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National Health System Cost Database for India

Author: Mr. Taeyoung Kim
27 Aug 2019 3052 0

Information on the unit costs of health services is an essential element of a country’s health system. Acknowledging its growing importance, India has recently launched National Health System Cost Database for India as a one-stop shop for cost information. The targeted users of this platform range from health economists, health care program managers, policymakers, Ministry of Health officers, to health financing experts, NGOs, donors, and academia. It is expected that the database will support economic evaluation, price setting, resource requirements, resource allocation decisions including budgeting, and many others as a useful, evidence-based tool. The establishment of this database was a result of international collaborative efforts with local context and data. Local leadership rooted in Department of Community Medicine & School of Public Health, Post Graduate Institute of Medical Education and Research (DCMSPH, PGIMER) Chandigarh spearheaded this project with technical support from International Decision Support Initiative (iDSI). Also importantly, it was inspired and developed based on the Thai costing menu from Health Intervention and Technology Assessment Program (HITAP) in Thailand. The data collection was also a collective effort of a consortium which consists of several local organizations, namely – PGIMER, Public Health Foundation of India (PHFI), Indian Institute of Technology (IIT) Madras, and Tata Institute of Social Sciences (TISS).


Standardized Methodology for Costing Health Services in India

The PGIMER team created a data collection tool to assess the economic cost of health services delivered at different levels of health facilities in India, using an economic costing methodology. More specifically, the data collection was undertaken in 167 health facilities from 6 different states of Himachal Pradesh (34 facilities), Punjab (14), Haryana (24), Odisha (35), Kerala (38), and Tamil Nadu (22). They also developed a separate tool for each level of health facilities given that they vary in type and quantity of service delivery and resources used. They applied the bottom up costing method against a pool of 167 health facilities located in 6 different Indian states for the data collection, covering a variety of information on economic costs of outpatient visits, inpatient stays, salaries, capital resources, drugs and consumables, water/electricity/sanitation, maintenance, dietetics, laundry, and others. The data collection process started with identifying cost centers and classifying them between primary/patient care centers and secondary/supportive cost centers. The former includes the units of health facility which are directly involved in the delivery of health care such as outpatient department, inpatient ward, operation theatre, and others. The units which support those primary cost centers were categorized as the secondary/supportive cost centers, including laboratory, pharmacy, dietetics, laundry, administration, and others. With this classification the consortium collected data on quantity of both the capital and the recurrent resources consumed on delivering services under each group for the reference financial year. Finally, they performed interviews on the staff members from each level of health facility including doctors, pharmacists, nurses, paramedical staff, etc. The interview questions aimed to assess the time spent on their activities such as outpatient consultation, inpatient care, operation theater (the so-called regular activities) and administration, meetings, and others (the so-called other activities).


Contribution from HITAP & GEAR

The HITAP made a substantial contribution to the establishment of India’s first costing menu by sharing lessons learned and technical assistance from its experience on developing a list of standard Thai costing menu to provide clear guidance on unit costing processes. The PGIMER and the consortium highly valued HITAP’s qualification as it also successfully developed a set of National Health Technology Assessment Guidelines for Thailand which includes a chapter on measurement of costs. Indeed, the Indian costing menu used a similar methodology to the Thai version which proceeds on cost center identification, quantity measurement, and valuation of resources used.

In fact, the challenges surrounding costing menu have been at the center of discussion for HITAP. To efficiently and effectively address this particular issue, HITAP added an article on costing its Guide to Economic Analysis and Research (GEAR) online resource. Further, under one of the Mind Maps sections where HITAP provides long term or short term solutions to common and important methodological difficulties in conducting economic evaluations, one can easily brainstorm and grasp key concepts in costing by following the flows of possible recommendations. Please visit the GEAR website for details - Also, the aforementioned article on costing can be accessed here -

HITAP continuously updates and improves the GEAR to show the challenges, solutions, and issues facing Low and Middle Income Countries (LMICs), with India’s experience of the costing menu added to the wealth of information on the website.

[GEAR Mind Map on the Lack of Data on Costing]

Looking Beyond

India’s new costing menu encourages other LMICs to develop their own costing menus or at least use one from similar settings. However, that should not be the ultimate goal for each country as these costing menus require routine revisions and updates. When there exists a central unit in each country mandated to assess, revise, and update its costing menu on a regular basis, the LMICs can advance one step closer towards achieving the more efficient and reliable health policymaking with evidence-based priority setting in practice.

It is worthwhile to note that iDSI team as part of advisory committee has supported the Global Health Cost Consortium (GHCC) to establish Reference Case for Global Health Costing. Given that this material is available now, it may help boost the future development of country costing information/database that are more comparable and usable across settings. This will be highly beneficial to countries without health economic expertise and resources, especially since they also often have more resource constraints. The GHCC is also partnering with iDSI via the GEAR.