Health insurance in India, while a growing segment, has yet to take off fully, and several measures are needed to improve and expand insurance coverage, according to the National Health Profile 2018 released last month.
Around 437 million individuals, or 34% of the total population, had one or the other form of health insurance cover at 31 March 2017, underlining the fact that the number of Indians spending ‘out of pocket’ on healthcare remains significantly high. Among those insured, 79% are covered by state owned insurance companies in the country. Overall, 80% of all persons covered with insurance fall under government-sponsored schemes.
The cost of medical treatment has been increasing in India and it has led to inequity in access to healthcare services, according to the report. Per capita public expenditure on health in nominal terms has gone up from INR621 ($9) in the year ended 31 March 2010 (FY2010) to INR1,112 in FY2016, stated the report. It noted that the centre-state share in total public expenditure on healthcare was 31:69 in FY2016.
The central government plans to increase medical insurance coverage through the National Health Protection Scheme (NHPS), also called Ayushaman Bharat, that aims to provide over 100 million poor families an annual health cover of INR500,000 per family. The scheme is scheduled to be launched next month..
The key challenge with Ayushaman Bharat is in its implementation. Each state must sign a MoU with the central government and share the costs in a 40:60 ratio. However, many states have existing health insurance schemes and some of these are reluctant to merge theirs with Ayushman Bharat. There are also issues with insurance premium, models of implementation etc, reports DNA.
In a note, brokerage Edelweiss said that charges for the procedures listed in Ayushman Bharat are "extremely low and we believe corporate hospitals like Apollo and Max are likely to refrain from empanelment with this scheme". It listed out package rates for Caesarean delivery, total knee and hip replacement, coronary artery bypass and cataract surgery under the government scheme to show industry average rates are significantly higher than what the government proposes to offer. The government has earmarked INR100 billion to spend on Ayushman Bharat in the first year.