Is Financial Protection for Cancer Enough?

Saying that cancer is an expensive disease is an understatement, particularly in such low and middle income countries (LMICs) as India. According to estimates from 2004, one inpatient admission for cancer in India can cost 40-50% and 80-90% of annual per capita income in public and private hospitals, respectively. Given that cancer is a chronic disease, often requiring multiple admissions, it’s no wonder that over 45% of families with one cancer patient face catastrophic expenditures and 25% are pushed below the poverty line (BPL). To put this in perspective, the likelihood of catastrophic expenditures is 160% higher for cancer than for communicable diseases in India. On top of these direct medical expenses, cancer patients also face unaffordable and indirect costs of transportation and loss of daily wages.

These alarming statistics, and the fact that NCDs including cancer are the leading cause of death in India, have encouraged individual Indian states to devise insurance schemes that increase financial protection for the poor. Andhra Pradesh, a state in south India, aims to alleviate this financial burden through the tax-funded Rajiv Aarogyasri Scheme (RAS). The primary objective is to improve the poor’s access to quality treatments for a specific list of diseases. The state government recognized that public hospitals alone cannot achieve this goal, due to staff and supply shortages, and low quality standards. On the other hand, private hospitals, initially only accessible to the rich, are well equipped and staffed to provide specialist services. Thus, RAS empanels and funds tertiary care in both private and public hospitals using tax revenues.

RAS, in many ways, seems too good to be true. The scheme provides completely cashless tertiary care – including transportation, food, investigations, and therapies – for BPL families, which apparently constitute 87% of the state’s population. Among the treatments covered are medical, surgical, and radiation oncology. Since its inception in 2007, RAS has covered approximately two million surgeries and therapies. Due to its apparent success, RAS has received international accolade as an innovative public-private partnership (PPP) which has promoted access to good quality healthcare.

RAS Claims (2007-2010) Adapted from [A Critical Assessment of the Existing Health Insurance Models in India]

Yet recently, the cost-effectiveness of the scheme has been called into question. Every year, approximately 20% of RAS therapies are related to cancer, but whether this money is being used in the most efficient manner is unknown. In an effort to answer this question, I talked with state government officials and oncologists in both public and private hospitals and attempted to learn from their experiences and opinions on cancer policies in the state.

From these key informant interviews, two major flaws in cancer care and control (CCC) efforts became immediately clear: the absence of consistent prevention efforts and inability to follow up with patients. Every single provider I talked with lamented the fact that the majority of cancer patients they see are diagnosed at late stages. Often, due to metastasis and complications, treatments become less effective at advanced stages of the disease. But because a life is a life, these doctors end up performing procedures that are reimbursed through RAS and will likely have little effect in extending or improving quality of life. As the key informants suggested, the problem is that the overly siloed approach toward financial protection for treatment has left gaping inadequacies in access to prevention and screening. And the most common cancers in India happen to be preventable through behavioral change (tobacco-related lung and oral cancers) and treatable if detected early (cervical and breast cancers). So essentially, many cancer patients may be needlessly suffering and the state government may be needlessly spending money on treatments that may not even be efficacious after all. And, to make matters worse, many informants asserted that after treatment, the majority of patients are lost to follow up – providers cannot track and determine whether the patient is “cured,” faces recurrence, or dies.

The point is, while RAS is certainly increasing access to treatment, a sole focus on tertiary care may not be economically justifiable. According to the key informants, we must recognize that the relationship between cancer and poverty is not one-way, but cyclical. The poor may face a higher incidence of cancer due to socioeconomic differentials in risk factor exposure, such as tobacco consumption. Moreover, cancer is often diagnosed at late stages due to inadequate diagnostic infrastructure, particularly in rural regions, where the majority of BPL individuals reside. These patterns confirm that poverty increases risk and severity of cancer and cancer further entrenches families in poverty.

This is the first of a series of posts that will delineate the main health systems challenges that must be overcome in providing comprehensive CCC, even with such an innovative insurance scheme as RAS. These discussions will show that CCC is inherently tied to the movements toward Universal Health Coverage, which, according to the World Health Assembly, entail two main goals: “to provide all people with access to needed health services (including prevention, promotion, treatment and rehabilitation) of sufficient quality to be effective; and ensure that the use of these services does not expose the user to financial hardship.” Currently, the state of Andhra Pradesh is focusing on the second aim, but is hopefully in the process of shifting its attention in order to break, or at least weaken, the cycle of impoverishment.


Pooja Yerramilli is a Yale graduate and MSc. candidate at the London School of Hygiene and Tropical Medicine and the London School of Economics. She has been involved in cancer advocacy efforts for several years, and was an active participant in policy discussions regarding smoking behaviors and insurance coverage of smoking cessation treatments at Yale. She recently worked with the Indian Institute of Public Health to complete a research project on the Financing of Cancer Care and Control in India.

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