When the poorest family falls ill, what actually breaks?

For India’s poorest families, a serious illness can become much more than a medical emergency. In today's 'YOUR INDIA' column, Santosh Nair looks at distress financing, borrowing, asset sales and the chain reaction that begins when healthcare costs overwhelm a household with almost no financial buffer.

In rural Bihar, a labourer’s family spends, in an average year of serious illness, almost everything it has. Not a large share. Not most of it. Research on health spending patterns puts the figure for the poorest rural households in Bihar at 86.1 per cent of their entire consumption, food, clothing, rent, everything, going toward medical costs in that one year.

In parts of Tripura, the number for the urban poor is worse than 86 per cent. It crosses 100. Researchers recorded lower-middle income urban households there spending 167 per cent of their consumption on health, which is only possible one way: by consuming savings that no longer exist, or borrowing against a future that has not arrived yet.

These are not typical years. They are illness years. But illness years are exactly the years a family cannot choose to skip.

Nationally, India’s poorest rural households spend about 23.4 per cent of everything they consume on health, compared with 17.4 per cent among the richest. The gap looks modest on paper. In a family with almost nothing spare, 23 per cent is not a budget line. It is the difference between eating three meals and two.

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