Krishnan Ramachandran, MD & CEO, Niva Bupa Health Insurance

India's G20 Presidency marks a significant milestone in its history, as the nation takes on the responsibility of finding practical global solutions for the well-being of all. Our honorable Prime Minister Narendra Modi, during the G20 Summit in Indonesia last year, emphasized the importance of health, alongside food security, energy security, and digital transformation. This recognition of health as a fundamental aspect of India's prosperity is crucial. As we approach the fifth anniversary of Ayushman Bharat - Pradhan Mantri Jan Aarogya Yojana (AB-PMJAY), it is truly a time for celebration and reflection.

A healthy India requires access to clean drinking water, clean air, sanitation, and more. The government's dedicated initiatives such as Jal Jeevan Mission, Swacch Bharat Mission, and National Clean Air Programme have yielded encouraging results and continue to benefit society at large through their multiplier effect. Another notable initiative is Ayushman Bharat (PMJAY), launched as a significant step towards achieving Universal Health Coverage (UHC), ensuring that all individuals have access to quality healthcare services without facing financial hardships. As India remains committed to achieving Universal Health Care for all by 2030, it must be viewed as a collective responsibility.

Healthcare is a Gradient for All

Healthcare for all is an important and a necessary goal for the country. A demographic dividend can only be achieved if we have jobs, skills, and healthy people. The health of a nation not only reflects the well-being of its citizens but also impacts its economic progress. After all, the GDP of a country is dependent on how healthy its population is. Therefore, ensuring healthcare coverage for every citizen is of paramount importance.

According to a recent study by KPMG, 17.3% of people in India spent more than 10% of their household expenditure on healthcare. This resulted in over 5.5 crore Indians being pushed into poverty within a single year due to out-of-pocket expenses (OOPE), with 3.8 crore individuals falling below the poverty line solely due to spending on medicines. These figures are alarming and highlight the urgent need for collaboration and understanding between healthcare and health insurance (HI) stakeholders to promote broader adoption and accessibility.

With India officially becoming the most populous country in the world, achieving UHC becomes an arduous task. Currently, India has a mixed multi-payer universal healthcare model, funded through a combination of public and private health insurance funds, alongside entirely tax-funded public hospitals. The country follows a three-tier healthcare service delivery model, with primary health centers (PHCs) in rural areas, secondary care centers at the district level, and tertiary care centers in most cities. The coexistence of public and private healthcare systems, supported by private investments, will be crucial for ensuring healthcare access across the nation.

Paving the Way for a Future-fit India

To achieve the crucial milestones of Affordability, Accessibility, and Availability (the 3As) on the path to a future-fit India, we must adopt a two-pronged approach that encourages stakeholders to come together in true partnership.

The rising medical inflation and increasing cost of healthcare means that health insurance players need to reassess and revise their premiums periodically to keep up with the high cost of healthcare services. For healthcare providers and hospitals to make health insurance more affordable, they will need to

share the burden, find ways to optimize medical expenses and lean-in more on evidence based medicine.

Another way could be to consider lowering the high 18% GST which is currently levied on health insurance premium, which not only makes in-patients expensive but is also a serious impediment in building out-patient products into health insurance, which actually constitutes around 50-60% of healthcare spends. This creates a mismatch in availing healthcare services directly vis a vis insurance funding.

Simultaneously, it is imperative for the government, healthcare providers, and health insurance players to foster a dialogue by establishing collaborative forums. These platforms can facilitate discussions on past experiences, effective execution strategies, development of collaboration charters, building flexibility for sustained partnerships, and establishing central agencies for evaluating Public-Private Partnership (PPP) models and monitoring their impact. For instance, private partners could develop public sub-centers and primary care centers in a hub-and-spoke model, leveraging telemedicine, point-of-care diagnostics, and IT systems to optimize resource utilization.

Another area of partnership is where the government and health insurance players join forces to standardize healthcare coverage and ensure quality services are available in all 100% of the pin codes across the country. Combining the strengths of both parties can bring economies of scale and foster the emergence and success of new PPP models.

Insurance players, whether public or private, can play a vital role in administering such schemes, while the government takes on the roles of payer and regulator. Many countries have successfully employed insurers to operate part or all of their national health insurance programs. In an insurance or hybrid model, the government can limit its financial liability, reduce managerial costs, enhance scheme monitoring, and benefit from the insurance players' experience in dealing with hospitals and developing robust IT systems to mitigate fraud. Insurance players are subject to prudent regulation by the Insurance Regulatory and Development Authority of India (IRDAI), which ensures compliance and safeguards the interests of beneficiaries and payers.

The role of emerging technologies, for the greater good, cannot be ignored. Technologies such as artificial intelligence, the internet of things (IoT), Blockchain, etc. can provide additional opportunities for facilitating a more holistic digital health ecosystem that can aid in increasing the equitable access to health services, improve health outcomes and reduce costs.

Painting a Picture of Health

The regulator is committed to enable ‘Insurance for All’ by 2047, where every citizen has an appropriate life, health and property insurance cover. To achieve this vision and to democratize quality healthcare, the government, healthcare providers, and insurance players must walk together with the best interests of the end consumer in mind.

It’s about time we realise that we are moving towards the same destination, and our support can be wind to each other’s sails.