THE OTHER day, my office witnessed a commotion. An electrician, while having lunch, suddenly collapsed. He was rushed to a nearby hospital where tests revealed that he had had a brain haemorrhage as well as blocks in his arteries. The hospital didn’t have the expertise to deal with the complicated case and so, after putting him on a ventilator, rushed him to another hospital, which had neurosurgeons and cardiac surgeons on its staff. Meanwhile, the office scrambled to arrange money for the lowly-paid electrician, which could be loaned to his family for medical treatment. The staff hurried to collect all it could, which could be passed on to his family as gift.

Another person’s liver had failed and needed a transplant. His wife came forward to donate but the cost of the treatment was forbidding. He was forced to sell his house to pay the deposit to the hospital. A third case, I remember, is that of a man from a U.P village, who dismantled his house, literally brick by brick, so he could sell the bricks and settle his relatively modest hospital dues.

To put things in perspective, we need to know that "the poor have to increasingly resort to borrowing or selling assets to meet health care costs. It is estimated that 20 million people fall below the poverty line each year because of indebtedness imposed on them by health care. This is worrisome given the fact that more than two-thirds of the country’s population is already either poor or living at subsistence levels."

With the government virtually fading out of the health-care sector under the guise of promoting public-private partnerships, finding alternate options has become imperative. With health insurance seemingly the only viable option to meet health costs in the future, it is important that the penetration of health insurance be improved. Several variations can be explored, including micro-insurance. This is never going to be easy in the unorganised sector. For instance, how do you provide health care to handloom weavers, who are amongst the poorest? There are 6.5 million of them scattered all over the country who are not always fixed in terms of their occupation or location. There is a scheme in operation for them, managed by the Union textiles ministry. But progress in enrolling members is poor. There are many more segments which are far more unorganised than textile workers. If the product is properly customised and the premium subsidised, the government can tap a huge market for health insurance. Currently, the penetration of health insurance is estimated at 0.02 per cent or less of the Gross Domestic Product (GDP).

Like any other nascent industry, the insurance industry has to cope with teething problems, one of the major ones being the inadequate regulatory norms. The unethical norms in hospitals, which routinely over-charge the insured patients and the inability of the insurance companies to ensure rationalisation of tariffs and fees charged are issues not yet resolved. The variance in hospital bills / tariff between the metros and non-metros is unbelievable which leads to a disconnect. It raises insurance premium which then has to be recovered from the customer. In a nascent industry, this will further disincentivise the new customers.

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