The document provides an overview of health policy and the health system in India. It discusses the history of public health in India from traditional Ayurvedic approaches to modern Western influences. The health system is described as having a complex mix of public and private sectors. Key aspects covered include the administrative structure from central to local levels, service delivery network from sub-centers to hospitals, and health financing relying heavily on out-of-pocket payments. While India produces many medical professionals and medicines, health indicators remain poor and inequitable across socioeconomic groups.

1. HEALTH
POLICY IN
INDIA
Presented by :ARIF KHAN1

2. CONTENT:
 HISTORY OF Public Healthin India
 Health Systemin India
 Health Financing in India
2

3. HISTORY OF PUBLIC
HEALTH IN INDIA

4. HEALTH
 The World Health Organisation defines
Health (of an individual) as the state of
complete physical mental and social well-
being and not merely the absence of disease
or infirmity.
 World Health Organisation, however, does
not define Public Health.

5. DEATH
 Death, on the planet Earth, is inevitable.
 A large number of deaths are premature.
 A substantial proportion of deaths can be
avoided.
 Public Health is related to preventing premature
and unavoidable deaths.

6. A MODEL OF HEALTH
Exposure to Risk
Factors
Body resistance
Poor Health
Manifestation
Disease
Condition
Disability Death

7. PUBLIC HEALTH
 Public Health deals with the group of people
rather than individuals.
 Dimensions of public health
 Health promotion
 Disease prevention
 Early diagnosis and prompt treatment
 Disability limitation
 Rehabilitation

8. TRADITIONAL INDIAN APPROACH
 The Indian approach to health is enshrined in
the concepts and principles of Ayurveda
which means the ‘science of life’.
 Ayurveda is one of the oldest system of
health care in the World.
 Ayurveda deals with both preventive and
curative aspects of health.
 Health defined by WHO is very similar to
concepts of Ayurveda.

9. WESTERN APPROACH
 The western approach of avoiding diseases,
death and disability, traditionally focused on
personal hygiene and public sanitation during
the 19th Century.
 This approach, combined with better food
availability, paid rich dividend in the
developed countries in reducing morbidity
and mortality.

10. COMPONENTS OF PUBLIC HEALTH
 Epidemiology
 Measurement of disease conditions in relation to
the population at risk.
 Statistics
 Collection, presentation, analysis and
interpretation of epidemiological data.
 Health Services
 Services directed towards meeting the health
needs of the people.

11. PUBLIC HEALTH IN INDEPENDENT INDIA
 Evolution of public health care system in
Independent India was shaped by two
important factors:
 The Report of First Health Survey and
Development Committee (Bhore Committee)
constituted during the colonial rule.
 Emergence of modern medical technology for
the prevention and control of diseases,
especially communicable diseases.

12. BHORE COMMITTEE
 Appointed in 1943.
 Recommended comprehensive remodeling
of health services.
 Integration of preventive and curative health
services at all levels.
 Hospital-based health care system.
 Development of primary health centres in two
stages.
 Training in Preventive and Social Medicine.

13. BHORE COMMITTEE
 The short-term plan
 A PHC for every 40000 population.
 PHC to be manned by 2 doctors, 4 PHN, 4
Midwife, 1 Nurse, and others.
 The long-term plan
 A primary health unit for every 10-20 thousand
population with 75 beds.
 Secondary unit with 650 bedded hospital.
 District unit with 2500 bedded hospital.

14. PUBLIC HEALTH IN INDEPENDENT INDIA
 The recommendations of Bhore Committee
and the availability of preventive and curative
medical technology resulted in the evolution
of hospital-based public health system.
 The public health arrangements created
during the colonial period were replaced by
hospitals and health centres.
 Public health services were merged with the
medical services.

15. PUBLIC HEALTH IN INDEPENDENT INDIA
 Bhore Committees recommendations were
accepted only partially.
 One primary health centre for every 30 thousand
population.
 Only 6 beds in each primary health centre.
 Only one doctor.
 Truncated paramedical staff.
 The situation has remained largely
unchanged.

