How Health Insurance in India has Evolved Over the Last 3 Decades?

The concept of insurance dates back to ancient times when people pooled risks according to their needs. But it wasn't until the 1990s that health insurance officially emerged. In this insurance, risk pooling was structured to account for the losses of the smaller party. Health insurance helps protect a person from financial losses that may be incurred as a result of an accident or disability. Studies show that in 2004, nearly 39 million people were impoverished by out-of-pocket medical costs, compared to 26 million in 1993-94. That number increased to 55 million, he said, from 2011 to 2012, with the country's own spending on health reported at 60%, among the highest in the world. With the help of health insurance, people can protect themselves from the invisible financial burdens associated with family health. 

In India, insurance is considered a federal subject regulated by the Insurance Act, of 1938 and the Insurance Regulatory and Development Authority Act, of 1999. Nevertheless, India lags behind many other developing countries. After India's independence, the availability of modern medical facilities and effective training of medical staff expanded and modernized the healthcare system. Rising income, health awareness, and private players are the main reasons for the growth of health insurance.

The below study is a chronological review of the changes that have come through in the health insurance sector over the last 3 decades.

Between 1990 and 2000

 Studies conducted between 1990 and 2000 focused on public health spending and public-private partnerships that benefited poor patients. High rates of untreated disease were found in rural areas and relied on private facilities for outpatient care. During this decade, the health insurance industry saw a need for private enterprise. This suggests that this is leading to increased penetration and density.  

Between 2000 and 2005

 Studies conducted between 2000 and 2005 focused on regulatory mechanisms and strategies for the uptake of health insurance. The review concluded that the role of node agencies, NGOs, and community health insurance is viable and essential for the overall growth of the sector. It also emphasized the role of various stakeholders, including governments, regulators, and insurance companies, in raising financial resources and protecting the poor. 

Between 2006 and 2010

Demographic factors started to come into play in the late 2000s. Income became a key factor, as high-income earners were found to be more likely to have health insurance than relatively low-income earners. Families with more children pay more for health insurance. The main challenges during this period were high system costs and the need for government intervention, which remained prevalent. These studies suggest that patients without or without health insurance are more likely to be discharged in poor health and are less satisfied than those with health insurance. Also, private health insurance customers were more satisfied than public health insurance customers, so the public health system had to be of higher quality to compete with the private sector.

2011 and Beyond

Studies conducted after 2010 emphasized factors such as infrastructure and technology. State intervention and the need for more sophisticated regulatory mechanisms still prevail. With digitization giving people access to all the information they need and being more conscious than ever, this era is shifting to service quality and customer satisfaction. Foreign investment continues to produce positive results, with research suggesting that they are helping to raise the standards and quality of necessary infrastructure and technology upgrades and generally create employment opportunities. 

According to this study, factors such as policy costs, income, and competition became more competitive around 2010 as the health insurance sector became more competitive and the private sector developed differentiated products to capture the market. became important. But as customer satisfaction and infrastructure became key issues, the health insurance sector was also digitized, allowing people to pay premiums and track policies online. 

Consumption using the World Wide Web users can compare different policies available and make the right decision. The survey found that one of the major problems in the health insurance industry is insurance for the poor, the public who may have to deal with financial hardships if not covered by formal and organized insurance. It also became clear that the necessary steps had to be taken to reach the insurance system. However, the  Ayushman Bharat program introduced by the government has brought significant changes to the health insurance sector in India. 

In 2016, 80% of India's population had neither private nor public health insurance. However, the government has established the Rashtriya Swashtya Bima Yojana (RSBY) for unorganized workers, organized workers, and civil servants under the Employee State Insurance Scheme (ESIS) and the Central Government Health Scheme (CGHS), provided about 12% of the urban population and 13% of the rural population respectively. 

The sector is growing exponentially and will continue to grow given the importance and public awareness of health insurance as a system.

Conclusion

One of the important conclusions deduced is that the health insurance assiduity has overall become multi-faceted and there can not be one aspect of its development but numerous factors that are interlinked and interrelated. It continues to expand and be technologically driven in order to reach millions and to insure high-quality and cost-effective services.