Linking Women’s Income and Preventive Healthcare

Context

Recent research has found that enabling women’s economic empowerment has a clear impact on household health. Families allocate less money to reactionary health care when women earn more in their households. Instead, the additional funds are funneled into preventive health care, such as healthy food and fitness, reducing overall expenditures for health care.

Key Economic and Epidemiological Shifts

The formalization of women’s work, digital payments and policy changes have helped steadily increase the number of women in the workforce in recent years.

Epidemiological Transition: India’s battle against the rising tide of chronic lifestyle diseases such as diabetes and hypertension. These diseases have a heavy economic burden on families.

The EPF Reform as a Case Study

The link can be seen in the case of the 2018 reform of the Employees’ Provident Fund (EPF).

• The Policy: The reform reduced mandatory provident fund contributions for newly employed women from 12% to 8%.
• The Income Effect: This increased women’s after-tax wages, but did not change their wages before taxes.
• Health Outcomes: The study revealed that female-led households which were the beneficiaries of this policy spent about 11.6% less on healthcare compared to those that were not.

How Women Manage Healthcare Spending

In the past, policymakers gauged health progress by making more hospitals and spending more money on health. But women’s empowerment shifts the priorities of family expenditures in different ways:

• Focus on Prevention: Rather than waiting for family members to get sick, women tend to use additional income to reduce future health risks.
• Dietary Investments: Expenditure reduces on prescription medicines and doctor’s visits but improves on quality of nutrition.
• Proactive Wellness: money spent on activities that support long term wellness (physical fitness).

Broader Societal Implications

Directing income to women has a “multiplier effect” on social development.

• Household Decision Making: Research shows that women who contribute to the household income and are responsible for household finances have an increased voice in key household decisions, such as health care and children’s wellbeing.
• Shift to Proactive Health: By focusing on wellness over a longer time horizon, women help their families avoid high out-of-pocket medical expenses.
• Reduced Financial Burdens: Lower healthcare costs mean families have more money to spend on education, savings, and future investments.

Conclusion

Health policy can be successfully used as economic policy. Raising the financial status of women is not only an economic benefit, it also empowers families to make better economic choices, such as focusing on prevention rather than treatment for illness. 

Source: The Hindu

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