16. PUBLIC HEALTH IN INDIA
 Mukherjee Committee (1965)
 Separate staff for family planning programme.
 Malaria activities to be de-linked from family
planning activities.
 Jungalwala Committee (1967)
 A unified approach for all problems instead of a
segmented approach for different problems.
 Medical care and public health programmes to
be put under charge of a single administrator.

17. PUBLIC HEALTH IN INDIA
 Bajaj Committee
 Formulation of National Medical & Health Education
Policy.
 Formulation of National Health Manpower Policy.
 Educational Commission for Health Sciences.
 Health Science Universities in various states.
 Health manpower cells.
 Vocationalisation of education at 10+2 levels as
regards health related fields.
 Realistic health manpower survey.

18. PUBLIC HEALTH IN INDIA
 Public health in India is ‘hospitalised.’
 Health planning is concerned more with the
health of the health care delivery system
(hospitals and health centres) then the health
of the people.
 The remedy was sought in terms of specific
National health and disease control
programmes.
 There are numerous such programmes.

19. PUBLIC HEALTH IN INDIA
 Reproductive and child health programme.
 National tuberculosis control programme.
 National malaria control programme.
 National blindness control programme.
 National water born disease control
programme.
 National leprosy eradication programme.
 National iodine deficiency control
programme.

20. PUBLIC HEALTH IN INDIA
 All National disease control programmes are
implemented through the existing
government hospitals and health centres.
 Over the years, a campaign approach has
been evolved to implement many of the
national health and disease control
programme.
 Successful campaigns have often been
followed by unsuccessful maintenance.

21. PUBLIC HEALTH IN INDIA
 Focus on medical services.
 Neglect of public health services.
 No modern public health regulation.
 Lack of systematic planning.
 Poor sustainability of public health efforts.
 Absence of epidemiological and statistical skills
at district and below district level.
 No micro-level planning, no public health action.

22. ESSENTIAL PUBLIC HEALTH FUNCTIONS

23. ESSENTIAL PUBLIC HEALTH FUNCTIONS IN INDIA
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8
Health situation
Epidemiological surveillance
Health promotion
Regulation
Participation
Policy and planning
Evaluation
Human resources
Quality
Research
Management capacity
Emergencies and Distasters

24. HEALTH SYSTEM IN
INDIA

26. INTRODUCTION
 The political economy context
 The organisational structure and delivery
mechanism
 Health financing mechanisms
 Coverage patterns
 Current status of health and health care

27. THE POLITICAL ECONOMY CONTEXT
 A democratic federal system which is subdivided into
28 States, 7 union territories and 593 districts
 In most of the states three local levels of government
(Panchayati-raj)
 Per capita income US $440
 435 million Indians are estimated to live on less than US $ 1 a
day
 36% of the total number of the worlds’ poor are in India
 Tax based health finance system with health insurance
 80% health care expenditure born by patients and their
families as out-of -pocket payment (fee for service and drugs)
 Expenditure on health care is second major cause of
indebtedness among rural poor

28. CHARACTERISTICS OF INDIAN HEALTH SYSTEM
 Complex mixed health system
- Publicly financed government
health system
- Fee-levying private health sector

29. DIFFERENT PHASES OF INDIAN HEALTH SYSTEM
DEVELOPMENT
 Pre-independence phase
 Development centred phase
 Comprehensive Primary Health Care
phase
 Neoliberal economic and health sector
reform phase
 Health systems phase

30. MAIN SYSTEMS OF MEDICINE
 Western allopathic
 Ayurveda
 Unani
 Siddha
 Homeopathy

31. GOVERNMENT HEALTH SYSTEM
 Three levels of responsibilities-
- First-
- health is primarily a state responsibility
- Second-
- the central government is responsible for developing and
monitoring national standards and regulations
- sponsoring various schemes for implementation by state
governments
- providing health services in union territories
- Third-
- both the centre and the states have a joint responsibility
for programmes listed under the concurrent list.

