Final project on health insurance

TYBBI

HEALTH INSURANCE

INTRODUCTION OF HEALTH INSURANCE India is the first largest country in terms of purchasing power parity and is considered one of the fastest emerging economics in the world. However, its health status remains a major concern. Infant mortality rate of India is as high as 54.6 while it is around 23 for China. Similarly life expectancy at birth for India is around 64.7 while it is in the range of 77.80 for many countries. Insurance generally comprises of life and non-life (general) insurance. Health Insurance in India comes under general insurance. The development of health insurance in India therefore, has to be seen in the backdrop of the development of insurance in general. Healthcare, with global revenue of over Rs. 2.75 trillion is the largest industry in the world. The nation of India with a population of 1000 million experiences a vast inequity that exists in the healthcare industry with barely 3 percent of the population covered by some form of health insurance, either social or private. Health insurance schemes are increasingly recognized as preferable mechanisms to finance health care provision. The option of insurance seems to be promising alternatives as its pools and transfers risk of unforeseeable health care costs for a pre-determined fixed premium. We do not social security system, appropriate Health Insurance Schemes

for

different

sections

of

the

society

particularly

underprivileged and the poor is an urgent need of the hour. Insurance penetration being very low and health insurance’s share being T.Y.B.B.I

1

TYBBI

HEALTH INSURANCE

minimal in the existing situation, the vast majority of the populations are outside the existing Health Insurance System. With the opening up of the insurance market for private entry and the accompanying hype it is being hoped that in the days to come, the teeming population of India can look for health coverage from an array of insurance providers that too at an affordable price. The present series on health and group insurance therefore attempts to trace the significance of health insurance and its basic tenets in preserving the economic value of the lives of the citizens.

T.Y.B.B.I

2

TYBBI

HEALTH INSURANCE

ORIGIN OF HEALTH INSURANCE The concept of health insurance was proposed in 1964 by Hugh the Elder chamberlen form the Peter Chamberlen family. In the late 19 th century, early health insurance was actually disability insurance, in the sense that it covered only the cost of emergency care for injuries that could led to a disability. This payment model continued until the start of the 20th century in some jurisdictions (like California), where all laws regulating health insurance actually referred to disability insurance. Patients were expected to pay all other healthcare costs out of their own packets, under what is known as the fee for-service business model. During the middle to late 20th century, traditional disability insurance evolved into modern health insurance. It is not an easy task to regulated health insurance. Some countries including the US had to launch war-like operation to unearth large scale frauds. Malpractices in health Insurance range from excessive billing to exaggerating severity of hospital patient conditions. In India, “Health Insurance is not of recent origin. Concern for loss resulting from accident and illness can be traced to ancient civilizations. In fact, one of the earliest forms of health insurance may have been based on the ancient custom of paying the doctor while in good health and discontinuing payment during periods of illness. This custom existed in South East Asian countries including India. The

T.Y.B.B.I

3

TYBBI

HEALTH INSURANCE

development of health insurance in existing form in India is based on pattern followed in Europe and America. Health Insurance or medical insurance schemes had developed in India due to industrial relations problems between the employer and the employees. The Corporate Houses used to offer core and non-core benefits to the employees. The insurance policies were granted to large Corporate Houses purely on an accommodation basis. The cover usually offered to the employees was in the nature of hospitalization and domiciliary treatment for dental and non-surgical eye treatment. The benefits used to be for very small amount. There was no scheme for individuals and families. In 1981, the Apex Body of Public Sector Insurance Companies i.e. GIC designed a limited cover for individuals and families for covering their hospitalization needs. This was replaced by a mediclaim policy in the year 1986 under a market agreement to provide insurance benefits to individuals and groups under a group mediclaim policy. The scheme so introduced was modified in 1991 and 1996 in the light of experience and suggestions received from the insuring public and medical fraternity. The benefit provided under the policy was on reimbursement basis on occurrence of a major calamity in the form of accident/sickness to an insured person.

The first Mediclaim Insurance Scheme was introduced by GIC in 1986 for people not covered under the above scheme. Prior to 1986,

T.Y.B.B.I

4

TYBBI

HEALTH INSURANCE

cover against sickness and diseases were provided by extension of Personal Accident Policy. It is interesting to note that even after nearly two decades of health insurance, the population covered by health insurance is only 1% of the total population.

T.Y.B.B.I

5

TYBBI

HEALTH INSURANCE

MEANING AND DEFINITION Health insurance insures you and your family against sudden medical expenses. A medical emergency can arise due to sudden illness or injury. With medical expenses rising, a health insurance policy would help you sail through a bad patch. Your medical expenses will be taken care of by the Insurance company provided you pay your premium regularly. World health organization defines health as complete physical, mental and social well being and not merely the absence of disease and injury. As per WHO, a country’s Health Systems comprise of all the organizations, institutions and resources that are devoted to produce health actions. New India Assurance Company Limited, stressing on the social security aspect of health insurance, in their written note, stated; “Basically the philosophy behind the concept of Health Insurance is to provide protection against uncertainty of illness /accident by spreading the risk based on the principle that “what is highly unpredictable for an individual is predictable for a group of individuals. Thus, insurance is a system by which Healthcare expenditure of few unfortunate individuals, who suffer from illness/injury, is shared by many fortunate ones who are insured and exposed to the same risk but remain healthy.”

T.Y.B.B.I

6

TYBBI

HEALTH INSURANCE

Oriental Insurance Company, emphasizing the financial security aspects of health insurance, in their written note, stated; “Health insurance is a financial mechanism that exists to provide protection to individuals and households from hospitalization expenses incurred as a result of unexpected illness or injury. Under the mechanism, the insurer agrees to compensate or guarantees the insured person against loss by specified contingent event and provide financial coverage for which the insured party pays a premium. The case for health insurance rests on three grounds: a) Illness can not be predicted; b) Financial burden of hospitalization is high and cannot be planned; c) The proportion of people requiring hospitalization due to illness or injury in any large population is small thus enabling risk pooling. Pooling of risks, resources, and benefits is the hall mark of any insurance system.

