Cutting out-of-pocket medical costs: Govt target ever elusive

"We are definitely behind the target set in the healthcare financing strategy. We need to expand the health insurance-based financing scheme across the country to overcome this."

— Dr Subrata Paul Health Economics Unit at health ministry

A decade ago, the government set a target of bringing out-of-pocket health care expenses down to 32 percent by 2032, but the burden of medical spending on people has only gotten heavier over the years.

In 2012, when the government adopted the Health Care Financing Strategy, out-of-pocket (OOP) expenses were 62 percent of the national health expenditure.

In 2020, it rose to 68.5 percent of the national health expenditure of Tk 77,734.7 crore, which is 2.8 percent of the GDP, according to Bangladesh National Health Accounts (BNHA) 1997-2020.

But the World Health Organization says OOP in Bangladesh was 74 percent in 2020,  the second highest among the South Asian nations followed by Afghanistan's OOP of 74.81 percent. Bhutan had the lowest OOP at 15.42 percent.

OOP is people's expenses for medical care that aren't reimbursed by neither public nor private insurances.

The highest contributing factor behind high OOP is the cost of medicine rising due to unethical marketing by drugmakers, said the study revealed by the health ministry at a hotel in the capital yesterday.

The second highest contributing factor is diagnosis costs, it added.

The Health Care Financing Strategy also set a target of increasing the government's health expenditure to 30 percent by 2032. But it was 23.1 percent in 2020.

"We are definitely behind the target set in the healthcare financing strategy. We need to expand the health insurance-based financing scheme across the country to overcome this," said Dr Subrata Paul, focal person of BNHA at the Health Economics Unit of the ministry.

While presenting the findings at the event, he stated that 5 percent of the share of the national health expenditure came from development partners, 1.7 percent from NGOs and 1.6 percent from the private and autonomous organisations.

Of the total OOP, about 64.6 percent is spent on medicine, 11.7 percent on laboratory charges, 10.8 percent on doctors, 2.4 percent on other healthcare practitioners, 0.3 percent on dentists, 10.1 percent on hospitals and 0.1 percent on medical products.

Between 2012 and 2020, the per capita health expenditure increased from $28 to $54.

The study said the people in the richest quintile accounted for around 54 percent of the OOP expenses and those in the poorest quintile 4 percent.

In 2020, Dhaka division with the largest population and highest number of health facilities saw 37.7 percent of the national healthcare expenditure while Mymensingh saw the lowest 3.2 percent.

DRUGS COULD COST LESS

Anwar Hossain Howlader, secretary of the health services division, said, "I saw many physicians performing umrah [hajj]… with money from drugmakers. They take refrigerators, televisions, and even flats. If the unethical practice was not there, it [OOP] could be reduced."

Besides, the unnecessary packaging raises the retail prices of medicine, he said, adding that officials would meet the drugmakers to discuss how medicine prices could be lowered.

Major General Mohammad Yousuf, the director general of Drug Administration, said the authorities were under "serious pressure" to hike medicine prices.

"But drugmakers can supply medicines at a lower cost if they reduce the spending on aggressive marketing, lavish packaging, gifts for physicians, and donations to professional associations," he said.

Bangladesh will have to pay more to import Active Pharmaceutical Ingredients as soon as the country graduates into a middle-income country by 2026, he said, adding that that would further raise medicine prices.

There should be a system to audit the prescriptions, he added.