Health systems
Health insurance for the poor in India
How well developed is health insurance in India?
Authors:
R. Ahuja
Publisher:
Indian Council for Research on International Economic Relations , 2004
In general, health insurance is not well developed in India. A major part of total health spending in the country takes the form of private, out-of-pocket spending which is clearly regressive in nature. This paper by ICRIER argues that community based health insurance (CBHI) is more suited than alternate arrangements to providing health insurance to the low-income people living in developing countries. The universal health insurance scheme, launched recently by the Prime Minister of India, is only one of the forms that CBHI can take. While analysing the proposed scheme, the authors examine alternate forms of CBHI schemes prevalent in the country.
The authors argue that the development of private health insurance markets in the country will not leave the poor unaffected. Insurance sector reform can affect poor people through its effect on the provision of health services (i.e. cost, quality and access) used by the low-income people as well as through its access to financing of health care. The paper explores how insurance sector reforms alter health insurance prospects facing poor people in India, and what changes on the health front affecting the poor have happened or are likely to happen as a result of insurance sector reforms. It is concluded that in the diverse settings of India all forms of CBHI have a role to play and therefore need to be encouraged by the government through appropriate interventions. Formal insurance providers can also be reigned to serve low-income populations. At the same time, developments in formal health insurance markets need to be guided so as to minimise cost escalation of health care provision.
[adapted from the author]
