Health

Insurance
 System of assurance to make
contingencies of health care expenses.

To provide protection against financial

Health loss by unforseen sickness.

Insurance To meet cost of good medical care.

Relieves anxiety & tension.

Definition

“Health insurance, like other forms of insurance, is a form

of collectivism by means of which people collectively pool
their risk, in this case the risk of incurring medical
expenses.”
 • 1883 Bismarck- sickness benefit to workers.

• 1911 Lloyd George- National Health Insurance

History of HI Scheme to cover sickness expense, medical relief,
drugs & compensation of wages lost, to improve
quality of life and improve industrial production.

• J.F.Kimball: prepayment system of health care.

Workman’s compensation Act. First ESI hospital established. IRDA act passed.

1923 1952 1999

1948 1959–1961 2001

ESI Act passed. Mudaliar Committee(1959-1961) Insurance amendment Act

recommendations: – Long range
health insurance policy for all. –
Small fee for availing health
services. •
 • Indemnity Insurance:
where the insurer first pay to the hospital and claim is
made.
E.g. Jeevan Asha II, Asha Deep II, Mediclaim.

Forms of • Cashless Claim Facility:

TPAs who bear the expenses on behalf of insurance
Health company.
Patients need not to pay directly as a rule – e.g. Bajaj
Alliance.
Insurance

• CBHI (Community Based Health Insurance).

 • It is contract between an insurance company
and an individual or his sponsor (e.g. an
employer).

Characteristics • The contract can be renewable annually or

monthly.
of HI
• The type and amount of health care costs that
will be covered by the health insurance company
are specified in advance, in the member contract
or "Evidence of Coverage" booklet.
 • Premium:
The amount the policy- • Deductible:
holder or his sponsor The amount that the
(e.g. an employer) pays insured must pay out-of-
to the health plan each pocket before the health
month to purchase insurer pays its share.
health coverage.
Terminologies
related to HI • Coinsurance:
Instead of, or in addition • Exclusions:
to, paying a fixed
The insured person is
amount up front (a co-
generally expected to
payment), the
pay the full cost of non-
coinsurance is a
covered services out of
percentage of the total
their own pocket.
cost that insured person
may also pay.
 Terminologies related to HI

• Capitation:
• Coverage limits: • In-Network Provider:
An amount paid by an insurer to a
Some health insurance policies (U.S. term) A health care provider
health care provider, for which the
only pay for health care up to a on a list of providers preselected
provider agrees to treat all
certain amount. by the insurer.
members of the insurer.

• Explanation of Benefits:
A document sent by an insurer to a
patient explaining what was
covered for a medical service, and
how they arrived at the payment
amount and patient responsibility
amount.
 Types of HI

Accidental death
Total permanent
and
disability Vision insurance
dismemberment
insurance
insurance

Long term care Disability

Dental insurance
insurance insurance
 ESI • introduced in
1948(amended in
• Benefits of ESI – Medical benefits
1975, 1984 and
 Health 1989).

Insurance In Sickness benefits -

Extended & Maternity benefit Disability benefit
enhanced

India
Permanent
Dependants benefit Other benefits
disability benefit
 • Unemployment Allowance equal to
50% of wage for a maximum period of
upto one year.
Rajiv Gandhi
Shramik • Medical care for self and family from
ESI Hospitals/Dispensaries during the
period IP receives unemployment
Kalyan allowance.

Yojana
• Vocational Training provided for
upgrading skills - Expenditure on
fee/travelling allowance borne by ESIC.
 CGHS

• Services -
• Established in Outdoor services,
Emergency Domiciliary visits
1954 Indoor services
treatment

Antenatal, natal Supplies optical

Specialist’s Family welfare
and postnatal and dental aids at
consultation services
services reasonable rates

Other services -
Paediatric services
Laboratory and x- Defense Medical
including
ray investigation services , Railway
immunization
Medical Care
 Provider model: NGOs act both as insurer
and provider of health care ser vices.

Insurance model : NGOs is the insurer and

Community care is purchased from a private provider.

Health Intermediary model : NGOs is neither the

insurer nor care provider.

Insurance It acts as an intermediar y between the

target population and the insurance
provider.
 Objective: – To provide health security
for the Below Poverty Line (BPL)
workers in the unorganized sector and
their families through an insurance
that cover for hospital expenses.

RSBY

• Provider: public and private sector.

 • Prevention: prevent diseases through
early detection and doctor recommended
lifestyle changes.

It keeps citizen healthier and saves money

Advantages
Peace Of Mind: If a nagging problem (eg:
unusual pain) persists, they can consult
doctor without expenses

Less Lost Time: Get Sick leave, visit doctor

Issues/limitations
Selection criteria by suppliers
Limited coverage – Only around often restricts the poor
Geographic spread in terms of
10% of the population is
health care facilities and (and more likely to be ill) from
covered through health
financing awareness is limited affordable pre-payment
financing schemes
schemes

Lack of universal schemes –

Moral hazard and Adverse
System leakages – Provider Limitations in terms of coverage
selection – Claims ratios for
malpractices leading to over- of illnesses as well as treatment
Mediclaim and Jan Arogya
charging or preselection / options – Alternative therapies
policies have been in the range
selective recommendation often not considered / included
of 120 – 130%.
under insurance

Disadvantages : Cost, Lack of

choices, Complicated rules,
Limited access
 universal health insurance scheme of the Ministry of
Health and Family Welfare, Government of India.

PMJAY was launched to provide free healthcare

services to more than 40% population of the
country.

The scheme offers a health cover of Rs 5 Lakh.

In this scheme, it covers medicines, diagnostic

expenses, medical treatment, and pre-
hospitalization costs.

Ayushman The poorest families of India can benefit from this

healthcare scheme.

Bharat Yojana
 Aims to provide accident insurance
cover to the people of India.

Pradhan People in the age group of 18 years to 70

years who have an account in a bank
Mantri can avail benefit from this scheme.

Suraksha This policy provides an annual cover of

Rs 2 lakh for total disability and death
Bima Yojana cover and Rs 1 lakh for partial disability.

The policy premium gets automatically

debited from the policyholder’s bank
account.
 It basically covers individuals from the age of 18 years-59
years. 

It also covers the landless citizens who are tenants living both
in urban and rural areas. Basically, the head of the family or
the earning member is the one protected by this scheme.
Aam Aadmi
The premium of 200 rupees per annum is shared equally by
the state and the central government.
Bima Yojana
(AABY) Upon a natural death, the family is compensated at 30000
rupees.

However, upon death caused by a permanent disability, the

family is compensated at 75,000 rupees.
 Four health welfare schemes were launched by the Andhra
Pradesh Government along with the Dr YSR Aarogyasri Trust.

These schemes offer medical cover to different people and

help them at the time of a medical emergency.  

Dr YSR Dr YSR Aarogyasri scheme for the welfare of the poor

Aarogyasri Arogya Raksha scheme is for Above the Poverty Line (APL)

Working Journalist Health Scheme that provides cashless

treatment cover for specified procedures

Employee Health Scheme provides health cover to the state

government employees
 Government With this policy,
health insurance BPL families can
Features and schemes are
offered at a low
also avail of
insurance
price benefits
Benefits of
Government
The policy
Health Insurance The policy
includes
treatment in both
Schemes ensures coverage
for the poor
private and
government
people
hospitals for
better healthcare