economists can approximate the welfare effects of medical expenditures [4, 15, 20‐22]. Xu et al. [20] used data from 59 countries to explore variables associated with catastrophic health expenditure. They defined health expenditure as catastrophic if it exceeded 40% of income remaining after subsistence needs were met, and identified three key preconditions for catastrophic payments, all of which hold in the context of our study: availability of health services requiring payment, low capacity to pay, and a lack of prepaid health insurance. Su et al. [4] quantified the extent of catastrophic health spending and determined the risk factors in Nouna District, Burkina Faso. They used different thresholds of catastrophic health expenditure and found that even expenditure in the region of 6-15% of total income had catastrophic consequences. The key determinants of catastrophic expenditure were low economic status, modern medical care use (usually use of private services), illness episodes and a household member with chronic illness. A study in Thailand compared the incidence of catastrophic expenditures (>10% of total consumption, including food and non-food expenditure), before and after the introduction of universal health care coverage [22]. Households using private inpatient services were more likely to face catastrophic expenditure. Finally, van Doorslaer et al. [15] estimated the magnitude and distribution of catastrophic expenditure in 14 countries and territories, accounting for 81% of the Asian population. They found that countries relying most heavily on out-of-pocket (OOP) financing had the highest incidence of catastrophic payments.

In short, the literature consistently argues that out-of-pocket medical expenditure increases the risk of catastrophic spending and medical poverty. However, Flores et al. [23] argue that this definition of catastrophic spending is insensitive to how spending is financed through coping strategies. They provide an extensive review of the literature on coping with health payments, and consider not only the extent of health spending but also the strategies through which it is financed. Using nationally representative data from India, they found that coping strategies financed up to 75% of inpatient care. Capacity to draw on savings, assets, credit and transfers from friends and relatives may thus have protected the consumption of other goods, at least in the short term. They suggest that ignoring coping strategies may overstate the risk to short-run consumption, exaggerate the short-run scale of catastrophic payments, and potentially understate the long-run burden of health payments that may include significant debt financing.

Aside from measuring the impoverishing effect of health spending, the incidence of catastrophic payments is also an indicator of equity in health service provision. For example, Xu et al. [21] investigated whether the abolition of user fees levied at government health facilities in Uganda increased access for the poor and reduced the risk of catastrophic health expenditure. They defined expenditure as catastrophic if it exceeded 40% of income remaining after subsistence needs were met and found that utilization among the poor increased after the abolition of fees. Unexpectedly, however, the incidence of catastrophic spending among the poor did not fall. The authors argue that the most likely explanation was that frequent unavailability of drugs at government facilities after 2001 forced patients to purchase from private pharmacies. Moreover, informal payments may have risen to offset lost revenue from formal fees. This finding points to the importance of measuring both formal and informal health expenditures.

In addition to the formal and informal constituents, the price of health services usually incorporates both a direct and indirect cost. McIntyre et al. [24] and Russell [25] provide detailed overviews of health expenditure studies, identifying direct and indirect costs commonly used to quantify the economic consequences of ill health. Examples of direct medical costs commonly include scheduled user fees (or the price of traditional or private care), drug costs, informal payments and payment for diagnostic tests [26‐29]. Indirect costs generally cover productivity losses and the opportunity cost of care seeking, including travel and waiting times [30‐33].

While analysing spending can highlight the drivers of medical poverty and inequitable care, the literature on health equity is also concerned with the progressiveness of financing. The progressiveness of a financing system refers to "the extent to which payments for health care rise or fall as a proportion of a person's income as income rises. A progressive system is one in which health care payments rise as a proportion of income as income rises, whilst a regressive system is one in which payments fall as a proportion of income as income rises" [34]. There are different ways to capture progressiveness in health financing. The most direct is to examine health spending as a share of ability to pay. For example, a study from Sierra Leone showed that the rural poor can be disproportionately disadvantaged by user charges for health care, spending a higher percentage of their incomes on health care than wealthier households [35]. By comparison, Roy and Howard [36] examined how well the Indian healthcare system protected households of differing living standards against the financial consequences of health shocks. They found that OOP payments increase with ability to pay. They suggested two explanations for this observed relationship: firstly, a lack of insurance requiring the better-off to pay more to secure higher quality care, and secondly, the poor may limit expenditure more stringently and possibly forego care altogether. In this literature there is a gap in recent evidence as it relates to the urban poor in low and middle income settings.

In summary, equitable healthcare and the reduction of medical poverty are key goals of health systems and financing reform. In this paper, we analyzed direct and indirect expenditure on private and public maternity care in urban slum communities in Mumbai. The first objective was to understand what proportion of household spending was allocated to maternal health expenditure, and how this proportion varied by socioeconomic status (SES) as a measure of the progressiveness of payments. The second objective was to analyze the sources of finance (coping strategies) used to meet this expenditure. Finally, we analysed the relative impact of maternal health expenditure on current consumption, to estimate the incidence of catastrophic payments.

We analyzed expenditure on maternal and neonatal care in urban slum communities in Mumbai. The first objective was to describe the constituent parts of maternal spending. We found that the cost of delivery care was the greatest maternal expense and that the cost of delivering in a facility was, on average, more than five times the cost of delivering at home. Formal and informal payments for delivery care constituted 90% and 10% of total delivery care expenditure, respectively. We also found that, while direct costs comprised the greatest share of maternal spending - indirect costs constituted a sizeable 19% of total maternal spending on average.

