Determinants of Household Health Expenditure: Case of Urban Orissa

The main objective of the paper is to increase awareness – not only among health researchers but also among policy makers and practitioners who use health research findings – about the influence of socioeconomic characteristics in terms of income and education on household health expenditures, as well as to encourage improved approaches. The study finds that income of the household has significant influence on its health expenditure where as the effect of education is insignificant. From the study it is found that as disposable income of the household increases, individual takes more care of his life, hence, health expenditure increases but at a particular level of income, due to high life risk, health expenditure becomes independent of income and perfectly elastic, which is termed as “High Life Risk Path (HLRP)”. The health expenditure during HLRP depends on household’s past saving and loanable capacity.