32. ADMINISTRATIVE STRUCTURE
1. Central Ministries of Health and Family
Welfare –
- Responsible for all health related
programmes
- Regulatory role for private sector
2. State Ministries of Health and Family
Welfare
3. District Health Teams headed by Chief
Medical and Health Officer

33. SERVICE DELIVERY STRUCTURE
 Sub Health Centres- staffed by a trained female
health worker and/or a male health worker for a
population of 5000 in the plains and a population of
3000 in hilly and tribal areas.
 Primary Health Centres-
staffed by a medical officer and other paramedical staff
for a population of 30,000 in the plains and a population
of 20,000 in hilly, tribal and backward areas. A PHC
centre supervises six to eight sub centres.

34. SERVICE DELIVERY STRUCTURE
 Community health centres- with 30-50 beds
and basic specialities covering a population
of 80,000 to 120,000. The CHC acts as a
referral centre for four to six PHCs.
 District/General hospitals- at district level
with multi speciality facilities (City
dispensaries)
 Medical colleges, All India institute of Medical
Sciences and quasi government institutes
(NIHFW and SIHFWs)

35. HEALTH FINANCING MECHANISMS..
 Revenue generation by tax
 Out of pocket payments or direct payments
 Private insurance
 Social insurance
 External Aid supported schemes

36. SPENDING ON HEALTH
 Annually over 150,000 crores or US$34 billion, which is
6% of GDP (Government spending on health Is only
0.9% of GDP)
 Out of this only 15 % is publicly financed 4% from
social insurance, 1% by private insurance remaining
80% is out of pocket spending ( 85% of which goes in
private sector)
 Only 15% of the population is in organised sector and
has some sort of social security the rest is left to the
mercy of the market

37. THE ASPECTS OF NEOLIBERAL ECONOMIC
REFORMS AFFECTING PUBLIC HEALTH
 Increasing unregulated privatisation of the health care
sector with little accountability to patients
 Cutting down government Health care expenditure
 Systematic deregulation of drug prices resulting in
skyrocketing prices of drugs and rising cost of health
services
 Selective intervention approach instead comprehensive
primary health care
 Measure diseases in terms of cost effectiveness
 Techno centric approach( emphasis on content instead
processes)

38. CONTRADICTIONS
 India has the largest numbers of medical
colleges in the world
 It produces the largest numbers of doctors
among developing countries
 It gets “medical Tourists” from developed
countries
 This country is fourth largest producer of
drugs by volume in the world

39. BUT... THE CURRENT SITUATION….
 Only 43.5% children are fully immunised.
 79.1% of children from 6 months to 5 years of age are
anaemic.
 56.1% ever married women aged 15-49 are anemic.
 Infant Mortality Rate is 58/1000 live births for the country with
a low of 12 for Kerala and a high of 79 for Madhya Pradesh.
 Maternal Mortality Rate is 301 for the country with a low of
110 for Kerala and a high of 517 for UP and Uttaranchal in the
2001-03 period.
 Two thirds of the population lack access to essential drugs.
 80% health care expenditure born by patients and their
families as out-of -pocket payment (fee for service and drugs)
 Health inequalities across states, between urban and rural
areas, and across the economic and gender divides have
become worse
 Health, far from being accepted as a basic right of the people,
is now being shaped into a saleable commodity

40. CONTD….
 poor are being excluded from health services
 Increased indebtedness among poor
(Expenditure on health care is second
major cause of Indebtedness among
rural poor)
 Difference across the economic class spectrum and
by gender in the untreated illness has significantly
increased
 Cutbacks by poor on food and other consumptions
resulting increased illnesses and increasing
malnutrition

41. HEALTH INEQUITIES
 The infant mortality Rate in the poorest 20% of the
population is 2.5 times higher than that in the richest
20% of the population
 A child in the ‘Low standard of living’ economic group is
almost four times more likely to die in childhood than a
child in a better of high standard living group
 A person from the poorest quintile of the population,
despite more health problems, is six times less likely to
access hospitlisation than a person from richest
quintile.

