Opinion
Healthcare for all: Don’t rely on insurance alone
Summary
- Health insurance in India serves a vital purpose and the government’s push to ease claims is welcome. For equitable outcomes, however, India should gradually shift its welfare emphasis to high-quality public services. It may offer an actuarial advantage too.
For many who’ve had the misfortune of having to invoke health-insurance coverage, the difficulty of it is what stays embedded in memory. Don’t get us wrong. The concept, in itself, is excellent. But the process of getting claims met and the suspense over what part may have to be paid from one’s own pocket are sources of anxiety in need of relief, especially when it adds to the distress of a medical crisis in the family.
So, it counts as good news that India’s government is taking further steps to ease the formalities. As reported by Mint, it plans to make it mandatory for health insurers to approve valid cashless treatment requests within an hour and final claim settlement requests within three. The latter should help relieve patients who are fit for discharge from hospitals but are kept waiting till the bills are settled. The delays are such that tales abound of patients feeling like hostages, with their cannula insertions held in place till the last rupee is paid.
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For those who do not have the benefit of cashless claims—in which hospitals take care of the details—the government promises to standardize application forms. Plus, the National Health Claims Exchange, an online platform designed to smoothen the processing of health claims by insurers, is to be strengthened.
All this runs alongside the Pradhan Mantri Jan Arogya Yojana (PM-JAY), a government-funded scheme that assures hard-up households a health-insurance cover of ₹5 lakh. The Centre recently expanded its coverage to all citizens aged over 70, regardless of economic status. For multitudes who can’t afford private hospitalization for a health emergency, the PM-JAY is an important enabler. It also prevents healthcare burdens from pushing families into poverty or debt, thereby serving a broad economic purpose.
An Indian School of Business study has shown decreased health-related borrowing, reduced precautionary savings and improved loan-repayment by borrowers, thanks to PM-JAY. Insurance is crucial in a scenario of high healthcare inflation, which tends to outpace the general cost of living in India.
Also Read: PM-JAY: A successful model for both healthcare delivery and financial security
As estimates suggest, charges for medical attention have been rising in double digits annually. This is reflected in the health insurance premiums we pay, which have almost doubled over the past four years or so. And then there are many Indians who lack any sort of coverage.
Policy-wise, we must not let the larger issue at stake get side-tracked. India has yet to take a clear call on its long-horizon path towards the goal of health for all. Reliance on insurance reveals a preference for the US model, which features a huge market of expensive private services backed by fee-charging insurers.
However, the law of large numbers that enables businesses to profit from risk pooling works even better if health risks are taken on directly by a national service. In theory, wider actuarial data makes space for lower costs. In essence, this is the European welfare model, with the state offering everyone high-quality care that’s either free or heavily subsidized.
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With India’s public health services derelict at best, barring our top-bracket institutes, welfare has taken an indirect approach that may prove too patchy and costly as we go along.
We should gradually shift our focus from state-paid insurance to state-provided healthcare that rivals private-sector quality. A public health infrastructure upgrade would serve a broader purpose too. After all, as with education, equal access to healthcare is key to an equitable society.