T.Y.B.B.I

7

TYBBI

HEALTH INSURANCE

NEED FOR HEALTH INSURANCE Health insurance has become a necessity today because it plays a major role in health care. This is because one never knows when illnesses may strike. And in such cases hospitalization and medication expenses can be unaffordable. Health insurance can prove to be a source of support by taking care of the financial burden of your family may have to go through. Advancement in science and technology has brought about a revolutionary change in mans life. It has reduced mortality rates and increased his life span but at the same time has given rise to a number of other ills. Increasing pollution levels especially in metros, stress and strain at workplace, cut throat competition taking its toll are some of the harsh realities. Pollution levels in certain areas are unimaginably high and the areas are nothing short of gas chambers. An individual going to his place of work has to spend long hours in queues, inhaling the vehicular emissions of poisonous carbon monoxide gases affecting his health in the long run. Besides accidents on roads are common features. In such instances timely affordable medical help is the need of the hour. But this may be easier said than done. Treatment for major illnesses or accidents can be unaffordable and may leave you poorer by thousands of rupees.

T.Y.B.B.I

8

TYBBI

HEALTH INSURANCE

It is especially worse when the patient needs specialized care. Expenses are exorbitant and the situation leaves you mentally devastated also burning a deep hole in your pocket. The family balance is affected, all those comforts of life have to be given up and your family has to make up with bare minimum necessities only. Health insurance takes care of you in such circumstances. It will help you tackle such situations with ease by providing you with timely and adequate medical care. The financial burden of footing huge medical bills is taken care of by health insurance. Besides if the accident causes life long disability to the patient, the earning member of the family, the insurance company will come to the rescue. Primary health care - a basic necessity and right of every individual, is today only a distant dream. The government has done precious little in this regard for the masses and hence the private sector has taken up the challenge to exploit the potential of the 92,400 crore healthcare industry. With educational levels going up people are becoming increasingly aware of the need of timely healthcare facilities. But at the same time the high costs of private health care is a major deterrent. The need of the hour is affordable health care for all in order that even the people in remote villages can have access to it.

T.Y.B.B.I

9

TYBBI

HEALTH INSURANCE

INDIAN SCENARIO In India, presently the health insurance exists primarily in the form of Mediclaim policy offered to the individual or to any group, association or corporate bodies. The government spending is less than 25 percent against the average spending of 30-40 percent in other developing countries. There is need for regulation for the self-funded health plans by major employers who may not find insurance as a cost effective alternative. According to WHO figures (2002), total health expenditures represent 6.1% of India’s GDP, but most of this amount, representing 4.8% of GDP is the share of private expenditures and only 1.3% of GDP is public expenditure. Of the 4.8% private expenditure, 98.5% are out-of-pocket spending of users. In other words, 77.5% of total expenditure for health care costs is paid by individuals or households (WHO, 2005) and this huge expenditure does not pass through any pooling mechanism. Access to health care in India is still low and with only less than 1% of GDP allotted to public health, there is lack of adequate health infrastructure. Penetration of Mediclaim is currently done by state-owned insurance companies, covering only about 2.5 million people i.e. less than 0.50 percent of the country’s population. There are some health insurance schemes issued by four public sector general insurance companies, namely, National Insurance Company Limited (NICL), New India Assurance Company Limited (NIACL), Oriental Insurance Company Limited (OICL) and United India Insurance Company Limited T.Y.B.B.I

10

TYBBI

HEALTH INSURANCE

(UIICL). Besides these four companies, Life Insurance Corporation (LIC) of India also offers a few health covers in a limited manner. At present, 82.44% of the entire commercial health insurance business in the country is shared between public companies, while private firms manage the rest 17.56%. Paradoxically, the medical professionals are resisting standardization in treatment coding known as ICD and cost cutting measures for making the medical treatment affordable to the ailing. They tend to forget that that future growth of healthcare in a country like India would depend upon the development of health insurance model. The need for support from the health domain members/players and the ministry of health both at the centre and the state cannot be overemphasized. However given the state of affairs of regulations in the healthcare sector in India, it is doubtful whether full fledged insurance companies would like to take healthcare risks manageable so that insurers may find it worthwhile to move into the sector in a big way.

T.Y.B.B.I

11

TYBBI

HEALTH INSURANCE

ISSUES AND CONCERNS All over the world, insurance coverage is being extended through 3 basic models: i) public financing and public delivery as practiced in the UK until its recent reforms, ii) private financing and public delivery as the model practiced in the US, Singapore, and Taiwan and iii) public financing and private delivery as the Bismarck model, idealized national (public or social) health insurance scheme practiced in Canada, Germany, France, Japan and China. Health care insurance is one such alternative that covers the risk of payment for health care. William C Hsiao (1992) of the Harvard University undertook a comparative study of the three models and concluded that "public financing and private delivery" of health care as practiced in Canada is the best among the 3 models in terms of performance, health outcome, public satisfaction and access to health. There is however, a school of thought that doubts the suitability of this model to Indian conditions on the grounds that: i. The size of the population is far more than any of the countries where it is being currently practiced efficiently. ii. The level of the per capita income is far lower than in other countries. iii.The type of federal set up India has is different from the rest. True, these apprehensions cannot simply be shunned off but one redeeming feature of the Indian system is that it has the necessary T.Y.B.B.I

12

TYBBI

HEALTH INSURANCE

infrastructure - sizeable public hospitals, not-for-profit voluntary organizations plus highly skilled professionals in different kinds of medical services and decades of experience in managing insurance business. What is therefore needed is a better link-up of these available resources with the ordinary consumer at an affordable price. With the opening up of the insurance market for private entry and the accompanying hype it is being hoped that in the days to come, the teeming population of India can look for health coverage from an array of insurance providers that too at an affordable price. The common negative factors which evolve after looking at various health coverage phase are 1. Quality of service when facilities are owned by the plan giver. ESIS, CGHS is grossly inferior Reimbursement delays – in case out of pocket spending and or rejections of claims 2. Limitations of services –Either monetary restriction on the amount available per year or non-comprehensive care of certain pre-existing & chronic ailments. 3. Inadequate information regarding health, ailment, procedures & treatments, cost and outcome 4. Provider malpractices 5. Coatings for comprehensive total care 6. The Low Level of Medical Penetration in India The total percentage of population covered under any sort of medical coverage is in single digits which is woefully inadequate. Further, T.Y.B.B.I