42. HEALTH INEQUITIES
 A girl is 1.5 times more likely to die before
reaching her fifth birthday
 The ratio of doctors to population in rural
areas is almost six times lower than that for
urban areas.
 Per person, government spending on public
health is seven times lower in rural areas
compared to government spending urban
areas

44. Health :-
A state of complete
physical, mental, and social well-
being and not merely the absence
of disease or infirmity.

45. Introduction :-
Health care system is initially started from central
government of India. The scope of health services
is varies widely from country to country and
influenced by general and ever changing national,
state And local health Problem, need attitude as
well as available resources.
45

46. Health care should be :-
Accessible
Acceptable
Provide scope for community participation
Comprehensive
Affordable at low cost
46

47. 47
Resources:-
Man power
Money power
Material power

48. 48
Organization and administration of health services in india
at different level.
National level
State an union territories
District health organization and basic specialties hospital/districts
Community health sub-districts/
Centers taluka hospital
P.H.C
Sub centers
Village health
Guides
People in
Population

49. At central level:-
Union ministry of health and family
The director general of health services
The central council of health and family
welfare

50. 50
Union ministry function
International heath relation and administor of port-quarantine
Administration of central health institutes such as “all India
institute of hygiene”
Promotion of research through research centers and other bodies
Regulation and development of medical, nursing and other allied
health promotion
Establishment and maintains of the drug
Census and collection and publication of other statistical data
Immigration and migration
Regulation of labor in the working in mines

51. 51
Director general of health services
General function :-
the general function are survey planning, co-
ordination, programme and appraisal of all health
matters in the country
Specific funtion :-
international health relation and
quarantine
control of drug standards
medical stores depots
post graduation training
medical education
medical research
central govt. health scheme

52. 52
Central council health function are :-
Environmental hygiene, nutrition,
education, promotion, research
Making the proposal
Distribution sources to the state level
Promoting and maintain between central
and state level

53. Panchayti Raj :-
 it is rural administration
It is last phase in the system of the health care structure
Three institution of panchayati Raj are following:-
1) Panchayat :-(at village level)
1) Panchayat Samiti:- (at block level)
2) Zilla parishad :- (at district level)

54. 1)Panchayat :-
Gram sabha:-
They meet at least twice in a year and elected the
member of gram panchayat
 gram panchat :-
 it constitude on the popullation of 5,000 to 15,000
15 to 30 panch as members
Headed by surpanch
It term upto 3 to 5 year
 nyaya panchat
 it villages platform to resolves the disputes between
villages /local group
Mainting peace among people

55. 2)Panchayat samiti :-
It consist of 100 villages
Covering 80,000 to 1 lack people
It consist of all surphanchs
B.D.O. headed
3) Zilla parishad at the district level
 collector also member of this team but not right of voting
Nearest 70 to 80 members
Mainly supervising by collector

56. 56
Primary health care :-
Launched in 1977 base on rural health scheme
The principle is “placing people health in
people hand”
1983 national health policy based on PHc
approved by parliament
1)Village level
a) village health guide scheme
b) training of local dais
c) ICDS scheme(Anganwadi worker)
2)Sub centre
3)P.H.C

57. 57
a)Village level
one of the basic tends of primary health care.
implement the policy of primary care following
scheme are operating:-
Village health guides:-
a person with an aptitude for social services
and it not full time government functionary.
This scheme introduced on 2nd oct 1977
In May 1986 male guide replaced by female
health guides
They provide the first contact between the
individual and the health systems

