(Guidelines for Reader: Latest Op-Ed First; Verbatim
Compilation of The Hindu Op-Ed; Best to read in the order of oldest to latest
article to get a comprehensive understanding; Consider repetition to be
revision)
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No discrimination: on health insurance in India (28.02.18)
The Delhi High Court’s order striking down a discriminatory exclusion clause in a
health insurance policy, and upholding the claim of a patient, should have the
broader effect of eliminating similar exclusions. The case involved a rare
heart condition based on which United India Insurance Company rejected the
claim, viewing it as a manifestation of a genetic disorder. By its very nature,
such exclusion defeats the purpose of the health policy. But then, policies
sold to individuals invariably contain a plethora of exclusions in the fine
print, diminishing their practical value. They are heavily weighted in favour
of the insurer. The court has struck a blow for the rights of the individual by
holding that exclusion of the kind invoked does not just involve a contractual
issue between the two sides, but the basic right to health flowing from Article
21 of the Constitution. It has gone further to interpret the right to health as
being meaningful only with the right to health care, and by extension, health
insurance required to access it. This is good advice. The Centre, which has
committed itself to a universal National Health Protection Scheme, and the
Insurance Regulatory and Development Authority would do well to heed it. They
must review all the policies, and eliminate unreasonable exclusionary clauses
designed to avoid claims.
Several studies have pointed out that health
insurance in India suffers from lack of scale, covering only about 29%
of the households surveyed under the National Family Health Survey-4, that too
in a limited way. The health-care system also lacks regulation of costs. There
is asymmetry of information, with the insured member unable to assess the real
scope of the policy or negotiate the terms with the provider. Questions such as
these led to the enactment of a new health-care law in the United States during
the Barack Obama administration, whereby strict obligations were placed on
insurers and unreasonable exclusions removed. India’s health insurance and
hospital sectors closely follow the American pattern, and are in need of strong
regulation. This is necessary to define costs, curb frauds and empower
patients. As the Delhi High Court has observed, exclusions cannot be unreasonable
or based on a broad parameter such as genetic disposition or heritage.
Insurance law has to be revisited to also ensure that there is a guaranteed
renewal of policies, that age is no bar for entry, and pre-existing conditions
are uniformly covered. Problems of exclusion will be eliminated if the
payer-insurer is the state, the financing is done through public taxes, and
coverage is universal. Given its stated intent to ensure financial protection
against high health costs, India should adopt such a course. The short-term
priority is to remove discriminatory clauses in policies and expand coverage to
as many people as possible.
XXX
Case histories: On National Health Protection Scheme
(17.02.18)
The government’s intention to launch the world’s largest
health insurance programme, the National Health Protection Scheme, raises an
important issue. Should the focus be on the demand side of health-care finance
when the supply side, the public health infrastructure, is in a shambles?
Experience with insurance schemes, such as the Centre’s Rashtriya Swasthya Bima
Yojana and Andhra Pradesh’s Rajiv Aarogyasri, show how demand side
interventions can miss the mark. While the RSBY and Aarogyasri did improve
access to health-care overall, they failed to reach the most vulnerable
sections. At times they led to unnecessary medical procedures and increased
out-of-pocket expenditure for poor people, both of which are undesirable
outcomes. These showed that unless the public health system can compete with
the private in utilising funds from such insurance schemes, medical care will
remain elusive for those who need it most. Policymakers behind the NHPS, which
will cost the government around ₹5,000 crore in its
first year, must take heed.
Both RSBY and Aarogyasri are cashless hospitalisation
schemes. While both benefited people living below the poverty line,
over-reliance on private hospitals and poor monitoring watered down their
impact. According to one Gujarat-based study, a majority of RSBY insured
patients ended up spending about 10% of their annual income during hospitalisation,
because hospitals still charged them, unsure as they were when they would be
compensated. A study in Andhra Pradesh found that beneficiaries spent more from
their own pockets under Aarogyasri. They spent most of their money on
outpatient care, and Aarogyasri didn’t tackle this adequately. Possibly the
most problematic fallout was mass hysterectomies done in Andhra Pradesh.
Between 2008 and 2010, private hospitals removed the uteri of thousands of
women unnecessarily, to make a quick buck. Thus, perverse incentives can drive
the private sector to sabotage schemes that are not well monitored. The second
problem with over-reliance on the private sector is that it limits the reach of
such programmes. Evidence from RSBY and Aarogyasri shows that as distance from
empanelled hospitals grew in Andhra and Gujarat, fewer people benefited from
them — most empanelled hospitals are private and urban. Scheduled Tribe and
rural households typically missed out, while richer quintiles of the population
benefited. There can be much gained from the NHPS if the government views it as
the first step towards universal health care, rather than a panacea to all of
India’s health-care woes. The second, and a long-awaited, step is to reform the
public health system. Without this, an insurance scheme, no matter how
ambitious, will be a band-aid.