Our next objective was to understand the equity of maternal spending by measuring how spending varied by socioeconomic status (SES). We found that indirect spending was regressive for all types of care, in all sectors. Public services and home deliveries were inferior goods used by poorer families and as such, all spending in the public sector was regressive. As demand for the private sector increased with SES, total and direct spending on private maternal care had a positive Kakwani Index i.e. was progressive. Within indirect costs, those in the higher SES quintiles spent more on transport and tips while the poorest spent more on lost wage income. The poorest also faced a significantly higher proportion of informal payments. These findings, together with the observation that women in the lowest quintile funded significantly more spending from borrowing, highlighted how those in the lower quintiles are most at risk of both transient and chronic poverty [23].

The final objective was to analyze catastrophic spending and the sources of finance (coping strategies) used to fund maternal health expenditure. Most maternal and neonatal expenditure was financed with savings (57.46%), current income from wage and salary (39.14%) and borrowing (17.41%). There were, however, significant differences in coping strategies across the wealth quintiles, with the poorest relying more on wages and borrowing to finance spending and the least poor spending relatively more out of savings. Before adjusting for coping strategies, 41% of our sample spent catastrophically on maternal and neonatal care. A significantly higher proportion of catastrophic spending occurred among women in the highest quintile. This could be because women in the lowest quintile were forced to control spending by opting for cheaper inferior services (public sector care and home deliveries), less frequent consultations, or foregoing care altogether. Conversely, women in higher wealth groups - although not earning very much more given the nature of the sample - were more likely to use higher-cost private services. These results suggest that women in the highest quintile could afford to spend more, not only because they were less poor, but also because they had more access to savings. The findings reflect behaviour observed in at least two other studies conducted in Mumbai [18, 19]. In short, poorer people have no safety net and lack flexibility and confidence in future income. The other issue highlighted by Shah More [18] is one of 'culture'. They found that urban communities are aspirational, and that one of the aspirations is to achieve 'modernity' in health care. Depending on socioeconomic status, maternity care steps up through a sequence from home delivery, via public sector antenatal care, to public sector delivery, to private sector delivery (the highest aspiration). Identification with a higher socioeconomic stratum is also aspirational and may lead to uptake of health care services that proves more catastrophic than anticipated [18].

As with most analyses of this kind, the study has a number of limitations. The extent to which the findings can be generalised to greater Mumbai or to slum-dwellers in other cities, would depend on how comparable is the supply of maternal health services among other factors. The study also has little to say about the quality of care received and whether services perceived to be inferior were in fact of lower quality. Finally we should be circumspect about the results of the catastrophic spending analysis as the data on household income were imputed from a national dataset and not collected within the primary survey. That said, the incidence of catastrophic spending in this setting was so high that even quite large changes in the exact measure would not change the fact that a significant percentage of households were being impoverished by maternal health spending. After adjusting for coping, 15% of our sample experienced catastrophic spending. There was no significant difference in the incidence of catastrophic spending across quintiles after adjusting for coping. A final limitation of the study is that respondents, in the case of direct spending only, were allowed the option of reporting total rather than disaggregated spending. These responses may be vulnerable to a downward bias [51‐53].

These results highlight the significant problem of inequitable and catastrophic health spending in this urban population. However, they also suggest some potential policy solutions. Given high, and highly regressive, indirect spending on care, the removal of user fees alone is unlikely to relieve the burden on the poorest. Cash transfers (conditional or unconditional) such as the Janani Suraksha Yojana (JSY) scheme launched by the Government of India may be effective in urban Mumbai if it is possible to better target poorer mothers [54]. This may go some way towards reducing the negative effects of OOP spending among slum dwellers and may compensate partially for the loss of earnings amongst the poorest. In addition, better regulation of informal payments, with the aim of their prevention or removal, would further reduce the burden on the poorest. For the small number in formal employment, requiring employers to allow pregnant employees to attend maternal care services without loss of earnings should reduce the double burden on that group. Given that the poorest are more likely to deliver at home or to use public care, policy makers should also ensure that these care options provide an acceptable level of care for mothers and their neonates. Other strategies to reduce loss of earnings and the 'double hit' on wages experienced by the most poor would further improve the equity of, and access to, maternal and neonatal care in urban Mumbai. Without changes such as these, the poorest will continue to forego higher-cost institutional deliveries, placing themselves and their neonates at risk.

1. We used the Stata command "ttest" applying the "by(groupvar)" option that specifies the variable that defines the two groups that ttest will use to test the hypothesis that their means are equal. In our study, the two groups are the lowest and the highest quintiles.

2. Data on Monthly Per-capita Consumption Expenditure (MPCE) by dwelling type is taken from Table 11U in the Appendix A of 48. National Sample Survey Organisation: Household Consumer Expenditure in India 2005-2006. In., vol. 523: NSSO; 2006. The average MPCE is 686 Rs, 822 Rs, 1431 Rs for individuals living respectively in Katcha, Semi-pucca and Pucca.