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Thinking of Health Insurance beyond OOPs


Thinking of Health Insurance beyond OOPs

Future Health Systems

By Manasee Mishra, FHS India Coordinator, IIHMR University, India


Use of health care services is marked by high out-of-pocket payments (OOPs) in many countries. Patients and their caregivers have to pay for various expenses, including consultation charges, drugs, diagnostic tests and inpatient admission costs. Providing health insurance cover to the poor is often considered a means to provide protection against financial risk and the impoverishing effects of catastrophic health expenditure. The goal of Universal Health Coverage (UHC) seems attainable when poor people are insured for health care expenses.

OOPs dominate the discourse on health insurance. The success of health insurance schemes is typically measured by whether such expenses decrease for the insured. Financial hardships can indeed significantly hinder access to health care. But other barriers exist within households and across social groups that can also restrict access to health care. Health insurance schemes can improve such situations and enhance access to health care. While they are well recognised for their potential to offer financial risk protection, their ability to promote equity in other ways is not as well understood. This blog draws from a recent presentation at the Fifth Global Symposium on Health Systems Research (HSR2018) to highlight how inter- and intra-household equity can be promoted through health insurance schemes for the poor. Empirical evidence from the Rashtriya Swasthya Bima Yojana (RSBY) - a state funded health insurance scheme for the poor in India – is cited to make the case.

Improving Access to Health Care Within and Across Households

The household is a site of inequity with unequal distribution of power and resources among its members. Decisions on health care seeking and spending are made by the powerful within the household. This is especially true in events like hospitalisation, which are costly, time-consuming and can mean loss of wages for patients and their caregivers in poor households. The RSBY has shown potential to cut through such household level power asymmetry. We found that the households with active RSBY cards had a higher hospitalisation rate for members with disabilities. The hospitalisation rate for members schooled up to primary level was also higher in such households. In contrast, the hospitalisation rates were lower for such members in the households without (active) RSBY cards.

The RSBY has been able to overcome other structural constraints operational in Indian society. India is a multicultural country with different social groups coexisting. The hospitalisation rates vary widely for members of different communities in the country. It is lower for Muslims compared to Hindus and Christians. It is lower than the national average for the Scheduled Castes, and lowest for members of the Scheduled Tribes. Our study showed that this pattern is not repeated in the households with active RSBY cards. Rather, the hospitalisation rates are similar for different religious groups. Members of the General Castes, the Scheduled Castes and the Scheduled Tribes also have similar hospitalisation rates in such households.

Equity Promotion Beyond Financial Risk Protection

Health insurance schemes such as the RSBY are measures to promote equity through financial risk protection for the poor. It is encouraging that these measures can advance societal equity in other ways too. India is home to the largest number of the world’s poor. Currently, the Government of India is rolling out the National Health Protection Mission (NHPM) - considered to be the largest state-funded health insurance scheme in the world. The scheme is expected to benefit 40% of India’s population (approximately 500 million people). The NHPM shall subsume the RSBY and plug some of its operational deficiencies. Under the new scheme, the insurance cover offered to enlisted households shall be more than 16 times the cover offered under the RSBY. The inter- and intra-household equity promoted by the RSBY can be replicated at scale under the NHPM, making the goal of UHC so much more attainable.