XXX
Medicare is not healthcare (11.02.18)
Insurance is fine but infrastructure is crucial
What was perhaps the biggest announcement in the Budget
didn’t actually involve any money. The National Health Protection Scheme,
touted as the world’s largest healthcare programme, envisages providing medical
insurance cover of up to ₹5 lakh each to 10 crore families.
Assuming an average family size of five members, this translates to 50 crore people,
or nearly 40% of the population.
This is a stupendous goal by any yardstick, and the first
near-universal welfare measure in the health sector since possibly the 1980s,
when governments, constrained by tightening resources and burgeoning populations,
switched focus to targeting just the vulnerable sections of society, while
leaving it to the private sector to take care of the rest.
And, as many have pointed out already, the Finance Minister
did not allocate any money for this; he only promised to raise the resources
when required.
A good idea?
I, for one, am willing to take Arun Jaitley at his word. I
am willing to grant that when the time comes, North Block mandarins will pull
some legerdemain and actually find the money to fund the share of the premium
which the Centre will have to pay. Of course, if the contours of similar
schemes in the past are any indication, this will still amount to only around
40% of the total required, with the balance to be funded by the States (health
is a State subject, after all).
I am even willing to assume that the States too will fall in
line and cough up the amount required, since aspirations have been already
unleashed on this front and it will be difficult for any political party to
swim against the tide and refuse to pay. So, assuming that the money is found
and the insurance policies go live in a year or two, does this mean that a
significant chunk of the population will be able to afford quality healthcare
when they need it? Given the fact that out-of-pocket expenditure on healthcare
is nearly 63% of the country’s total healthcare expenditure (one of the highest
in the world — it’s 32% in China, 11% in the U.S. and the world average is
18.2%), and “catastrophic expenditure” on healthcare pushes millions back into
poverty every year in India, an insurance scheme which provides up to a ₹5 lakh cover sounds like a great idea.
Or is it? There is one crucial difference between Medicare
assistance (even of the Obamacare variety) and actual healthcare services. The
former is a financial product which focuses on enabling beneficiaries to access
existing healthcare facilities. It does not in itself ensure the creation of
healthcare infrastructure — somebody will still have to build
clinics/hospitals, staff them with doctors, nurses, medicines and equipment,
and provide these at a cost which falls within the limits of the healthcare
insurance policy.
The real challenge
This is where India has been slipping badly. For instance,
it had only about 1,800 hospitals in rural areas, according to the government’s
rural health statistics for 2017. The shortfall in percentage terms vis-à-vis
the population (based on the 2011 Census) is 19% in terms of sub-centres, 22%
in terms of primary health centres and 30% in terms of community health
centres. As of March 2017, the number of buildings required to be constructed
to meet requirements had crossed 40,000.
Worse, even if the buildings exist, they are often just that
— shells, without the requisite staff. According to the Niti Aayog’s latest
State-wise healthcare index, the proportion of vacant specialist positions
(medicine, surgery, obstetrics and gynaecology, paediatrics, anaesthesia,
ophthalmology, radiology, pathology, ear-nose-throat, dental, psychiatry)
ranged from a low of 16.7% in Tamil Nadu (among the larger States clustering)
to a staggering 77.7% in Chhattisgarh as of 2015-16. When it came to the
availability of a doctor at primary health centres, even the best-performing
States like Kerala and Tamil Nadu had 5.9% and 7.6% respectively, while over
41% of the primary health centres in West Bengal, Chhattisgarh and Jharkhand
didn’t have a doctor available; this was 63.6% in Bihar. About half the primary
and community health centres in Rajasthan, Haryana and Bihar did not even have
a staff nurse; in Jharkhand it was 74.9%.
Given this dismal scenario, merely providing the amount is
not enough. True, creating a potential addressable medical services consumer
base worth ₹50 lakh crore will work as a tremendous
incentive to the creation of such infrastructure in the private sector,
but this will take time. Besides, the private sector will face the same
challenges of getting trained medical professionals to work in remote and rural
locations. It can, of course, pay more money to such people as incentive, but
that again will push up costs.
The real challenge then remains unchanged: to create the
physical healthcare infrastructure on the ground, equip it, staff it, and run
it. The last is important. About a quarter of primary health centres in the
country, for instance, do not have access to 24-hour power supply, and nearly a
fifth don’t have water supply. After that comes the issue of meeting the costs.
XXX
Making health insurance work (06.02.18)
It is unusual for a health programme to become the most
prominent feature of a Union Budget. The previous government missed the bus
when it failed to implement the recommendations of the High-Level Expert Group
on Universal Health Coverage (2011). Yet, those recommendations resonate in the
Budget of 2018, with commitment to universal health coverage, strengthening of
primary health care (especially at the sub-centre level), linking new medical
colleges to upgraded district hospitals, provision of free drugs and
diagnostics at public health facilities, and stepping up financial protection for
health care through a government-funded programme that merges Central and State
health insurance schemes.
