health insurance services
• Meaning of health insurance.
• Some of the key terms used.
• History of health insurance.
• Model of total health expenditure.
• Table of different countries for health
expenditure and private health insurance.
• Health insurance in different countries.
• Health insurance in India.
• Table of health care financing
• Typical model of health insurance.
• Proposed model of health insurance.
• Role of private health insurance
• Laws and authorities
• List of Public Sector Banks.
• List of Private banks.
• Coverage of health insurance
• Benefits of health insurance.
• Drawbacks of health insurance.
• How to go for insurance.
Health Insurance: Meaning
• prepayment plan providing services or
cash indemnities for medical care
needed in times of illness or disability.
• all about protection- against an illness.
• Policy – the legal document issued by
the insurance company that outlines the
terms and conditions of the insurance.
• Policyholder – the person who buys
the insurance; also called the "insured."
• Premium – the payment required to
keep your insurance policy in force
• Claim –. a person's request for
payment by an insurer of a loss covered
by a policy
first-party claims- claims to your
own insurance company
third-party claims- claims made by
one person against another person's
• Exclusion – specific conditions or
circumstances listed in the policy that
are not covered by the policy.
• Occurrence – an accident that results
in bodily injury during the period of an
• Peril – the cause of loss or damage.
• Risk – the chance of a loss.
• Underwriting – the process of
selecting risks for insurance, and
determining how much to charge to
insure these risks and which coverage
Health insurance history
• (1883–84) in Germany Compulsory
accident and sickness insurance was
initiated by Otto von Bismarck
• adopted by Great Britain, France,
Chile, the Soviet Union, and other
nations after World War I.
• Act of 1946, In Britain the National
Health Insurance which went into effect
in 1948, provided the most
comprehensive compulsory medical care
individual obtained free medical
attention (participating doctor national
cost was met by the national
government and local taxation
nominal charges for some services
were levied since then
• 1958 the Canadian Hospital and Diagnoses
Act provided full hospital services almost
free of charge in public wards
• more comprehensive coverage added
in 1967( financed by the federal
government ; administered by the
• National health insurance- widely
adopted in Europe and parts of Asia.
• United States –the only Western
industrial nation without
comprehensive national health
involves a fund
pool for future
sources rely on
Total healthTotal health
health ins.health ins.
Using central / stateUsing central / state
revenues for healthrevenues for health
Compulsory premiumCompulsory premium
contributions tocontributions to
Channeling loans,Channeling loans,
grants etc. togrants etc. to
Payments to healthPayments to health
care providers forcare providers for
contributions towardscontributions towards
health supporthealth support
Channeling donationsChanneling donations
etc. to healthcareetc. to healthcare
Most countries have a mix of
public and private role for health
care funding . . .
(% of total)
Nature of PHE* cover PHI**
(% of total)
Australia 68.9 100 • All permanent residents as
enrolled under MediCare (tax-
France 75.8 99.9 • Social security systems
covering all residents
Greece 56.1 100 • All population (financed through
tax and health insurance
Mexico 47.9 50 • Formal worker section and
• Voluntary system for others
Portugal 68.5 100 • All permanent residents as
enrolled under NHS (tax-
UK 80.9 100 • All permanent residents as
enrolled under NHS (tax-
US 44.2 24.7 • Above 65 or disabled
(MediCare), poor (Medicaid) and
poor children (SCHIP)
* PHE: Public health expenditure
** PHI: Private health insurance
The National Health Service (NHS)
• Founded over 50 years ago.
• defining element - principle of equal
• equal access to all necessary medical
services –regardless of their financial
• basic medical services are guaranteed
to all residents of the UK.
• Medical treatment is free.
• free to choose private insurance.
• also possible, to take a full private
Compulsory health insurance
• Health insurance companies
responsible for compulsory health
• These are public corporations.
