Double burdens on Nepalis: Diseases and out-of-pocket spending

Achieving Universal Health Coverage (UHC) is a far cry for Nepal due to poor targets, ineffective implementation of health schemes and existing barriers to seek health services from health facilities. On the one hand, there is a high burden of disease in the country, on the other, citizens are highly reliant on Out-of-Pocket (OOP) expenditure while seeking health services. These two contrasting realities demand ambitious health targets and robust health systems to deliver.

Financial aspect is a key to people’s access to health services in the country. But the burden of the disease on the country is also too high. Non-Communicable Diseases (NCDs) are an increasingly important contribution to the burden of disease in Nepal. According to Nepal Burden of Disease Report (2017), 66 percent of deaths in Nepal were due to NCDs. However, Dr Krishna K Aryal, one of key contributors for Nepal Burden of Disease Study 2019 (yet to be included in the national report), recently said at the National Health Research Council conference that NCD’s contribution to the mortality has further increased to 71 percent in 2019. Smoking, high systolic blood pressure, household air pollution, ambient air pollution and high fasting plasma glucose have been found to be key risk factors of death in 2019.

While the burden of disease is high, as is the case with lower-middle-income countries, a vast majority of Nepali people have no access to quality health care. Poverty is still a big hurdle though Nepal has witnessed some progress in the fight against poverty. For example, 28.6 percent people are suffering from multidimensional poverty in the country. Poverty is highest in Karnali Province (51 percent) followed by Sudurpashchim (48 percent).

In this situation, people have to rely heavily on out-of-pocket (OOP) payments to seek health services. In 2018, OOP expenditure of total health expenditure for health care services and goods stood at 50.79 percent. The OOP saw fluctuations over the years. For example, OOP stood at 42.502 percent in 2006, 63.53 percent in 2013 and 57.78 percent in 2017. The trend does not show an optimistic picture in reducing OOP payment for health services.

Nepal commits to achieve UHC but without significantly reducing OOP spending on healthcare, achieving UHC will be a herculean task. Actually, Nepal does not seem to have set a top priority on reducing OOP expenditure. Sustainable Development Goal target 3.7 aims to achieve universal health coverage including financial risk protection, access to quality essential health care services and access to safe, effective, quality and affordable essential medicine and vaccines for all. Among several indicators for this target, OOP is also one. The government aims to reduce OPP expenditure to 35 percent by 2030. In 2019, OOP has been reduced to 45 percent but as stated above, the trend of OOP reduction is not much progressive over years and setting a target to reduce to 35 percent by 2030 itself is too poor to help achieve universal health coverage. Nepal Burden of Disease Report (2017) stresses the need to reduce reliance on direct OOP payment for health care. Experts from the health sector also echo similar views. For them, to achieve UHC, affordable health care is critical.

Dr Krishna says expanding the coverage of health insurance schemes could be one option to increase people’s access to health care particularly of NCDs, the major cause of death. Presenting a similar opinion, Dr Suresh Tiwari, Country Director of Oxford Policy Management in Nepal, argues that high OOP payments bring the risk of catastrophic health expenditures and families’ impoverishment. Despite the existence of several legal and institutional initiatives, Nepal relies mostly on household OOP payment for financing a large share of health care services and health goods which creates barriers to universal health coverage.

The Social Health Insurance Scheme introduced by the government of Nepal can help reduce OOP. However, enrollment in this scheme is very low. As of March 2021, 75 percent of 1,430,000 populations have renewed this service. This figure is not optimistic as Dr Tiwari opines this is a time to critically review where and why the government has remained not so successful to attract people to this scheme.

Nepal’s health system is struggling to strengthen itself. The outbreak of Covid-19 pandemic has made the issue of quality health care service more pressing. As federalism is still under the process of institutionalization, shared responsibility and balanced distribution of the resources is important to deliver health care services that are accessible to the vast majority of people who cannot pay for the health services. For this, the country should set ambitious health targets, the health system should be well prepared and appropriate and effective mechanisms should be established to implement policies from the federal to the local levels.

(Shreeman Sharma is a social science researcher associated with HERD International, a health research organization. The opinions expressed do not represent the organization he is associated with. He can be reached at bigyansharma@gmail.com)

(This article was originally published at Nepallive Today https://www.nepallivetoday.com/2021/07/11/double-burdens-on-nepalis-diseases-and-out-of-pocket-spending/