13

TYBBI

HEALTH INSURANCE

most of these covered persons belong to the organized sector mainly in sectors like Railways, Defense, Central Government, etc. Within this, only a negligible percentage of the persons are covered under private health insurance. If we are seriously looking at a problem is by resorting to alternative avenues like private health insurance. It is usually mentioned that it is difficult to bring the rural, illiterate folk under the umbrella of insurance. When it comes to health insurance, this argument would not hold any credence as many of the so-called educated people themselves do not understand the importance of having such protection. Thus, there is a monumental task of convincing different classes of the society about insurance in general and health insurance in particular. Let us take a look at how health, as a class, has been performing in the Indian insurance market. A commercial health insurance policy has been introduced in the market in the late 1980s; and thus it remains one of the youngest classes to be introduced in the industry. In spite of that, it is third largest class in terms of gross premium(Rs.78,831 lakh) earned for the quarter-ended June 2006, after Motor (2,39,117) and Fire (Rs. 1,63,286). Further, even if one considers the growth percentage of any class, health has grown by about 44% for the oneyear period (June 05 to June 06). In absolute terms, it has registered a growth of Rs.25, 303 lakh from Rs. 53,528 lakh. This compares very favorably with the overall performance of the industry which registered a growth of Rs.1, 24,906 lakh, from Rs.5, 38,084.32 to Rs.6,62,900.78; which is around 23%. In the process, it has overtaken T.Y.B.B.I

14

TYBBI

HEALTH INSURANCE

more conventional classes of insurance like marine and engineering. Looking at in isolation, it has a commendable performance. But when one looks at the percentage of the population who actually go for commercial health insurance, particularly in the rural areas; one could easily realize that something grossly wrong with the way private health insurance is being accessed in the country. On the contrary, it is commonplace to observe some member or the other in many families to be hospitalized in a nearby town and in most of these cases; they end up paying huge amounts of hospital hills. Going further, the funding for such casualties is provided by the ubiquitous moneylender; and thus they become unfortunate victims of a debt trap. Looking at the importance of providing healthcare for the masses, any amount of hard work should not be deterrent. In accomplishing this huge task, there is a role for everyone to contribute in whatever manner they can.

T.Y.B.B.I

15

TYBBI

HEALTH INSURANCE

LICENSING HEALTH INSURANCE IN INDIA Health insurance is one of the most regulated forms of insurance business in those countries where it plays a dominant role in financing of health expenditures. Spiraling healthcare costs and rapid technological advances in the medical field have triggered the need for cost-containment by the health insurers without sacrificing the interest of the policyholders or claimants. The nature of loss in health insurance might result in differences of opinion. All these call for intervention by regulatory authorities to protect the consumers However, under the Insurance Regulatory Development Authority (IRDA) in India, the powers of licensing and regulatory insurance, including health insurance, has been mandated under an act parliament. Despite such a regulatory authority, very little has been done by IRDA to lay down ground rules for hospitals which run health plans and may be required to register themselves as insurers or hospital managed organizations (HMO). It may be pertinent to note that in similar situation, the US federal and state health insurance regulation prescribe elaborate legal framework to ensure quality standards for rate regulation, cost containment, etc.

T.Y.B.B.I

16

TYBBI

HEALTH INSURANCE

HEALTH SECTOR FINANCING One of the major goals for the future health system in India is to ensure good health for the population through access to high quality services. To achieve this goal, there is a need to enlarge coverage and rationalize the current mechanisms for collective health financing. There are at least six dimensions of the choice of health financing policies:  Identification of beneficiaries  Benefits covered by insurance source(s) of financing 

Methods for provider payment institutions that pay providers.

 Role of public and private sectors in the delivery of service Tax funded Public

Total health Expenditure

Private

Social Security Externally funded Out-ofPocket Private Health Ins Externally sourced

T.Y.B.B.I

17

TYBBI

HEALTH INSURANCE

HEALTH INSURANCE AS A HEALTH FINANCING TOOL Attracting additional money for health additional resources may be available through insurance because firstly, consumers are more enthusiastic about paying for health insurance than paying general taxations, the benefits are specific and viable and secondly, consumers are more able and prefer, to pay regular, affordable premiums rather than paying fees for treatment when they are ill. Getting better value for money (or increasing efficiency)  Improving the quality and targeting of healthcare (increasing effectiveness) 1. A greater explicitness and viability of spending on health services occurs as a result of insurance. 2. The third party institution can specify in contracts the kinds of healthcare that to be provided and can therefore concentrate on providing cost effectiveness 3. Consumers, and their representatives, will demand better quality care because they can see a definite link between their payments and services

T.Y.B.B.I

18

TYBBI

HEALTH INSURANCE

HEALTH CARE PRODUCTS The following are brief descriptions of some of the major health care products available in world markets today.  Capital Disability Policies Disability benefits cover the financial risk to the insured of his/her becoming disabled and are expressed either as occupational disability or the inability to pursue any activity for a living. Benefits are payable in the form of a lump sum or as an income.  Permanent Health Insurance Policies Disability income benefits pay a regular income should the insured experience a loss of income upon becoming fully or partially unable to follow their own or similar occupation. The benefit usually pays an income either until the insured has recovered sufficiently from the temporary disability to return to work, or has died or until normal retirement age. A waiting period is usually imposed prior to the commencement of the benefit payment.  Dread Disease (or Critical Illness Policies) A Dread disease benefit offers a payment (sometimes an accelerated death payment) on a confirmed diagnosis of a dread disease. This benefit is usually valid in the case of a limited number of listed diseases, which often include the following T.Y.B.B.I

19

TYBBI

HEALTH INSURANCE

diseases: Heart attack, Stroke, Coronary artery disease requiring surgery, Cancer, Kidney failure, Surgery for a disease of the aorta, Replacement of a heart value, Organ transplant, Coma Other diseases can also be included and the percentage of the sum assured paid for each disease may be related to the severity of the disease.  Long Term Care Policies This policy provides financial security against the risk of needing either home or nursing-home care as an elderly person. Premiums will be paid regularly and will cease either when benefit payments commence or earlier (e.g. at a given age). A group version of this product would enable an employer to provide long term care to retiring employees and their spouses.  Hospital Cash Policies Hospital Cash policies usually provide the insured with a daily cash amount for the duration of an insured’s stay in the hospital. Further benefits are often added in order to cover the additional costs associated with any visit to the hospital. These would often be in the form of a major medical expense policy

T.Y.B.B.I

20

TYBBI

HEALTH INSURANCE

 Major Medical Expense Policies Major Medical Expense’s policies often complement a hospital cash policy. The policy would cover the costs associated with specified medical procedures. These would include the cost of any surgery or follow-up visits to a Doctor. The actual benefit would normally be based on a pre-determined fee scale for various different procedures.

