Health Portability Issues in India

By: Minali Mehra

What is health?
y Health means the absence of disease. y Health means a relative state in which one is able to function

well physically, mentally, socially, and spiritually in order to express the full range of one's unique potentialities within the environment in which one is living.

Definition
y In the words of Ren Dubos, Health is primarily a measure

of each person's ability to do and become what he wants to become.

Meaning of Health Insurance

y Health insurance can be defined in very narrow sense where

individual or group purchases in advance health coverage by paying a fee called "premium".

Health Insurance Portability

y Health Insurance Portability is that allows you to shift from

one health insurance provider to another, without having to lose any of the benefits that your current health insurer provides.

Health Insurance Portability Issues in India

Lack of awareness. b. Low level of income. c. Rising Inflation. d. Family size e. Number of private players f. Pay First and then reimbursement g. Few number of registered hospitals h. Lack of medical facilities in rural areas
a.

Health Insurance Portability Issues in India

Delay in treatment k. Delay in reaching hospital l. Minor illness becomes a root cause for major diseases m. No effective guidance by Doctors, medical Practioners. n. No Enforcement made by either Government or any one else.
j.

Health Insurance Portability Issues in India

o. Lack of maternal facilities in rural areas n. No effective initiatives taken yet p. No proper facilities in rural areas r. Hesitation in visiting doctors s. Few number of Doctors in villages t. High fee charges by private hospitals u. Affordability

Need of Health Insurance Portability

y To improve service and delivery in the insurance industry. Thats why

y y

the Insurance Regulatory and Development Authority (IRDA) decided to allow health insurance portability. Many of times employees shifting from one organization to another organization many times lose health insurance cover due to lack of portability of the health insurance policies. It is essential to protect the policyholders against discontinuity and consequential loss of Pre Existing Diseases (PED) cover by making the health insurance plans portable across the insurance companies." The portability feature will allow the policyholder to shift from one insurer to the other without the fear of losing the cover of PED. In India it is a new concept only about 2 per cent of total health expenditure is funded by public/social health insurance while 18 per cent is funded by government budget.

Classification of health coverage plans

y Based on ownership the existing health insurance schemes y y y y

can be broadly divided into categories such as: Government or state-based systems Market-based systems (private and voluntary) Employer provided insurance schemes Member organization (NGO or cooperative)-based systems

Government based systems

y This includes Central Government or state-based systems

Health Scheme (CGHS) and Employees State Insurance Scheme (ESIS). It is estimated that employer managed systems cover about 20-30 million of population. The schemes run by member-based organizations cover about 5 per cent of population in various ways.

Market-based systems
y Market-based systems (voluntary and private) have Mediclaim

scheme which covers about 2 million of population. There are many employers who reimburse costs of medical expenses of the employees with or without contribution from the employee.
y It is estimated that about 20 million employees may be covered

by such reimbursement arrangements. There are several government and private employers such as Railway and Armed forces and public sector enterprises that run their own health services for employees and families. It is estimated that about 30 million employees may be covered under such employer managed health services

Employer provided
Employee State Insurance (ESI) Scheme
Under the ESI Act, 1948 ESI Scheme provides protection to employees against loss of wages due to inability to work due to sickness, maternity, disability and death due to employment injury. It also provides medical care to employees and their family members without fee for service.
Table 2 Existing infrastructure under ESIS in India Particulars No. of Centers No. of Insured Persons/Family Units ESI Hospitals Number of ESI Hospital Beds ESI Dispensaries Insurance Medical Officers Insurance Medical Practitioners 632 84,45,000 125 23,334 1,443 6,220 2,900

Member organization (NGO or cooperative)-based systems

There are some efforts in this direction of providing social

security to the poor by a few NGOs. The most prominent among them is that of Self-EmployedWomen's Association (SEWA).
The other scheme by government insurance companies

developed to focus on poor is called Jan Arogya Bima Policy which was introduced in 1995 and covers expenditure up to Rs. 5000 for a premium of Rs. 70 per annum.

Companies engaged in

have various health insurance products.

Few Health Insurance plans

y By Life Insurance Corporation of India
y Ashadeep Plan II y Jeevan Asha Plan II

By General Insurance Corporation of India

 Personal Accident Policy,  Jan Arogya Policy,  Raj Rajeshwari Policy,  Mediclaim Policy,  Overseas Mediclaim Policy,  Cancer Insurance Policy,  Bhavishya Arogya Policy  Dreaded Disease Policy

Few Private Players Companies engaged in

y y y y y

Bajaj-Allianz Tata-AIG ICICI-Prudential MetLife Birla Sun Life etc.

