A white paper released here on the health insurance scenario in the country has made several recommendations, including a dedicated regulator for the sector, reduction in premium and collection costs and learning from the experience of public-private models, to help broadbase the reach of health coverage policies.
The recommendations, compiled by PricewaterhouseCoopers (PwC), is an outcome of a roundtable meeting held in January covering industry leaders from insurance and healthcare sectors besides government officials. These recommendations would be submitted to the Insurance Regulatory and Development Authority (Irda) this week, according to Sujay Shetty, leader-Pharmaceutical & Life Sciences, PwC India.
“The healthcare sector is one of the largest and critical-to-people sector. The information asymmetry and the human sensitivity only adds to the complexity. A regulator for healthcare is required now more than earlier as more and more individuals start shifting the onus of financial burden to insurers, who are demanding processes, quality and consistency from hospitals,” the white paper said.
Elaborating on these and other recommendations, Ranga Iyer, a healthcare consultant, said the regulator for the sector could be a part of the present Irda setup.
Companies need to devise new business models and multiple models of insurance products tailor-made for below poverty line (BPL), middle and upper middle class to create the demand for health insurance products.
“Given India’s broad division into three segments — those living below poverty line, the middle class and the upper class — it would be better if India followed a three-tier model since a one-size-fits-all model won’t work well in health insurance. Government, private and public private partnerships would suit all the three tiers to meet the needs of different population segments,” the white paper said.
One of the problems contributing to the ever-increasing premiums of health products is lack of reliable data pertaining to the history of insured persons. To overcome this, the paper suggested setting up of a separate credit bureau on the lines of Credit Information Bureau (India) Limited that was set up for banks and housing finance companies.
According to Iyer, insurance companies can study the community health insurance programmes being successfully implemented in states like Tamil Nadu and Andhra Pradesh to increase rural penetration. Motivating youth to subscribe to health insurance products, making health coverage mandatory for private sector employees are some of the other suggestions.
Though the health insurance sector plays a pivotal role in improving access to healthcare around the world, less than 15 per cent of India's population is covered under some form of health insurance, including government supported schemes. Of this, around 2.2 per cent is covered under private insurance with rural health insurance penetration less than 10 per cent, according to the paper.