T.Y.B.B.I

21

TYBBI

HEALTH INSURANCE

GOVERNMENT/STATE BASED SYSTEMS The best documented and largest system of health care delivery in India is the diverse network of hospitals, primary health Centres, community health centres, dispensaries and speciality facilities financed and managed by the Central and State local Governments. These facilities are officially available to the entire population either free or for nominal charges. Along with some other networks of village health workers, maternal and child health programmes and speciality disease prevention programmes these public facilities carry out a central role in India’s primary health care system short of durgs and essential supplies and that they sometimes suffer from low morale and inadequate motivation. The health facilities made available to the public are managed and operated under the authority of central and state agencies. The state governments mostly own and mange the public sector delivery system and have to bear the costs of operation. But the Central Government plays a major role on the planning, financing and transfer for resources that determine new investment in health facilities and specialized programmes. Much of the funding for health facilities originates from the Union Ministry of Health and Family Welfare and is channeled to the state governments, which retain considerable authority for the spending decisions. Over the years, the Central Government have been the main source of funds for the primary health care facilities, whereas the states bear the major responsibility T.Y.B.B.I

22

TYBBI

HEALTH INSURANCE

of recurrent costs, especially the costs of running hospitals. This system has added to the overall inefficiency of public health facilities. 

CENTRAL GOVERNMENT HEALTH SCHEME:

The Central Government Health Scheme (CGHS) was introduced in 1954 as a contributory health scheme to provide comprehensive medical care to the central government employees and their families. It was basically designed to replace the cumbersome and expensive system of reimbursements (Ministry of Health and Family Welfare, Annual Report 1993-94). Separate dispensaries are maintained for the exclusive use of the central government employees covered by the scheme. Over the years, the coverage has grown substantially with provision for the non-allopathic system of medicines as well as for allopathic. In addition, the CGHS reimburses patients for part of their out of pocket costs on treatment at the government hospitals and some other facilities. The list of beneficiaries includes all categories of current as well as former government employees, members of parliament and so on. The CGHS has been in the recent past, widely criticized from the point of view of quality and accessibility.

T.Y.B.B.I

23

TYBBI

HEALTH INSURANCE

 EMPLOYEES STATE INSURANCE SCHEME: Established in 1948, the Employees State Insurance Scheme (ESIS) is an insurance system which provides both the cash and the medical benefits. It is managed by the Employees State Insurance Corporation (ESIC), a wholly government-owned enterprise. It was conceived as a compulsory social security benefit for workers in the formal sector. It benefits 33.4 million workers with income less than Rs.6500/- a month along with their families. Since 1989 the schemes has been expanded, and it now includes all such factories which are ‘not using power’ and employing 20 or more persons. Mines and plantations are explicitly excluded form coverage under the ESIS Act.

T.Y.B.B.I

24

TYBBI

HEALTH INSURANCE

EMPLOYER-MANAGED SYSTEMS “Employer-managed health facilities” and the “reimbursement of health expenses by employers” are the other means of health insurance in India. Generally, the public sector undertakings and big industrial houses have their own dispensary and hospitals and provide medicines, etc, across the counter, usually within the company premises township. These include defence services, educational institutions, particularly universities also provides medical services to their employees.In addition, there are various medical reimbursement plains offered by employees for private medical expenses in the private sector including commercial banks and autonomous institutions. Also, in some organization we may find a self-insurance system known as medical benefit or medical allowance scheme. Under this scheme, employees incurring medical expenses are required to submit their claims to their employees for reimbursement, and reimbursements are not linked to their individual contribution. Such coverage’s generally vary according to the employee’s salary or designation. Overall, the performance of these systems in India has been satisfactory.

T.Y.B.B.I

25

TYBBI

HEALTH INSURANCE

NGO SYSTEMS Health facilities are also provided by voluntary and charitable or Nongovernment organizations (NGOs). Some of the important NGOs are Child In Need Institute (CINI), Self-employed Women’s Association (SEWA), Streehitkarni and Parivar Seva Sanstha. The health care facilities offered by these organizations are a part of their main objectives. Though, these are not exactly health insurance programmes, yet they have potential to generate awareness and associate themselves with the major health insurance.

T.Y.B.B.I

26

TYBBI

HEALTH INSURANCE

MARKET BASED SYSTEMS A. GIC Mediclaim Coverage’s: 1) Mediclaim or Hospitalization Benefit Insurance Policy 2) Bhavishya Arogya Insurance Policy 3) Jan Arogya Bima Policy B. LIC Coverage’s: 1) Jeevan Asha 2) Asha Deep A. GIC (GENERAL

INSURANCE

CORPORATION)

Mediclaim Coverage’s: The GIC holds a major share in the market-based health insurance segment. It introduced the standard “Mediclaim” health insurance scheme in 1986, and become operational in 1987. This product was later on modified in 1997 to allow for premium differentials for various age group meant for both individuals and groups. As on date, the GIC and its subsidiaries offer the following products: 1) Mediclaim or Hospitalization Benefit Insurance Policy:  Suitability: Anyone in the age group of 5 to 80 years can take the policy. Children in the age group below the age of 5 years can also be covered from the age of 3 months onwards provided one or both of the parents are covered concurrently. Higher limits are permitted of T.Y.B.B.I

27

TYBBI

HEALTH INSURANCE

the policy is in renewal for the preceding three years. Suitable for persons of any nationality but treatment should be availed of within the country and the claim is paid in Indian currency/foreign currency.  Salient Features:  Provides cover, which takes care of medical expenses following hospitalization from sudden illness or accident  Cover extends to pre-hospitalization and post-hospitalization for periods of 30 days and 60 days respectively.  Domiciliary hospitalization is also covered.  Benefits:  Reimbursement of medical expenses  Discount in insurance premium is allowed on family package, cumulative bonus and health check. In case of family package cover, a single member can avail of the entire policy limits.  The premium paid by a cheque upto a maximum of Rs. 10,000 is totally exempt from income tax.

T.Y.B.B.I

28

TYBBI

HEALTH INSURANCE

 Domiciliary Hospitalization: The term means that a patient can be treated at home when he is not in a fit condition to be moved to the hospital or where is no accommodation in the specialist hospital provided.  The treatment was for a period not less than 3 days.  The sub-limits of sum insured towards domiciliary hospitalization are furnished

in the sum insured and premium schedules.