Régime général d`assurance
• Everyone (a domicile of France)
receives protection through insurance
• Principle of solidarity
• covers financial risks caused by illness,
maternity, disability and death
• offers financial protection in case of
industrial accidents and occupational
• also special health insurances apart
from the general health insurance, for
· self-employed persons, artists and
· farmers (4.2%)
· some occupational groups like sailors,
miners or railway men
• students and persons, who do not belong
to the area of responsibility of a
professional insurance system
• The CMU came into force on January 1,
2000 in order to introduce compulsory
health insurance not connected with any
Lifetime Health Cover
• Lifetime Health Cover is a Government
• health funds charged differently
premiums based on age of member
• recognizes the length of time of private
health insurance -rewards by offering
• People taking hospital cover early in life
charged lower premiums throughout
• No universal health insurance in India
• Limited to industrial workers and their
• Central Govt. Health Scheme(1954)
• Employees state Insurance
• Yet, 80 per cent of Indian
population is without life insurance
• this part of the population subject
to weak social security and
pension systems with hardly any
old age income security.
The proportion of insurance in health care
financing in India is extremely low . . .
Public spending in
health care is
very low at 17%
and the National
Health Policy has
More than 86% of
Source of finance Means of finance
Health care financing in India
Source: WHO. CII-McKinsey. 2003.
Traditional model for health
as the front-
/ Employer/ Employer
Fixed feesFixed fees
Could be allied toCould be allied to
insurer or be ainsurer or be a
to one that allows the flexibility
to serve different segments of
the population, in an efficient
manner . . .
. . .
providers may need
to align themselves
to overall health
care and health
outreach in order
to grow coverage
policy must be
Unemployed /Unemployed /
Government /Government /
Insurers / NGOsInsurers / NGOs::
Processing activities and claims settlementProcessing activities and claims settlement
Insurers / NGOsInsurers / NGOs::
Enrolments and actuarial assessmentEnrolments and actuarial assessment
Insurers / NGOs:Insurers / NGOs:
Community health facilities / health educationCommunity health facilities / health education
funded healthfunded health
The experience of different
countries suggests that private
insurance has an important
role to play in overall health
care . . .
• Private health insurance has enhanced access to
timely hospital care
e.g. In UK, waiting time reduction and private
health insurance coverage have led to a
• Private health insurance has increased service
capacity and supply by injecting financial
resources up front
e.g. In the US, private health insurance has
financed hospitals in terms of doctors and
• Private health insurance increases choice
(provider, benefits, cost-sharing) for the individual
e.g. In Australia, private health insurance offer
the option of access to spare capacity and
elective care in non-public institutions
insurance has led
to expansion of
in other countries
regulation as well
as the role of
• Insurance regulation formally began in
India with the passing of the Life
Insurance Companies Act of 1912 and
the provident fund Act of 1912
• Insurance is a federal subject in India.
There are two legislations that govern
the sector- The Insurance Act- 1938
and the IRDA Act- 1999.
• The General Insurance Corporation has
regulated some of the main health
policies that are offered by the Indian
• United India Insurance Co Ltd.,
• New India Assurance Co Ltd.,
• Oriental Insurance Co Ltd. and
• National Insurance Co Ltd.
Oriental Insurance Corporation, National
India Assurance Corporation, National
United India Insurance Corporation.
• Overseas Mediclaim Insurance
(Employment & Study)
(Corporate Frequent Traveller)
(Business & Holiday)
• Personal Accident Insurance
• Group Personal Accident Insurance
• Jan Arogya Bima Policy
• Medi Claim Policy
Central Govt. Health Scheme
• Provides comprehensive medical care to
central govt. employees
• Mutual advantage to both employee and
• Started in 1954 with 16 allopathic
dispensaries covering 2.3 lac
• Now 320 dispensaries/hospitals in
various systems of medicines covering
42.76 lac beneficiaries
• Provides cash and medical benefits to
• Sickness, maternity and employment
List of private banks
• Bajaj Alliaz
• ICICI Lombard
• National Insurance
• New India
• Oriental Insurance
• Royal Sundaram
• Star Health
insurance cover applies to
1. care through general practitioner
2. care services
3. artificial limbs
4. pharmaceutical products
5. medical aid
6. analysis and laboratory examination
stay and treatment in care facilities
7. rehabilitation clinics and surgical
part of the transportation costs
9. care in case of maternity; also aid care
and hospital stay
10.medical observation of newly born
11.Care services, which are required due
to the state of health, will be covered
for people in need of care.
