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Business News/ Money / Personal Finance/  Medical inflation in India reaches alarming rate of 14%, reveals report

Medical inflation in India reaches alarming rate of 14%, reveals report

Healthcare costs in India are rising rapidly, and many employees are unable to afford coverage. Employers need to do more to support their employees' health and well-being.

India has one of the highest medical inflation rates in Asia, reaching 14 percent.

A recent report by insurtech company Plum titled "Health Report of Corporate India 2023" has shed light on the health of India's workforce. The study revealed that India has one of the highest medical inflation rates in Asia, reaching 14 percent.

This rise in healthcare costs has placed a financial burden on employees, with 71 percent personally covering their healthcare expenses. Unfortunately, only 15 percent of India's vast workforce receives health insurance support from their employers.

The report found that the burden of healthcare expenses is disproportionately affecting over 90 million individuals, with costs exceeding 10 percent of their total expenditure.

India's employment landscape is expected to grow significantly, from 522 million individuals in 2022 to an estimated 569 million by 2030. Despite this growth, only 15 percent of this vast workforce receives any health insurance support from their employers, as revealed by a Niti Aayog report. Meanwhile, adoption of employer-sponsored healthcare plans is significantly lower among young adults aged 20-30 compared to older employees aged 51 and above. This disparity is evident, with the adoption rate for younger employees being only half that of their older counterparts, said the Plum report.

In addition, a substantial portion of employees across all age groups, approximately 42%, have expressed a desire for the availability of "flex benefits," which would allow them to customise their healthcare plans to better suit their individual needs and preferences.

The report also highlighted that only 12 percent of companies provide telehealth support and less than 1 percent offer outpatient coverage.

This lack of support is particularly concerning for the 85 percent of employees with chronic illnesses who do not feel supported by their employers and less than 5 percent of companies provide comprehensive healthcare options to their employees, including insurance, telehealth, and other benefits.

“An average person spends 90,000 hours working. That’s almost a third of their life. Employee health should be a top priority for organisations, not only from a humanitarian perspective but also as a strategic investment in their workforce. Hence, just health insurance is not enough," said Saurabh Arora, Co-founder and CTO, Plum.

The report also underlined concerning figures regarding annual health checkups and regular doctor consultations. Nearly 59 percent of individuals skip their annual checkups, and 90 percent neglect regular consultations to monitor their health.

These statistics raise concerns about the long-term consequences for individual well-being and overall health outcomes.

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ABOUT THE AUTHOR

Deepika Chelani

A business media enthusiast. She covers the markets and personal finance beat for LiveMint.
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