 Exclusions:  The facility is not available if any illness is contracted within 30 days from the commencement of risk except in case of an accident.  Any pre-existing diseases  Treatment for contracts, benign prostatic hypertrophy, hydrocele, congenital internal diseases, fistula in anus, piles sinusitis and related disorders for 1st year of policy  AIDS or conditions of similar kind.  Requirements: A completed proposal form. If the prosper is a ‘Diabetic’, a separate questionnaire completed by the family physician.

T.Y.B.B.I

29

TYBBI

HEALTH INSURANCE

2) BHAVISHYA AROGYA INSURANCE POLICY:  Suitability: Bhavishya Arogya is a life term policy where medical benefits are made available after retirement of the insured. Therefore, by paying premiums during the earning period, one can make a provision for medical benefits after retirement. Persons in the age group- of 25 to 55 years are eligible for this policy.  Salient Features:  The policy provides hospitalization benefits for lifetime after retirement’s age of the insured.  Premiums can be paid in equated annual installments up to the age of retirement  Premiums can also be remitted in lumpsum on one time basis. Discount is offered for one time payment  Benefits: The policy comes into force after retirement and provides for hospitalization and domiciliary hospitalization benefits, following an accident or sickness.  Other conditions:

T.Y.B.B.I

30

TYBBI

HEALTH INSURANCE

 The minimum sum to be insured is Rs. 50,000 and can be increased in multiples of Rs.10, 000 as a unit, thereafter.  For every Rs. 10,000 increase of sum insured, the premium is loaded by 20%  Maximum sum insured is Rs. 2 lakh.  After commencement of the risk (i.e. after retirement) cumulative bonus @ 5% for every successive claim free year is added upto a maximum of 50%.  In case of death of insured before retirement, refund of premium will be at a pre-determined scale and it is payable to nominee/assignee.  In the event of voluntary cancellation of the policy, the refunds will be75% of the set scales applicable for death claims, provided there is no claim under the policy.  Requirements  A completed proposal form  Proof of age is necessary as the payment of premium depends on the age

T.Y.B.B.I

31

TYBBI

HEALTH INSURANCE

3) JAN AROGYA BIMA POLICY:  This policy was introduced in the year-1998. It is designed to provide hospitalization insurance to poorer sections of the society.  The coverage is along the lines of the individual mediclaim policy except that cumulative bonus and medical check up benefits are not included.  The sum insured per insured person is restricted to Rs. 5000/-. Premium up to Rs. 10000/- qualifies for tax benefit under Section 80D of the Income Tax Act. Service tax is not applicable to the policy. The premium payable as per the following table Age of the person

Up to 45 46-55

56-65

66-70

years Head of the family 70 Spouse 70 Dependent child up to 25 years 190 For family of 2+1 dependent 190

100 100 250 250

120 120 290 290

140 140 330 330

children For family of 2+2 dependent 240

300

340

380

children  The policy is available to individuals and family members by duly completing the proposal form. The age limit is 5 to 70 years.  Children between the age of 3 months and 5 years can be covered provided one or both parents are covered concurrently. T.Y.B.B.I

32

TYBBI

HEALTH INSURANCE

B. LIC COVERAGE’S: The Life Insurance Cooperation of India introduced a special insurance programme in 1983 which covered medical expenses for only four dreaded diseases. It was withdrawn and introduced subsequently in 1995. At present the modified versions are available in the form of two products viz. Jeevan Asha and Asha Deep 1) Jeevan Asha:  Features:  Open ended scheme  Covers many surgical procedure  Fixed benefits for surgical treatment can be availed twice (subject to conditions)  Exclusive Double/Triple accident benefit.  Option to switch over from existing Jeevan Asha plan  Suitable for: The Jeevan Asha II plan is apt for people who whose family history tends to show hereditary lineage of maladies and afflictions that have required major or minor surgery from time to time.

T.Y.B.B.I

33

TYBBI

HEALTH INSURANCE

Special Features: Under the Jeevan Asha plan, the major surgical procedures covered for are:  Nervous system (non-malignant causes)  Respiratory system  Cardiovascular system  Haemic and lymphatic system 

Endocrine & Ocular system

2) Asha Deep: 

Features: Cover the risk of four major ailments namely, Cancer (malignant), Paralytic stroke resulting in permanent disability, renal failure of either kidneys or Coronary artery diseases where by-pass surgery has been done.

 Suitable for: The Asha Deep II (with profits) policy is best suited for people if they anticipant or have a family history of serious diseases like Cancer, Paralysis, Renal failure and Coronary disease.



Special Features:

T.Y.B.B.I

34

TYBBI

HEALTH INSURANCE

During the term of the policy, if the life assured is afflicted by any of the major ailments listed above and the same is established as per rules (in case of Coronary artery disease, the life assured must have undergone the by-pass surgery), the policyholder will be eligible for the following benefits, the policy is in force for the full sum assured. Immediate payment of 50% of the sum assured Payment of an amount equal to 10% of the sum assured, every year commencing from the policy anniversary falling on or after the date of affliction and ending with the policy anniversary preceding the date of maturity or the date of death of the life assured whichever is earlier. Payment of balance 50% of the sum assured and vested bonuses on the date of maturity or on death of life assured, whichever is earlier. The bonuses will be calculated on the full sum assured even though 50% of the sum assured would have been paid earlier A lien for a period of one year will be imposed on all policies on all policies under this plan. If the life assured does not get afflicted by any of the diseases mentioned above, the full sum assured and vested bonuses will be paid on the date of maturity or on death of the life assured, whichever is earlier.  Benefits 1. Survival Benefits 2. Sum Assured and vested Bonus on maturity.

T.Y.B.B.I

35

TYBBI

HEALTH INSURANCE



Death Benefits:

 Natural: If the life assured is not afflicted by any of the specified ailments, the legal heirs get the full Sum assured + accrued bonus.  Accidental: Accidental benefits available to the life assured whether afflicted or not afflicted by any of the specified ailments.