58. 58
The guidelines for their selection are:-
they should be permanent residents of the
local community, preferably women
they should be able to read and write having
minimum formal education at least 10th
standard
Should be accept all section of the community
They should be spare at least 2 to 3 hrs every
day
Training for health guide:-
At the PHC
Duration 200 hrs
for 3 months
received stipend Rs. 200/month

59. 59
Providing knowledge and training
Knowledge is emphasize on elementary concepts of maternal and
child health and sterilization
The training is 30 working days
Anganwadi worker
One anganwadi for 1000 people popullation
Under ICDS
Local dais:-

60. 60
Sub-center level:-
it is peripheral outpost of the existing health
delivery systems in rural area
One sub centre …….
Every 3000 population in hilly and tribal ……
Each sub-center one male/female ANM
Primary health center level
In 1946 Bhore community put the concept of
P.H.C.
One P.H.C. for 30,000/25,000

61. 61
Function of P.H.C.
Medical care
MCH including family planning
Safe water supply and basic sanitation
Prevention and control of locally endemic
disease
collection and reporting of vital statistic
Education about health
National health programme as relevant
Referral services
Training of health guides health workers
local dais and health assistants
Basic laboratory services
(tubectomy vasectomy and tracheotomy MTP
and minor surgery)

62. 62
Health care female:-
Registration:-
• Pregnant women
• Married women
• Number of home visits
Care at home:-
•Care of pregnant women
•Advice about nutrition and food hygiene
•Distributes iron & folic acid tab
•Immunization
•Finding gynecological problem
•Family planning

63. 63
•Supervises deliveries
•First Aid in emergency
•Notify disease
•Record and reports of birthdeath
•Test urine albumin
•Distribute conventional contraceptive
Care at clinic
• arrange help to M.O.
•Conduct MCH Family planning clinic at sub centre
Care in the community
•Participant in mahila mandal meeting
•Helping to other staff
other :-
• maintain cleanliness of centre
•Attend staff meeting at P.H.C.
•List the dais of same area
•Co- ordinating

64. 64
Health worker male:-
Record keeping
Malaria (identification, O.P.D. investigation, records, control of
spreading,education,followup)
Communicable disease
Leprosy
Tuberculosis
Environmental sanitation
Expanded programme on immunization
Family planning

65. 65
hospital health centers :-
Community health centers:-
•31st march 2003 established by upgrading the
primary centers
•Covering 80,000 to 1.2 lack population
•30 beds
•Specialist surgery
C.H.C has provided following services :-
Care routine and emergencies cases in
surgery
Care of routine and emergencies in medicine
24 hrs delivery services
Cesareans section
Full range of family planning services,
laparoscopy too.
 safe abortion
New born care
Tracheotomy, nasal pack
National health programme
Other

66. 66
Rural hospital :-
It’s convert the sub division hospital into sub
division health center .
Covering 5 lacks population
 In this covering P.H.C., sub centre, at
tehsil/sub division/ taluka .
P.H.C. patient are shifted for infusion level
District hospital
 it’s convert the district hospital
into district health centre
 hospital differs from health
centre in the following respect
 mostly curative services
No catchment area
Mix team work

67. 67
Specialist hospital :-
The specialist hospital include:-
 trauma centers
Rehabilitation hospital
Seniors (geriatric) care
Psychiatric hospital
Cardiac
Oncology etc.
Hospital may in a single or number of
building on one campus
It may expensive or not expensive too.
Teaching hospital:-
providing clinical education and training to
future
Provide medical education to the doctor, nsg,
health profession
In additional providing patient care.

68. 68
Other agencies :-
Defense medical services:-
 it is largest and almost best organization of
health care systems in the country
Supported facilities:-
1. Ambulance
2. Mobile beds
3. Hospital (all)
4. Staff (doctors,nsg,co-workers)
Health care of railway employee:-
Through out railway hospital care are provide
MCH
School health services
Specialist unique hospital
Primary care
Health check-up

69. 69
Medical officer are working in sub-division centre
The economical sources are providing by railway
department for future care at the low cost.

