NITI Aayog has released a comprehensive report titled ‘Health Insurance for India’s Missing Middle’, which brings out the gaps in the health insurance coverage across the Indian population and offers solutions to address the situation.
The primary purpose of this report is to recognize the policy issue of low financial protection for health in the ‘missing middle’ segment.
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In doing so, the report offers a starting point for broader discussions on solutions, and specific products, to improve insurance coverage for the missing middle. The report has recommended three models for increasing the health insurance coverage in the country.
The first model focuses on increasing consumer awareness of health insurance. While the second model is about developing a modified, standardized health insurance product like Arogya Sanjeevani, a standardized health insurance product launched by the Insurance Regulatory Development Authority of India in April 2020. A “slightly modified version” of the standardisedAarogyaSanjeevani insurance product will help increase the update amongst the missing middle, the report said. The modified product should have lower waiting periods. It should also include out-patient benefits through a subscription model to increase the value of healthcare provided, it said.
The third model, the report said, “The third model expands government-subsidized health insurance through the PMJAY scheme to a wider set of beneficiaries. This model can be utilized for segments of the missing middle which remain uncovered, due to limited ability to pay for the voluntary contributory models outlined above. This is the only model out of three proposed which has fiscal implications for the Government. Though this model assures coverage of the poorer segments on the missing middle population, premature expansion of PMJAY can overburden the scheme.”
A combination of the three models, phased in at different times, can ensure coverage for the missing middle population, said the report.
In the short-term, the focus should be on expanding private voluntary insurance through commercial insurers. In the medium-term, once the supply-side and utilization of PMJAY and ESIC is strengthened, their infrastructure can be leveraged to allow voluntary contributions to a PMJAY plus product, or to ESIC’s existing medical benefits.
In the long-term, once the low-cost voluntary contributory health insurance market is developed, the expansion of PMJAY to the uncovered poorer segments of the missing middle should be considered.
NITI Aayog has suggested that the PMJAY scheme be extended to cover a section of people without health insurance. Approximately 30 percent of the population, or 40 crore individuals called the ‘missing middle’ are devoid of any financial protection for health.
It said, The Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) launched in September 2018, and State Government extension schemes, provide comprehensive hospitalization cover to the bottom 50% of the population around 70 crore individuals. Around 20% of the population of 25 crore individuals are covered through social health insurance, and private voluntary health insurance. The remaining 30% of the population is devoid of health insurance; the actual uncovered population is higher due to existing coverage gaps in PMJAY and overlap between scheme
The report has also suggested sharing the government scheme data with private insurance companies. Government databases such as National Food Security Act (NFSA), Pradhan Mantri Suraksha Bima Yojana, or the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) for agricultural households can be shared with private insurers after taking consent from these households, the report said, suggesting an outreach strategy. “Such databases will help ease the identification of, and outreach to potential customers by insurers,” the report said.
Source: The Indian Express