Health insurance in India


Health insurance in India is a growing segment of India's economy. The Indian health system is one of the largest in the world, with the number of people it concerns: nearly 1.3 billion potential beneficiaries. The health industry in India has rapidly become one of the most important sectors in the country in terms of income and job creation. In 2018, one hundred million Indian households do not benefit from health coverage. In 2011, 3.9% of India's gross domestic product was spent in the health sector. According to the World Health Organization, this is among the lowest of the BRICS economies. Policies are available that offer both individual and family cover. Out of this 3.9%, health insurance accounts for 5-10% of expenditure, employers account for around 9% while personal expenditure amounts to an astounding 82%. In the year 2016, the NSSO released the report “Key Indicators of Social Consumption in India: Health” based on its 71st round of surveys. The survey carried out in the year 2014 found out that, more than 80% of Indians are not covered under any health insurance plan, and only 18% of the urban population and 14% of the rural population was covered under any form of health insurance.
For the financial year 2014-15, Health Insurance premium was 20,440.

Presentation

The health situation and the provision of services vary considerably from one State to another. Although public health services in principle provide free basic health care to all, the care provided by most state health systems suffers from inadequate resources and poor management. As a result, the majority of the population turns to private health services that offer more expensive care and of very unequal quality.
In India, the health system mixes public and private providers. Public health facilities - local clinics providing basic care, regional hospitals, national hospitals - are funded by the federal states and the federal state and managed by the state authorities.
Public health services differ greatly from one federated state to another. In some states such as Tamil Nadu or Kerala, public health facilities play their role as the first stage of the care journey, but, outside of these few states, the public sector does not reach the goal to provide the basic health needs of the population.
India's public health expenditures are lower than those of other middle-income countries. In 2012, they accounted for 4% of GDP, which is half as much as in China with 5.1%. In terms of public health spending per capita, India ranks 184th out of 191 countries in 2012. Patients' remaining costs represent about 58% of the total. The remaining costs borne by the patient represent an increasing share of the household budget, from 5% of this budget in 2000 to over 11% in 2004-2005. On average, the remaining costs of poor households as a result of hospitalization accounted for 140% of their annual income in rural areas and 90% in urban areas.
This financial burden has been one of the main reasons for the introduction of health insurance covering the hospital costs of the poorest.

History

Launched in 1986, the health insurance industry has grown significantly mainly due to liberalization of economy and general awareness. According to the World Bank, by 2010, more than 25% of India's population had access to some form of health insurance. There are standalone health insurers along with government sponsored health insurance providers. Until recently, to improve the awareness and reduce the procrastination for buying health insurance, the General Insurance Corporation of India and the Insurance Regulatory and Development Authority had launched an awareness campaign for all segments of the population.
Launched in 2007, the National Health Insurance Program is led by the Ministry of Health and was adopted by 29 states in 2014. It is funded 75% by the government and 25% by the states. The worker and 4 of his dependents benefit from health insurance if they are not covered by any system and live below the poverty line. RSBY beneficiaries are required to pay an annual registration fee of INR 30 for hospital coverage up to INR 30,000 per year per family.
September 25, 2018, the Indian government announced the launch of a new health insurance for the poorest citizens. Indian Prime Minister, Narendra Modi announced that the new system is expected to reach more than 500 million people and is called "Modicare". The reform is still in progress and aims to install universal social security in the country.

Structure and organisation

The Indian social protection scheme covers insured persons against risks related to old age, invalidity, death, but also sickness and maternity, unemployment and finally accident at work and occupational diseases
This social protection scheme is not universal and provides only limited coverage, targeting mainly organized sector's workers constituting less than 10% of the population in India. All risks are placed under the supervision of the Ministry of Labour and Employment.
Social security and health insurance is defined by 5 main texts in India:
The Employees' State Insurance Act, 1948;
Employees' Provident Funds & Miscellaneous Provisions Act, 1952;
The Employees Compensation Act, 1923;
The Maternity Benefit Act, 1961;
The Payment of Gratuity Act, 1972;
Social security benefits are mainly managed by: Employees' State Insurance Corporation and Employees' Provident Fund Organisation

Types of policies

Health insurance in India typically pays for only inpatient hospitalization and for treatment at hospitals in India. Outpatient services were not payable under health policies in India. The first health policies in India were Mediclaim Policies. In Year 2000, Government of India liberalized insurance and allowed private players into the insurance sector. The advent of private insurers in India saw the introduction of many innovative products like family floater plans, top-up plans, critical illness plans, hospital cash and top up policies.
The health insurance sector hovers around 10% in density calculations. One of the main reasons for the low penetration and coverage of health insurance is the lack of competition in the sector. IRDA which is responsible for insurance policies in India can create health circles, similar to telecom circles to promote competition.
In principle, government health services are available to all citizens under the tax-financed public system. In practice, bottlenecks in accessing such services compel households to seek private care, resulting in high out-of-pocket payments.
Health insurance plans in India today can be broadly classified into these categories:

Plans funded by central government

Payment options

Under Section 80D of the Income-tax Act the insured person who takes out the policy can claim for tax deductions.
25,000 for self, spouse and dependent children.
50,000/- for parents.