70. Private agencies:-
In a mixed economy such as India's private practice of medicine
a large share of health services available
The general practitioner constitute 70% of the medical
profession
The component of private agencies are poly Nsg home, general
practitioner
Indigenous systems :-
the practitioner of indigenous systems of
medicine are ayurveda.sidha,homoepathy
90% of ayurvedic physician serve the rural
area
The govt. of India is studying best utilized for
more effective or total health coverage.

71. Voluntary health agencies:-
Definition:-
An organization that is administrated by an autonomous board
which holds meeting collects funds for it supported chief from
private sources and expanded money.
Function :-
Supplementing the work of govt agencies
Pioneering
Education
Demonstration
Guarding work of govt. agencies
Advancing health legislation

72. Health programme in India:-
Since india become free several measure have
been undertaken by the national govt.
Central govt. for control eradication of
communicable disease, improved environmental
sanitation etc.
India given permission to the foreigner countries
to implement them organization in india

73. Factor influencing :-
Demographic trends:-
Population explosion
Declining mortality for both sex
Increasing old age and midline age people
Prevalent of non- communicable disease
Higher morbidity rates
Eliminating communicable disease
social trends:-
 changing of life styles
Appreciation of quality of life
Changing families composition and living pattern
Rising household incomes

74. 74
Economic trends:-
Improved in std of living
Training facilities
Allotment of social welfare funds to other job opportunities
Self employment scheme
Increasing nurses in hospital and non hospital setting
Impaired family planning
political trends :-
policy changes
Supports (economic, attitude)

76. ITS AFFORDABILITY & ACCEPTABILITY HAS TO BE ASSURED FOR
URBAN A/W/A RURAL, WELL TO DO TO THE POORER SECTION OF
THE SOCIETY.
HEALTH IS A HUMAN RIGHT

77. AGENDA
 Healthcare and health insurance in India
• Macroeconomic trends and indices
• Current schemes and coverage
 Global experience and the objectives of health insurance
reform
 Devising an appropriate model for India
• Segmenting the market
• Framework for reform
 Managing the reform process

78. HEALTH CARE SCENARIO
• Before independence - dismal condition.
• High morbidity, mortality and Infectious
diseases.
• After independence - emphasis on PH care.
• Present Problem-
• High mortality, negligible MCH care.
• Urban-Rural divide:70:30.
• Population Size of the country.
• Declining funds to HealthCare Sector-
CG/State.

79. HEALTH CARE SCENARIO……CONTD
 At any given point of time 40 to 50
million of population on medication
for major sickness. About 200 million
days are lost annually.
The annual rate (range) of out-patient:
rural 30-152/1000, urban 9-81/1000
and for hospitalization: rural 16-
76/1000, urban 5-38/1000.

80. •The share of public financing in total health care is just about 1% of GDP
compared to 2.8% in other developing countries.
•Beneficiaries are both poor a/ w/ a well-fed section of society.
•Over 80% of the total health financing is private financing,much of which is
out-of-pocket payments (i.e. User charges) and not any prepayment
schemes.
HEALTH CARE FINANCING IN INDIA

81. 2004 US UK Mexico Brazil China India
Life expectancy
(avg. # of years)
77.4 78.3 72.6 71.4 72.5 64.0
# of Physicians
per 1,000 people
2.7 1.9 1.7 1.2 1.7 0.4
Healthcare spend
(USD per capita)
5,365 3,036 336 236 62 32
Healthcare spend
(% of GDP)
13.2 8.4 5.5 7.5 5.0 5.3
HEALTH CARE SPEND IN INDIA IS CONSIDERABLY
LOWER THAN THAT IN OTHER COUNTRIES

82. THE PROPORTION OF INSURANCE IN HEALTH CARE
FINANCING IN INDIA IS EXTREMELY LOW
0%
100%
Source of finance Means of finance
86% from
out-of-
pocket
expenses
83% from
private
sector
spending
Health care financing in India 2002, %