T.Y.B.B.I

36

TYBBI

HEALTH INSURANCE

MEDICLAIM - AT A GLANCE: The Policy basically covers reimbursement of expenses of hospitalization and domiciliary hospitalization for illness, diseases or injuries sustained. This Policy is available to persons between the age of 5 and 80 years (children between the age group of 3 months to 5 years can be covered if one or both their parents are also covered concurrently).  Basic Cover  Pre hospitalization Benefits  Post hospitalization Benefits  Sponsored Health Check Ups  Discount in Premium for family cover

T.Y.B.B.I

37

TYBBI

HEALTH INSURANCE

 Basic Cover: The insured person can claim reimbursement for the following expenditures, provided they are reasonable and necessary incurred:  Room expenses  Nursing expenses  Surgeon, anesthetist, consultants, specialists fees  Artificial limbs, cost of organs, O.T charges, medicines and drugs and similar expenses  Note: Under no circumstance will the reimbursement exceed the sum insured. In case of a Family Mediclaim Policy, the claim cannot exceed the sum insured specified against each person in the proposal form  Any relevant medical expense incurred within 30 days prior to hospitalization will also be covered under this policy  Post Hospitalization Benefits

T.Y.B.B.I

38

TYBBI

HEALTH INSURANCE

Any relevant medical expense incurred within 60 days after hospitalization will be considered for reimbursement under this policy.  Sponsored Health Check Ups A person insured under this scheme is eligible for reimbursement of the cost of a complete medical check up (subject to 1% of average sum insured). This benefit can be availed once at the end of a block of every four underwritten - claim free years. To be eligible for this benefit you must ensure that the policy is renewed within a week from its expiry.  Discount in Premium- for family cover If you take a Mediclaim Policy to cover yourself and one or more of the following persons in your family, you get a 10 % discount in the total premium payable. 

Spouse



Dependent children



Dependent parents

T.Y.B.B.I

39

TYBBI

HEALTH INSURANCE

OVERSEAS MEDICLAIM At a glance you need Videsh Yatra Mitra Policy if you are going abroad on business or holiday. The benefits under policy include: 1. General Insurance Plans a) Personal Accident Cover b) Medical Expenses and Repatriation c) Cover Loss of Checked in Baggage d) Cover Delay of Checked in Baggage e) Cover Loss of Passport f) Personal Liability Cover 2. Special Insurance Plans a) Corporate Frequent Traveler’s b) Overseas Journey – Business and holiday

T.Y.B.B.I

40

TYBBI

HEALTH INSURANCE

1. General Insurance Plans: a) Personal Accident Cover If the insured person suffers any bodily injury during the overseas trip and such injury, within 12 months of its occurrence, is the sole cause of death, loss of sight or limbs of the insured, the Insurance Company will pay up to US$ 50,000 as compensation. Note: No claim will be satisfied in excess of US$ 2000, on death of the insured person, if he/she was less than 16 years of age at the time of affecting the insurance. b) Medical Expenses & Repatriation The cover provided by the Insurance Company extends to US$ 500,000 (for worldwide travel including USA & Canada) and US$ 250,000 (for worldwide travel excluding USA & Canada). It is paid to the insured in respect of any permissible and necessary medical

T.Y.B.B.I

41

TYBBI

HEALTH INSURANCE

expenses that are borne by him outside India on account of any injury or sickness suffered during the period of insurance. If "Mercury" recommends that continued treatment in India is appropriate, then (notwithstanding anything specified above), the insurance is extended to cover medical expenses incurred in India also. These expenses will be paid only towards treatment undergone within 90 days from the date on which the injury or illness first manifested itself.  Medical Expenses Covered: 

Physician's services, hospital and medical services and local ambulance services.



Up to US$ 225 per dental service taken only for immediate relief of toothache. Dental care rendered necessary as a result of an accident that is covered, shall be reimbursed subject to the limit of cover under Personal Accident.



Expenses incurred for emergency medical evacuation including transportation and medical care en route.



If the insured person dies abroad, the expenses incurred for the preparation and air transportation of the remains to India or an equivalent amount for their local burial or cremation.  Specific Conditions:

T.Y.B.B.I

42

TYBBI 

HEALTH INSURANCE

Claims will be reimbursed only to the extent they are reasonable and customarily incurred whether in case of medical or dental attention or transportation.



"Mercury" and their Medical Advisors must approve medical evacuation and transportation in advance.



Medical expenses that could have been postponed till the insured returned to India will not be reimbursed. The attending physician and the Medical Advisors shall decide which expenses can be and which can't be delayed.



US$ 100 is the deductible amount and any expense below this amount will have to be borne by the insured person. Further, it also means that from every claim this amount will be deducted before making settlement.



Claims in respect of cosmetic surgery will not be paid unless it is rendered necessary as a result of a covered accident.



Routine physical examinations and any other examinations that are not undertaken as result of impairment of normal health shall not be covered.



Pregnancy and related complications are not covered under this policy.



Where the insured person is unable to present himself or herself for the medical examination (where one is called for by the Insurance Company), the limit of indemnity will be reduced to US$ 10,000. This limit will be utilized only towards physician's services, hospital and medical services and local emergency

T.Y.B.B.I

43

TYBBI

HEALTH INSURANCE

transportation. Further, the insurance cover will be restricted to cover only illness or diseases contracted abroad and not cover accidents.

c) Covers Loss of Checked in Baggage The insured will receive US$ 1,000 from the Insurance Company in the event of total loss of baggage that has been checked in by an International Airline for an international flight. The insurers however reserve the right to either replace or pay the intrinsic value of the lost article.  Specific Conditions:  The Insurance Company will not reimburse partial loss or damage of baggage  No claim will be paid for items whose value exceeds US$ 100, unless the proof of ownership is presented to “Mercury”, in the event of submission of claim.  Valuable items are not covered by the policy since they should at all times be carried by the insured person and not be packet as part of checked in baggage.  Any recovery from the airline under the terms of the Warsaw Convention shall become the property of the insurers.

T.Y.B.B.I

44

TYBBI

HEALTH INSURANCE

d) Covers Delay of Checked in Baggage The Insurance Company will pay up to US$ 100 towards necessary purchases, to replace items, in the event of more than 24 hours delay (from the scheduled arrival time) in delivery of checked in baggage. The baggage should have be checked into an International Airline on an international flight from India.  Specific Conditions:  The proof of purchase must be provided for all items reimbursed under this cover  Any payment made by the Insurance Company for delay of baggage will be offset against a claim arising for loss of the same baggage. e) Covers Loss of Passport In the event of loss of passport, the Insurance Company will pay up to US$ 250 towards expenses reasonably and necessarily incurred by the insured person in obtaining a fresh or duplicate passport.

T.Y.B.B.I

45

TYBBI

HEALTH INSURANCE

US$ 30 is the deductible amount and any expense below this amount will have to be borne by the insured person. Further, it also means that from every claim this amount will be deducted before making settlement.

 Specific Conditions: 

Loss or damage to the passport due to confiscation or detention by customs, police or other authority will not be covered under this policy.