FUTURE PROSPECTS OF HEALTH INSURANCE IN INDIA

y Indian health care industry is now worth of 96,000 crore and y y y y y

expected to surge by 10,000 crore annually. 315 Million people are estimated to be insurable and have capacity to spend 1000 as premium per annum. Many global insurance companies have plans to get into insurance business in India. Market research, detailed planning and effective insurance marketing is likely to assume significant importance. Health Insurance has a wider scope in present day situations in India. Requires Careful and Significant Effort To tap Indian health insurance market with proper understanding and training.

Future prospect of health insurance in India

Country Social Governme Health nt Insuran Budget ce 37 20 31 23 2 2 36 33 13 10 20 18

y Percentage of total health

Algeria Bolivia China Korea Vietnam India

expenditure funded through public/social insurance and direct government revenue Country Social Health Insurance Government.

Source: As cited in Naylor et al. 1999.

y FUTURE PROSPECTS OF HEALTH INSURANCE IN INDIA

y The health care demand is rising in India now days. It is estimated

y y

y y

that only 10 per cent of health insurance market has been tapped till today. Still there is a scope of rise up to 35 per cent in near Mediclaim scheme:The government insurance companies started first health insurance in 1986, under the name mediclaim; thereafter Mediclaim has been revised to make it attractive product. Mediclaim is a reimbursement base insurance for hospitalization. It does not cover outpatient treatments. Employee State Insurance (ESI) Scheme:Under the ESI Act, 1948 ESI Scheme provides protection to employees against loss of wages due to inability to work due to sickness, maternity, disability and death due to employment injury. It also provides medical care to employees and their family members without fee for service.

From Consumer and social perspective

y With the liberalization of insurance and entry of private companies

in this business it is very important that specific interventions are developed which focus on increasing the consumer awareness about insurance products. One of the major challenges after privatization of insurance would be how to develop such mechanisms, which help making consumers aware about the various intricacies of insurance plans.

Health Care System

y health care system an organized plan of

health services. The term usually is used to refer to the system or program by which health care is made available to the population and financed by government, private enterprise, or both.

Elements OF A Health Care System

y (1) PERSONAL HEALTH CARE SERVICES for individuals and

families, available at hospitals, clinics, neighborhood centers, and similar agencies, in physicians' offices, and in the clients' own homes.
y (2) The Public Health Services needed to maintain a healthy

environment, such as control of water and food supplies, regulation of drugs, and safety regulations intended to protect a given population.
y (3) Teaching And Research Activities related to the prevention,

detection, and treatment of disease.

y (4) Third Party Health Insurance coverage of system services.

Steps taken by IRDA

y Initiatives have been taken by controlling authority

IRDA. IRDA has allowed them portability -- shifting policies from one insurer to another on same terms from 1st July." y The Authority has examined various issues involved in the portability of health insurance plan and has issued necessary orders for effecting portability which will be implemented from July 01, 2011,. y IRDA has directed insurance companies to mention in the prospectus and sales literature that all health insurance policies are portable.

Steps taken by other companies

y Today there are 24 general insurance companies, including ECGC

and Agriculture Insurance Corporation of India and 23 insurance companies operating in the country.

y The insurance industry is a large and growing at a rapid rate of 15-

20%. All banking services, add insurance, 7% of GDP. An insurance industry is well developed and a boon to economic development, providing long-term funds for infrastructure development and strengthening of the capacities of the developing threat to the country.

Employee State Insurance (ESI) Scheme

y Employee State Insurance (ESI) Scheme y Under the ESI Act, 1948 ESI Scheme provides protection to

employees against loss of wages due to inability to work due to sickness, maternity, disability and death due to employment injury. It also provides medical care to employees and their family members without fee for service.

Suggestions
a. b. c. d. e. f. g.

IRDA has to come forward and take necessary steps. Awareness need to created through by advertisement any other mode of communication. Compulsions made by Government like wise in developed countries. Insurance company has to follow proactive measures. Different promotional activities must be conducted. T.V, news paper, suggestions by Doctors could be very effective. Try to reach in rural areas.

conclusion
y As of now information, knowledge and awareness of

existing insurance plans is very limited. Health insurance is typically annual and has to be renewed yearly to avoid problem of lapse of a policy. Even Courts have ruled that even if there is delay in renewing the policies it should be considered as renewed policy. Now few National and International Organization covering 65% of Total Health Insurance Policy.

Bibliography

ywww.irda.gov.in ywww.google.com ywww.investorwords.com ywww.businessstandard.com ywww.financialexpress.com

Thank you.