83. THE WORLD HEALTH ORGANIZATION HAS DEFINED
POSSIBLE APPROACH TO FINANCING OF HEALTH
EXPENDITURE
Total health
expenditure
Public
Private
Social
security
Externally
funded
Tax-
funded
Private
health ins.
Externally
sourced
Out-of-
pocket
Using central / state revenues
for health
Compulsory premium
contributions to health
Channeling loans, grants etc.
to healthcare
Payments to health care providers
for services
Premium contributions towards
health support
Channeling donations etc. to
healthcare

84. SOCIAL SECURITY: CONCEPT
Defined as “the security that
the society furnishes to some
organizations against certain
risks to which the members of
society are exposed”

85. SOCIAL SECURITY: ADVANTAGE
 The financial burden of sickness cannot be borne by
the individual. It must be widely
distributed throughout the country.
 Sickness is not an individual’s misfortune but the
calamity is to taken as community & state
responsibility.

86. HEALTH INSURANCE TYPICALLY HELPS A PATIENT
MANAGE HEALTH CARE COSTS BEYOND A THRESHOLD
AMOUNT THROUGH POOLING
As a contingent
claim
instrument,
health insurance
is an efficient
way to help
individuals
prepare for
health care
Insurer payment
(from premium
pool)
Individual
payment
Deductible Co-
insured
Health care expenditure (INR)
Patient
expenditure
(INR)
Stop-
loss
level

87. WHAT IS HEALTH INSURANCE?
 SYSTEM OF ASSURANCE TO MAKE
CONTINGENCIES OF HEALTH CARE EXPENSES.
 TO PROVIDE PROTECTION AGAINST FINANCIAL
LOSS BY UNFORSEEN SICKNESS.
 TO MEET COST OF GOOD MEDICAL CARE.
 RELIEVES ANXIETY AND TENSION.

88. ORIGIN OF HEALTH INSURANCE:
 International
 1883 Bismarck- sickness benefit to workers.
 1911 Lloyd George- National Health Insurance
Scheme to cover sickness expense, medical
relief, drugs & compensation of wages lost, to
improve quality of life and improve industrial
production.
 J.F.Kimball: prepayment system of health care.

89. ORIGIN OF HEALTH INSURANCE:
National:
 1923: Workman’s compensation Act.
 1948: ESI Act passed.
 1952: First ESI hospital established.
 Mudaliar Committee(1959-1961)
recommendations:
1. Long range health insurance policy for all.
2. Small fee for availing health services.

90. IGIN OF HEALTH INSURANCE…CONTD
 National:
 1999: IRDA act passed.
 2001: Insurance amendment Act:
Emphasis on TPAs.

91. FORMS OF INSURANCE AVAILABLE
 Indemnity Insurance: where the insurer first pay to the
hospital and claim is made. E.g. Jeevan Asha II, Asha
Deep II, Mediclaim.
 Cashless Claim Facility:TPAs who bear the expenses
on behalf of insurance company. Patients need not to
pay directly as a rule e.g. Bajaj Alliance.
 CBHI (Community Based Health Insurance).

92. THE KEY ISSUE RELATED TO FINANCING OF HEALTH
CARE IN INDIA REVOLVES AROUND THE LACK OF
ADEQUATE INSURANCE . . .
 Limited coverage
 Only around 10% of the population is covered
through health financing schemes
 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
 Moral hazard and Adverse selection
 Claims ratios for Mediclaim and Jan Arogya
policies have been in the range of 120 – 130%.

