Health Insurance
1
Global scenario in health care financing
Sustainable Development Goals (SDGs), emphasizes upon Universal health
coverage (UHC), which includes availability, accessibility, and affordability of
quality healthcare services to the residents without any financial risk (Reich et al,
2016).
Low and middle-income countries (LMICs) are using the healthcare services by
paying from Out of Pocket Expenditure (OOPE), resulting into financial
catastrophe and impoverishment (Li et al., 2012).
Millions of people are unable to use health services, as they have to pay for
them while availing these services (WHO, 2016).
The lower income group people resort to private borrowings to finance poor
health outcomes, especially for inpatient care (Peter’s et al., 2002).
Unnecessary financial burden of health care expenditure may adversely affect
their economic wellbeing (Petersen, 2008).
2
Health financing models across world
3
Status of healthcare financing in India
Higher burden of prevailing communicable disease (CDs), along with NCDs and
injuries (Pradhan et al., 2017) will further push the cost curve higher especially for
poor's.
Approximately 3.5% of the population fall the below the poverty line and 5%
households suffer CHE due to unaffordable health cost (Shahrawat and Rao, 2011).
Around 67 % of all health expenditures in India are borne directly by the people,
making it one of the most highly privatized healthcare systems of the world (NHA,
2017).
Reducing OOPE through insurance coverage is a major challenge especially for the
country like India (Xu et al., 2003).
There are evidences of regional concentration of the health spending among the
high income states(Dwivedi and Pradhan, 2017).
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Some recent evidences-NHA, 2017
Revenue of healthcare fiancing
80% 71%
70%
60%
50%
40%
30%
20% 13.30%
8.20% 6.80%
10% 0.70%
0%
Household revenue for state government funds union government funds other revenues Local bodies
financing
Health care financing
80%
70% 67%
60%
50%
40%
30%
20% 11.70%
10% 3.80% 7.00% 3.90% 5.10%
1.50%
0%
Household OOPE State government Govt. Health Union government Private Health Local bodies Other schemes
insurance Insurance Schemes
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NHA, 2017
Healthcare providers and function wise distribution
Healthcare providers
35.00%
30.00% 28.90%
25.90%
25.00%
20.00%
14.30%
15.00%
10.00% 6.80%
5.30% 4.60% 4.70% 5.30%
5.00% 2.60% 1.60%
0.00%
Govt Privatee Govt Private Pharmacies Patient Diagnostic preventive Admin. Others
Hospitals Hospitals Clinics Clinics transport lab care Agencies
Health Care Functions
40.00%
35.10%
35.00%
29.00%
30.00%
25.00%
20.00% 16.20%
15.00%
10.00% 6.70%
4.60% 4.70%
5.00% 1.20% 2.60%
0.00%
Outpatient Inpatient Preventive care Other Pharmaceuticals Patient Lab and Governace and
curative care curative care Fucntions and other Transportaion imaging admin
medical goods
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Healthcare financing: efficiency vs. equity
Healthcare
financing Equity Vs. Efficiency
mechanism
Efficient financing
Equity Efficiency
mechanism
Equitable healthcare Allocative efficiency
Generates large
financing system: Technical
amount of funding
Cross-subsidies from efficiency
and
the rich to the poor and Removes the need
From healthy to the for multiple funding
ill mechanisms