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May272009
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Cost of Living
The young doctor on duty ordered the mandatory X-rays and discovered more than one broken bone. He consulted the orthopedic surgeon on call, who advised immediate surgery and suggested that the patient be prepared for this while he arrived. In due course, after the patient was administered pr anesthetic procedures, the surgeon arrived. But just as he was about to begin, a messenger rushed in from the Billing Section to inform that the cash deposit paid on arrival was insufficient and the operation could not begin till an adequate advance was paid.
It was midnight and the wife was in a fix. Her husband was lying on his surgical table, the surgeon was waiting to start but money was short. The amount of money required was not available at home, the ATM would dispense would only a limited amount; and so the only way finally was to phone all of her office colleagues living in the area and some how take up a collective offering. The money deposited, the surgery finally took place after a harrowing wait of close to two to three years.
After recovering the ordeal, the family has become one of the most strident advocates of health insurance, which they did not have as they were entirely dependant on medical reimbursements offered by their employers. Of course the family hardly lacks company. According to National Council of Applied Economic Research (NCAER), health insurance penetration in India stands at a dismal 1.2 percent. On a macro level, very few households in India have contingency plans to meet their health expenses. Health risks in India are perceived differently than the western population. Prior planning in health issues is yet to be a major priority.
Without an aggressive thrust on insurance, things can only get worse. India is the most privatized health market in the world. Public support for healthcare has been historically low in India, averaging less than 1 per cent of the GDP, but what is worse is that in the last decade public health investment and expenditure has seen a secular declining trend.
The poor have to increasingly resort to taking debt or selling assets to meet costs of hospital care. It is estimated that 20 million people each year fall below the poverty line because of indebtedness due to healthcare. This is worrisome given the fact that more than two-thirds of the country’s population is already either poor or living at subsistence levels
There are a couple of reasons that Health insurance has not taken off a great deal in the country. Firstly, unlike life insurance, which is marketed in India, largely as an investment product , the value o health insurance kicks in only if and when one is seriously ill ; or else the premium is paid is seen as a waste of money. In some places, talking explicitly about illnesses and planning to deal with them is considered a sure fire invitation to sickness and an ill omen. So with al these complexities, the private insurance industry in India is still at a nascent stage and growing. To date, only approximately 20% of the total insurable population of India is covered under various life insurance schemes. Let us hope that the health insurance industry will not exploit this market but also educate it about the social net that health insurance can provide.
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