Health financing insufficient




Insurance Regulator and Development Authority of India (IRDAI) Chairman Dr Subhash Chandra Khuntia has urged health insurance companies and healthcare providers to upgrade their standards and adopt ethical practices to provide access, equity and quality services to the people on a sustainable basis.

He was speaking at the 11th Federation of Indian Chambers of Commerce and Industry (FICCI) Health Insurance Conference 2019, on “Health Insurance 2.0: Enabling Change” on 11 Mar 2019 in New Delhi.

Dr Khuntia said access to quality health to majority of the people was essential as currently 62% of the average health expenditure in India is borne out-of-pocket against the world average of 18%.

At the same time, health insurance companies and healthcare providers have to reach out to the uninsured in remote areas and provided facilities at affordable rates to the poor.

Dr Khuntia also emphasised that standardisation of rates and procedures offered by healthcare providers was necessary and for this self-regulation for appropriate treatment was imperative till such time as a regulator for healthcare services was in place.

Towards this end, he advised insurance companies to have a MoU with healthcare providers to keep treatment rates in check. He also suggested that insurance companies could devise technological means to monitor the health parameters of policy holders to check lifestyle diseases such as blood pressure and coronary heart disease. This would go a long way in keeping premiums affordable as also reduce claims from the people at large.

While acknowledging that the life expectancy at birth had risen to 69 years in 2017, he said that achievement of healthy life expectancy was an issue. For instance, the difference among female and male life expectancy and healthy life expectancy was 10.7 years and 8.1 years, respectively. Health insurance companies, he added had a big role to play in bridging the gap.

Dr. Khuntia also suggested that insurance companies could look at covering OPD and preventive care through various incentivisation schemes.

He said that IRDAI had launched a portal listing basic health insurance scheme and products which would be the same for all insurance companies.

He urged all industry to make use of the scheme to take care of the misunderstandings of the provision of services offered to the buyer of an insurance policy.

Dr. Indu Bhushan, CEO, National Health Authority and Secretary, described the health financing scenario as insufficient, inefficient and inequitable.

He said the government spending on health was barely 3.9% of GDP, supporting 29% of the population. The fact that out-of-pocket expenses in availing healthcare accounted for over 60% of total expenditure speaks of the highly iniquitous and regressive form of financing in the country.

Estimates show that over 6 crore people slip into poverty every year because of healthcare costs.

Dr. Bhushan said that the Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (PMJAY) seeks to make healthcare financing more equitable even as he stressed the need for health financing to move to a pre-payment system rather than out-of- pocket spending. The heathy and the rich would have to take the onus of subsidising the unhealthy, elderly and the poor through risk pooling, he said.

Ayushman Bharat, which has completed 170 days since its launch, has benefited 15 lakh people for which Rs.2,000 crore has been provided for. The private sector had stepped in a big way and the coverage is expected to rise to 100 million in the next one year.

Girish Rao, Chair, FICCI Health Insurance Committee; Chairman & Managing Director, Vidal Healthcare, said the challenge before the industry was to find innovative and technological solutions to address the healthcare needs of the people, especially the tech-savvy youth.

Antony Jacob, Co-Chair, FICCI Health Insurance Committee and Chief Executive Officer & Whole Time Director, Apollo Munich Health Insurance, underlined the need to meet the rising expectations of the consumers looking for convenience and an enriching experience. For this, industry would need to embrace Artificial Intelligence across their operations to make the consumer experience seamless.


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