Benefits of insurance
• timely coverage for regular or at least
with annual health check ups.
• ability to afford for the medical
• Uninsured Pregnant women use lesser
• get screening or preventive services.
key issue related to health care
financing in India
lack of adequate insurance
. .• Limited coverage
– Only around 10% of the population is covered
– Geographic spread in terms of health care
facilities and financing awareness is limited
– Selection criteria by suppliers often restricts
the poor (and more likely to be ill) from
affordable pre-payment schemes
• System leakages
– Provider malpractices leading to over-
charging or pre-selection / selective
• Lack of universal schemes
– Limitations in terms of coverage of illnesses
as well as treatment options
– Alternative therapies often not considered /
included under insurance
The extent of
coverage as well
as the type of
coverage are the
key issues related
have put-off plans
for India due to
in the system
Criticism of insurance companies
• modern insurance companies –
indulging in money-making businesses
with little interest in insurance.
• the purpose of insurance is to spread
risk so the reluctance of insurance
companies to take on high-risk cases to
run counter to the principle of
Other criticisms include:
• Insurance policies contain too many
• Most insurance companies now use call
centres and staff attempt to answer
questions by reading from a script. It is
difficult to speak to anybody with expert
How to go for insurance- basic
• If you are healthy- Basic Health Insurance
• If at hereditary risk/poor health-Critical
-plays lump sum when holder is
diagnosed with one of specified critical
illness.( cancer, CAD, Heart attack, major
organ transplant, paralysis, stroke)
-after lump sum is paid policy
-these policies are far cheaper than
basic health policies, so can’t depend
alone on these.
Bajaj Allianz general
National Insurance Varishtha Mediclaim
New India Assurance Sr. Citizen Mediclaim
Oriental Insurance Health of Privileged Elder
Star Health Allied Sr. Citizen Red Carpet
Sr. Citizen Mediclaim
• Critical Plans-3 types-Rider, Term &
• Senior citizens specific covers
• Family Health Cover- Floater Plans
covers each member separately
gives higher coverage at lower cost
• Disease Specific Plans- covers specific
diseases including pre-existing ones
good as regular checkups are done
regular screening & early detection
ICICI Prulife Cancer, Diabetes
Star Health Diabetes
Below Poverty Line
• Union Budget- 15% hike on Health
• Punjab & Haryana (April 1,2008)
• Arogaya Kosh Yojana under NHIS-2cr
for free diagnostic tests
• Heart ailments, blood diseases, cancer,
ENT, Coronary bypass surgery covered.
• Vikalp Yojana- public-private
partnership, free consultancy and
medicines for registered BPL families in
private hospitals & clinics.
• Growth potential for the insurance
sector is immense.
• Consideration required to poor and
• Private health insurance has positive
role to play.
• Insurance sector needs to widen its
scope from only providing treatment
facilities to promotive and preventive
• World Health OrganizationWorld Health Organization
• Park K.(!8th Edition):Park K.(!8th Edition): Preventive and SocialPreventive and Social
• Rowitz Louis:Rowitz Louis: Public Health for the 21stPublic Health for the 21st
• Merson Micheal H.:International PublicMerson Micheal H.:International Public
• The Tribune
• The Indian Express-Money Express
Special Thanks to Mr.Gurpreet Singh
Senior Relationship Manager