93. THE KEY ISSUE RELATED TO FINANCING OF HEALTH CARE
IN INDIA REVOLVES AROUND THE LACK OF ADEQUATE
INSURANCE … CONTD
System leakages
 Provider malpractices leading to over-
charging or pre-selection / selective
recommendation
Lack of universal schemes
 Limitations in terms of coverage of illnesses
as well as treatment options
 Alternative therapies often not considered /
included under insurance

94. GLOBAL EXPERIENCE PROVIDES SOME KEY
LEARNING ON HEALTH INSURANCE POLICY DESIGN
 Balancing risk-spreading and incentives offered
 Balancing the need to encourage health
insurance against moral hazard (individuals
choose more care) and principal-agent
problems (providers supply more care)
 Integration of insurance and health care provision
 Managing doctor loyalties with patient and
insurer under managed care

95. GLOBAL EXPERIENCE PROVIDES SOME KEY
LEARNING ON HEALTH INSURANCE POLICY
DESIGN . . .CONTD
 Approach to competition and portability
 Balancing the need for consumer choice
against adverse selection (sick preferring
more generous plans)
 Focus on health as against financing of health care
 The over-riding objective should be to
improve health rather than the financing
of health care services

96. SOME KEY CONSIDERATIONS RELATED TO
FORMULATION OF APPROACH TO HI IN INDIA . . .
 Differential approach
-Formal sector (government and non-government
workers)
 Self-employed segment
 Poor / Unemployed segment
 Scope and structure of health insurance cover
 Product and segment coverage
 Portability across service providers
 Cap on premium amounts
 Risk-adjusted approach
 Nature of fiscal incentives
 Subsidies and tax incentives for health insurance as against
health care

97. AS A RESULT, THE TRADITIONAL MODEL FOR HEALTH
INSURANCE NEEDS TO CHANGE...
Individual
Insurer/
Provider
Government /
Employer
Fixed fees
Service charges
Voluntary
premiums
Mandatory
premium
Mandatory
premium
Costs up to
deductible
Could be allied to
insurer or be a
government
approved provider
Inter-
mediaries
TPAs
etc.
Financial flows
Service flows

98. … TO ONE THAT ALLOWS THE FLEXIBILITY TO
SERVE DIFFERENT SEGMENTS OF THE
POPULATION, IN AN EFFICIENT MANNER
• Health insurance providers may need to
align themselves to overall health care
including financing, preventive health
care and health outreach in order to
grow coverage
• Regulations and policy must be
designed to encourage this

99. COMMUNITY-BASED INITIATIVES HAVE BEEN PARTICULARLY COST-
EFFICIENT IN REACHING OUT TO THE POOR / UNEMPLOYED SEGMENTS
Role in Community-based health initiative (CBHI)
Health
intermediary
Health
manager
Health
provider
Example of some
CBHIs / NGOs
SEWA /
ACCORD
Tribhuvandas
Foundation
Sewagram /
VHS
Nature of health risk
covered
Inpatient,
non-health
related
Inpatient Inpatient,
Outpatient
Access to benefits After certain
period
At time of
discharge
At time of
utilization
Administrative costs Moderate Low Low
Nature of pool
formation
Occupation /
geography-
based
Occupation /
geography-
based
Geography-
based

100. HOW CBHI CAN BE MADE REACHABLE
Effort for social mobilization &
strengthening of people organization
Training and capacity building, special
emphasis on PRIs and Women
Organization
Demand Driven social services,
Building of alliances and partnerships
Advocacy for Pro poor policies.

101. MANAGING THE REFORM PROCESS WOULD
REQUIRE SEVERAL INFRASTRUCTURAL AND
MARKET CHANGES TO BE EFFECTED Appropriate market segmentation, awareness initiatives,
product innovation, and incentives
 Easing of entry norms for specialist health insurance
companies
 Provider rating and credentialing
 Centralized database for health insurance experience
statistics
 Efficient back-office support for underwriting and claims
processing

102. Health insurance is an emerging important
financial tool in meeting health care needs
of the people of INDIA. CBHI is to be further
explored so that the disadvantaged section
get maximum benefit.
In India at present no Pan-India Model of HI.
All different forms need to be explored.
CONCLUSION

103. Thank you for patience