Claims for loss of passport will not be entertained if the theft of passport was not reported to any police authority within 24 hours of discovery. An official report is also to be obtained from them.



No claim shall be paid for loss or theft of the passport if it was left unattended by the insured person. However, if the passport was left in a locked room or apartment and the insured person could not have stored it in a safety deposit box, the claim will be satisfied.

f) Personal Liability Cover The Insurance Company will pay up to US$ 200,000 in case the insured person, in his or her personal capacity, become legally liable to pay third parties for accidental personal or property damage, arising from an incident during the overseas journey. T.Y.B.B.I

46

TYBBI

HEALTH INSURANCE

 Specific Conditions: US$ 200 is the deductible amount and any expense below this



amount will have to be borne by the insured person himself or herself. Further, it also means that from every claim this amount will be deducted before making settlement. This deductible applies only to third party property damage. The Insurance Company shall meet no claims arising from



Employers or Contractual liability. No claims arising from liability to any family members,



traveling companion, friend or colleague of the insured, shall be met. Claims arising directly or indirectly from the following shall not



be paid. 

Animals belonging to the insured person or in their care, custody or control.



Any willful, malicious, or unlawful act.



Pursuit of a trade, business or profession, employment or occupation.



Ownership, possession, or use of vehicles, aircraft, watercraft, parachuting, hand gliding, air ballooning or use of firearms.



Legal costs of any proceedings that result from any criminal or illegal act.



Insanity, use of alcohol, drugs (except as medically described) or drug addiction.

T.Y.B.B.I

47

TYBBI

HEALTH INSURANCE



Supply of goods or services.



Any form of ownership or occupation of land or buildings (other than occupation only of any temporary residence)

2. Special Insurance Plan: a)Insurance Plan for Corporate Frequent Traveler: This is a one-year cover issued to employees of companies who have to travel abroad frequently.

 Features: 

Each trip should not exceed 30 days. This period can be extended by 7 days without any extra charge, if the delay is beyond the control of the insured person.

 The insured person can be between 18 and 70 years of age. The age limit can be extended to 75 years at the option of the Insurance Company and after such person undergoes a thorough medical check up. The Medical Reports should be authorized by an M.D. in Cardiology and should include, ECG Reading, fasting blood sugar/Urine sugar & Treadmill test in case of medical history.

T.Y.B.B.I

48

TYBBI

HEALTH INSURANCE

 The Monetary Compensations offered in each case: LIMIT (in

BENEFIT

US$)

REMARKS Deductible:

US$

Medical Expenses

500,000

Personal Accident

25,000

-

1,000

-

100

Delay > 12 hrs

Loss of Passport

250

Deductible: US$ 30

Personal Liability

200,000

Loss

of

Checked

in

Checked

in

Baggage Delay

of

Baggage

T.Y.B.B.I

100

Deductible:

US$

200

49

TYBBI

HEALTH INSURANCE

MICRO HEALTH INSURANCE IN INDIA Health risks and resulting catastrophic financial losses are probably significant threats to the people, particularly persons belonging to lower income groups as these people will be excluded from private health insurance. A health shock leads to direct expenditures for medicine, transport and treatment but also to indirect costs related to loss of wages. Since studies have found a very strong link between health and income poor are the most susceptible to a health shock. Given the problem with public health delivery system, the access to and utilization of these facilities remain problem. Strategy to improve the access by developing insurance system to private providers has been one such area. For low-income people in rural and informal sector market based insurance such as Mediclaim can not meet the requirements because of its high cost. Insurance companies and healthcare providers face high transaction costs and also they do not have local information available with them. This makes their job of providing health insurance to this segment very difficult and schemes

T.Y.B.B.I

50

TYBBI

HEALTH INSURANCE

which are of local origin have more chance of attracting more members because of high level of trust with them. Several community based organizations in India have focused on developing community based insurance schemes during the last decade. Most of these community based insurance schemes (CBHI) are also known as micro health insurance schemes. Micro insurance is a form of health, life or property insurance, which offers limited protection at a low contribution (hence “micro”). It is aimed at poor sections of the population and designed to help them cover themselves collectively against risks (hence “insurance”). More specifically micro insurance and CBHI are different in term interchangeably. In India, community health insurance started way back in Kolkata in 1952 which was part of a student’s movement. This scheme, which is called the Student’s Health Home (SHH), caters to the schools and universities students of West Bengal. Currently there are more than 20 documented CBHI programmes, of which five were initiated in the past three years community based health insurance schemes is different from normal market based schemes like Mediclaim. Though the basic principle of covering future risks by paying premium in advance is same in all health insurance schemes, CBHI schemes are tailored for local needs and provide health insurance at low cost. CBHI schemes in India can be divided in three broad categories. Table 1 indicates that these three categories are quite distinct from each other in terms of the function of the agency. An agency here can T.Y.B.B.I

51

TYBBI

HEALTH INSURANCE

be a NGO, Trust, Hospital or Cooperative etc. their role can vary from performing as intermediary where both treatment and insurance are provided by intermediary itself or where the treatment and insurance are provided by third party. Micro health insurance as mechanism of providing healthcare to the poor, the role of these CBHI schemes will be very crucial. The success of many of these schemes though at a smaller level at present, provides important lessons for the policy makers. One important point to remember here is that CBHI schemes have their own problems which are non-availability of good providers, lack of professional management, financial sustainability issues and non-recognition by IRDA. These problems need to be taken into account while assessing their benefits. Though at present CBHI schemes in India are serving a very small population, it lessons learnt from each of these schemes can be used to design more of such schemes in different parts and at much larger level they can be beneficial.

T.Y.B.B.I

52

TYBBI

HEALTH INSURANCE

THIRD PARTY ADMINISTRATORS It’s an institution which facilitates a system of cash-less settlement of medical bills for the insured under health insurance has been introduced in India as recently as 2001. The first set of companies was given licenses in March, 2002. Today, there are 25 licensed Third Party Administrators (TPAs). Covered medical expenses are paid by the TPAs directly to the hospital. Administrator It acts a link between the insurer and the hospital. TPAs basically are professional organizations servicing health insurance policies sold by insurance companies by way of facilitating cash less treatment to insured individuals through institutional arrangements with insurance companies and networked service providers i.e. hospitals and nursing homes, etc. The TPAs are registered with and licensed by the IRDA and regulated by IRDA regulations, 2001 as amended from time to time. They will provide quality health care and services at affordable costs, which hitherto was unheard of. The role of TPAs will

T.Y.B.B.I

53

TYBBI

HEALTH INSURANCE

particularly be beneficial to those sections of society for whom quality healthcare has always remained a dream. By processing claims with due diligence, TPAs are expected to control claims costs for the insurers. In the long run, TPAs are expected to bring in greater professionalism in the health insurance industry, which would augure well for the growth of this segment of insurance business. TPAs are licensed by the Insurance Regulatory and Development Authority. The criteria for licensing are  Only a company with a share capital and registered under the Companies Act, 1956 can function as a TPA.  Company shall not engage itself in any other business.  The minimum paid up capital shall be Rupees One Crore in equity shares.