Whatever be the time and resources needed to fully implement
these initiatives, the Budget sends a strong message that health is now in the
spotlight of politically attractive policy pronouncements. From now on, no
government can ignore people’s legitimate aspiration to get the health services
they desire and deserve. However, health care is not just a matter of health
insurance, involving as it does many other elements such as the availability of
a multi-layered, multi-skilled health workforce. Further, there is health
beyond health care, dependent on many social determinants.
The NHPS, operationally
The scheme will provide cost coverage, up to ₹5 lakh annually, to a poor family for hospitalisation in an
empanelled public or private hospital. The precursor of the National Health
Protection Scheme (NHPS), the Rashtriya Swasthya Bima Yojana (RSBY), provided
limited coverage of only ₹30,000, usually for secondary
care. Though it improved access to health care, it did not reduce out-of-pocket
expenditure (OOPE), catastrophic health expenditure or health payment-induced
poverty. The NHPS addresses those concerns by sharply raising the coverage cap,
but shares with the RSBY the weakness of not covering outpatient care which
accounts for the largest fraction of OOPE. The NHPS too remains disconnected
from primary care.
The NHPS will pay for the hospitalisation costs of its
beneficiaries through ‘strategic purchasing’ from public and private hospitals.
This calls for a well-defined list of conditions that will be covered, adoption
of standard clinical guidelines for diagnostic tests and treatments suitable
for different disorders, setting and monitoring of cost and quality standards,
and measuring health outcomes and cost-effectiveness. Both Central and State
health agencies or their intermediaries will have to develop the capacity for
competent purchasing of services from a diverse group of providers. Otherwise,
hospitals may undertake unnecessary tests and treatments to tap the generous
coverage. The choice of whether to administer NHPS through a trust or an
insurance company will be left to individual States.
Reduced allocation for the National Health Mission and
sidelining of its urban component raise concerns about primary care, even
though the transformation of sub-centres to health and wellness centres is
welcome. If primary health services are not strong enough to reduce the need
for advanced care and act as efficient gatekeepers, there is great danger of an
overloaded NHPS disproportionately draining resources from the health budget.
That will lead to further neglect of primary care and public hospitals, which
even now are not adequately equipped to compete with corporate hospitals in the
strategic purchasing arena. That will lead to decay of the public sector as a
care provider. This must be prevented by proactively strengthening primary
health services and public hospitals.
How will it work financially?
The NHPS is not a classic insurance programme, since the
government pays most of the money on behalf of the poor, unlike private
insurance where an individual or an employer pays the premium. However, the
scheme operates around the insurance principle of ‘risk pooling’. When a large
number of people subscribe to an insurance scheme, only a small fraction of
them will be hospitalised in any given year. In a tax funded system or a large
insurance programme, there is a large risk pool wherein the healthy cross-subsidise
the sick at any given time. The NHPS will be financially viable, despite a high
coverage offered to the few who fall sick in any year, because the rest in the
large pool do not need it that year.
However, the NHPS will need more than the ₹2,000 crore presently allocated. As the scheme starts in
October 2018, the funding will cover the few months before the next Budget. It
is expected to require ₹5,000-6,000 crore to get it going in the
first year and ₹10,000-12,000 crore annually as it scales up. It will
draw additional resources from the Health and Education Cess and also depend on
funding from States to boost the Central allocation. The premiums are expected
to be in the range of ₹1,000-1,200 per annum. They may be
lowered if enrolment is high but will rise if utilisation rates are
high.
What will the States do?
In all the excitement about the Union Budget’s proposal of
the NHPC, it is easy to forget that State governments have the main
responsibility of health service delivery and also need to bear the major share
of the public expenditure on health. The National Health Policy (NHP) asks the
States to raise their allocation for health to over 8% of the total State
budget by 2020, requiring many States to double their health spending. Will
they be stimulated to do so, when the Central Budget has not signalled a
movement towards the NHP goal of raising public expenditure on health to 2.5%
of GDP by 2025?
The NHPS needs a buy-in from the States, which have to
contribute 40% of the funding. Even with the low cost coverage of the RSBY,
several States opted out. Some decided to fund their own State-specific health
insurance programmes, with distinctive political branding. Will they agree to
merge their programmes with the NHPS, with co-branding? Will other States, who
will also contribute 40% to the NHPS, demand similar co-branding? In a federal
polity with multiple political parties sharing governance, an all-India
alignment around the NHPS requires a high level of cooperative federalism, both
to make the scheme viable and to ensure portability of coverage as people cross
State borders. For the sake of all Indians, let us hope an all-party consensus
develops around how to design and deliver universal health coverage, starting
with but not stopping at the NHPS.
K. Srinath Reddy is President, Public Health Foundation
of India. Views are personal
(All of the above
articles have been taken straight from The Hindu. We owe it all to them. This
is just an effort to consolidate opinions expressed in The Hindu in a
subject-wise manner.)
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