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June 24, 2021

Pakistan annually spends Rs1,206b on health

ISLAMABAD: Pakistan’s total expenditures on healthcare annually estimated at Rs 1,206 billion.

According to findings of National Health Accounts (NHA) for 2017-18 released by Pakistan Bureau of Statistics, the total health expenditure in Pakistan is estimated as Rs.1,206 billion in 2017-18. This shows an increase of Rs.288 billion over the fiscal year 2015-16, which is a 31.3% increase in nominal terms as it includes inflation of health care goods and services.

Out of total health expenditure in Pakistan, 40.9% Pakistan annually spends Rs 1,206 bn on health made by the general government. Out of that, 16.3% are incurred by the federal government whereas 54 Pakistan annually spends Rs 1,206 bn on health accrued from its civilian part and 46% from its military setup.

Around 58.5 percent of the health expenditures are made through the private sector out of which 88 Pakistan annually spends Rs1,206 billion on health out of pocket (OOP) health expenditures by private households. Development partners and donors’ organizations have 0.6 percent Pakistan annually spends Rs 1,206 billion on health share in total health expenditures of Pakistan for the FY 2017-18.

The annual per capita Current Health Expenditures (CHE) for Pakistan as per NHA 2017-18 are (48.1US$) Rs. 5,283 while in NHA 2015-16 it was (45.0 US$) Rs4,688.

The ratio of CHE to Gross Domestic Product (GDP) according to NHA 2017-18 is 3.2 percent while the ratio of general government health expenditures to total general government final consumption expenditure is 12.2 percent .

The ratio of private sector health expenditures according to NHA over total household final consumption expenditure are 2.5 percent .

According to this NHA report, out of total health expenditures in Pakistan, 41 percent is made by general government agents which include the social security, Zakat, Bait ul Mal and Autonomous Bodies, Corporations health expenditures as well.

The private expenditures constitute the 58.5% of total health expenditures in Pakistan, out of which 88 percent are households OOP health expenditures.

The share of development partners, donors organizations in total health expenditures is almost 0.6 percent .

The military health expenditures have been provided by the Military Accountant General. They include the expenditures by Army, Navy, Air Force, Defense Production Establishments, Inter Services Organizations and Accounts Offices including Pakistan Military Accounts Department. Military health expenditures are funded by government / Ministry of Finance through Ministry of Defense.

The highest expenditure is incurred by “private limited company” (Rs30,654 million, 44 percent) followed by “individual proprietorship” (Rs16,490 million, 24 percent). The total expenditure of Sindh (Rs. 36,660 million, 52 percent) is more than Punjab (Rs26,966 million, 39 percent) apparently because metropolis Karachi, located in Sindh, is the hub of health facilities in Pakistan.

The expenditure of hospitals run by “Trusts” was Rs. 12,521 million (18 percent). The number of “Partnerships” and “NGO/NPO” is 309 and 529 respectively but incurring only 3.26 percent and 6 percent of the expenditures.

The expenditure of hospitals categorized as “private limited company” is higher than all other ownership categories. Sindh and KP have the highest expenditures in “private limited company” while Balochistan & Punjab have the highest expenditures in “individual proprietorship”.

Analysis of OOP survey also reflects that in Pakistan 50.63 percent of the total OOP spending are incurred on “Medicine/Vaccine”, 12.97 percent and 8.22 percent on doctor s fee and diagnostic tests respectively and 7.7 percent of the total OOP spending are incurred on transportation costs. Further analysis of OOP data with regard to provinces indicates that OOP spending on “Medicine/Vaccine” is highest in Punjab (53.74 percent) followed by KP (49.60 percent), Sindh (42.76 percent), while the lowest share is of Balochistan (39.76 percent).

Second highest spending for all the provinces is on doctors fee and then the diagnostic tests. The reason behind high OOP spending on medicine is that, in private clinics, doctors take the charges including those of medicine and the value reported in the medicine cost. Third highest spending for all the provinces is diagnostic tests. While the fourth highest spending for all the provinces is transportation costs. The high share of transportation costs highlights that health care facilities often are far away from the population.

The OOP expenditure on the category "cost of surgery in Balochistan is 14.34 percent which is significantly higher than other provinces.

The lowest share is of tips because mostly tips are given in the hospitals at the time of new births in Pakistan. Expenditures on accompanying persons incur mostly in the cases of inpatient. The KP has the highest percentage share of expenditures incurred on accompanying persons.