T.Y.B.B.I

54

TYBBI

HEALTH INSURANCE

FURTHER ISSUES RELATING TO HEALTH INSURANCE POLICIES: 

The Legislative Environment A fine balance between government imposed regulation and self regulation by the industry needs to be found. It a particular industry is “over” regulated it stifles innovation and development. On the other hand “under” regulation can result in unwanted practices and “fly by night” operations.



Socio-Economic Environment The socio-economic environment has a significant impact on the type of health insurance policy that consumes will look to buy. If will also have an impact on the claims patterns of consumers. For instance, in a relatively poor society, product demand will be for products that cover day-to-day basic medical care. This will tend to be products which have high frequency of claims where the average claim sizes are relatively low.

T.Y.B.B.I

55

TYBBI



HEALTH INSURANCE

Post Retirement Benefits Another challenge for the insurance industry is how to deal with post retirement medical benefits. One possible way of dealing with these is to use some form of endowment product ( where premiums are paid during the working life of the insured) to provide a lump sum at retirement date which can be used to pr-fund medical expenses (or a future Medical Expense Policy).



IT Systems The measurement and manipulation of data is of essential importance in operating an effective health care management system. There is a vast quantity of data that must be stored and manipulated for the various aspects of health care management. In addition this data should be readily available and easily updateable. In short the system should be robust!



Investment Strategy Due to the frequency and level of the contribution received for most health insurance products, providers have large amounts of funds that need to be invested in appropriate vehicles. Certain countries (e.g. South Africa) have also introduced reserving requirements, which will result in significant reserves building-up over time for health Insurance products. This has introduced the

T.Y.B.B.I

56

TYBBI

HEALTH INSURANCE

additional complication of matching assets and liabilities. This is an area where actuarial judgement is essential. 

Cross Subsidies The issue of cross-subsidies is another item which needs to be carefully considered by any insurer. There often tends to be crosssubsidies in health insurance policies and in particular in medical expenses policy. Even when legislation does not force crosssubsidies, it is quite common for there to be cross-subsidies in health Insurance products. The insurance company needs to examine the level of the cross-subsidies and ensure that the style of their products is such that anti-selection will not result in abuse of these cross-subsidies.



Risk Management The success of any health insurance policy is crucially dependent on appropriate management of the underlying risks which can be best attained by

T.Y.B.B.I

57

TYBBI

HEALTH INSURANCE

 Setting of appropriate premiums  Measurement and control of expenses  Appropriate use of reinsurance avoidance of anti-selection  Investment strategy and subsequent measurement  Effective underwriting effective claim control  Appropriate reserving  Internal operational control AIDS



The challenges that faces health insurers is how to deal with AIDS claims, and what product can be designed that meet the needs of AIDS suffers. This is a challenge that has not, in any market, to my knowledge, been fully addressed. In some Southern African countries, insurance companies are offering certain anti-retroviral treatments in order to extend the expected life span of their policy holders. This is one area where health Care Management can be used to delay the payment of insured benefits (normally Life Insurance) and also add the expected life of the insured, thus benefiting all parties concerned.  Medical Savings Account: One example of a new product introduced to relieve the risk of rising costs is the introduction of medical Savings Account (MSA) as a component of a Medical Expense Policy. The account holder, T.Y.B.B.I

58

TYBBI

HEALTH INSURANCE

at each ill health incident, has to take a conscious decision whether or not to draw on savings and deplete his wealth. MSA’s can be encouraged fiscally by providing savers with tax breaks not available to savers for other purposes. The funds in an MSA could be used to pay health premiums, deductibles or other medical bills not covered by insurance. An MSA minimizes moral hazard. There are two main kinds. One is a short term scheme which can be used at the discretion of the account holder for day-to-day expenses; the other is long term, where the savings are intended to build up to a substantial sum for either major expenditures or for old age.

 Capitated Arrangements: A further innovation in some progressive markets, including the South African market is the use of a capitation arrangement for Medical expense Policies. A capitation arrangement involves identifying certain service providers usually doctors who will provide given services to their patients. The services provided are usually doctor’s consultations. The doctor is paid a fixed fee per policyholder under its care. The doctor is then responsible for providing whatever care is necessary to that patient. By linking up a provider network through a capitation arrangement the risk of T.Y.B.B.I

59

TYBBI

HEALTH INSURANCE

over servicing and hence higher costs is placed in the hands of the doctors. It will then be up to the doctor to ensure that members receive appropriate services which will costs the doctor and not the insurer more.

CONCLUSION: The Government of India, in one of its economic survey reports, has proclaimed that human development is the ultimate goal of India's developmental plans. It is also being realized that sound long-term development of social sectors, such as education, and health is crucial to sustain economic growth in an increasingly integrated world economy. The government can intervene in the health insurance market in two ways: by directly providing subsidizing insurance or by regulation. These two forms of intervention do not lead to identical T.Y.B.B.I

60

TYBBI

HEALTH INSURANCE

results. Provision of partial public insurance, even supplemented by the possibility of opting out, can lead to second beat equilibrium. Regulation of the private insurance market by imposition of a standard contract or by restricting premium rates, on the other hand, can exacerbate the problem of adverse selection and lead to chronic market instability. There is yet another criticism about the Indian health delivery system: urban bias in the allocation of resources. As of 90-91, 66.96 percent of the resources spent on health care had gone to the urban sector which accounts for 25.7 percent of the total population, while only 33.04 percent of the resources had gone to the rural sector, which accounts for 74.30 percent of the total population. The per capita expenditure on health care of the urban sector was said to be around Rs.152 as against Rs.26 of the rural sector. The Government being the central player in the health care delivery, the system is suffering from financial constraints and inefficiency in allocating whatever resources available. It is slowly being realized that sole reliance on the public health care system is no longer desirable.

T.Y.B.B.I

61