Health insurance and health care in India: a supply-demand perspective

Perianayagam, Arokiasamy and Goli, Srinivas (2013): Health insurance and health care in India: a supply-demand perspective.

Abstract

India’s health care and health financing provision is characterized by too little Government spending on health, meager health insurance coverage, declining public health care use contrasted by highest levels of private out-of-pocket health spending in the world. To understand the interconnectedness of these disturbing outcomes, this paper envisions a theoretical framework of health insurance and health care revisits the existing health insurance schemes and assesses the health insurance cover in relation to the pattern of health care use using data from myriad official statistics and the recent NFHS, 2005-06. Theoretical exploration of the axis of supply-demand determinants unfolds that a complex of factors such as sparse health financing options, self-obstructing heavily risk protected insurance market and weak consumer demand contribute to the measly level of health insurance penetration in India. Health insurance cover is found to be a strong determinant of modern health care use. Regional and rural-urban disparities in health insurance and health care are significant. Health insurance coverage is positively related while public health care use is negatively related with household economic condition and education status. The complex axis of critical supply side imperfections and considerable demand side weaknesses necessitate a major health care reform with the viable financing and health care options.

• Item Type: MPRA Paper
• Language: English
• Keywords: Health insurance, health care, supply-demand perspective, India
• Subjects: I - Health, Education, and Welfare > I1 - Health > I11 - Analysis of Health Care Markets; I - Health, Education, and Welfare > I1 - Health > I13 - Health Insurance, Public and Private; I - Health, Education, and Welfare > I1 - Health > I14 - Health and Inequality; I - Health, Education, and Welfare > I1 - Health > I18 - Government Policy ; Regulation ; Public Health

References

Ahuja, R. (2004), ‘Health insurance for the poor’, Economic and Political Weekly 34(28): 3171-3178.

Berman, P. (1998), ‘Rethinking health care systems: private health care provision in India’, World Development 26(8): 1463-1479.

Deepa, S. and K. Vinish (2004), ‘Health system performance in rural India: efficiency estimates across states’, Economic and Political Weekly 39(13): 1427-33.

Devadasan, N., K. Ranson, W.V. Damme, A. Acharya and B. Criel (2006), ‘The landscape of community health insurance in India: an overview based on 10 case studies’, Health Policy 78: 224–234.

Economic Research Foundation (2006), Government health expenditure in India: a benchmark study. MacArthur Foundation Undertaken for the India, New Delhi.

Ellis, R., M. Alam and I. Gupta (2000), ‘Health Insurance in India: prognosis & prospectus’, Economic & Political Weekly 22: 207-216.

Federation of Indian Chambers of Commerce and Industry (2009), FICCI Health Insurance Conference Report. New Delhi, India.

Ferreiro, A. (2000), ‘Private health insurance in India: Would its implementation affect the poor?’ Private health insurance and public health goals in India. Report on a national seminar, the World Bank.

Government of India (2002), ‘National Health Policy-2002’, Ministry of Health and Family Welfare, Government of India.

Government of India (2005),’ Financing and Delivery of Health Care Services in India. National Commission on Macroeconomics and Health’, Ministry of Health and family Welfare, Government of India.

Government of India (2011), ‘Health Insurance Data report, 2010-2011 of Information Bureau of India’, New Delhi, India.

Ghosh, S. (2011), ‘Catastrophic payments and impoverishment due to our-of-pocket health spending’, Economic and Political Weekly 46(40): 63-73.

Gumber, A. and V. Kulkarni (2000), ‘Health insurance for the informal sector: case study of Gujarat’, Economic and Political Weekly 35(40): 3607-3613.

Gumber, A. (2001), ‘Hedging the health of the poor: the community financing in India’, Health, Nutrition and Population discussion paper, the World Bank.

International Institute for Population Sciences and Macro Internationals (2005-06), National Family Health Survey NFHS 3) Data. Ministry of Health and Family Welfare, Government of India.

Insurance Information Bureau (2010-2011), Health Insurance Data Report. India.

IRDA (1999), Insurance Regulatory and Development Authority(Obligations of Insurers to rural social sectors)Regulations. IRDA, notification dated July 14, New Delhi.

Kutzin, J. (2001), ‘A descriptive framework for country level analysis of health care financing arrangements’, Health Policy 56: 171-204.

Mavlankar, D. and R. Bhat (2000), ‘Health insurance in India: Opportunities, challenges and concern’, Working Paper, Indian Institute of Management (IIM), Ahmadabad.

Mahal, A. (2002), ‘Assessing private health insurance in India: political impact and regulatory issue’, Economic and Political Weekly 5: 59-71.

Mills, A. (2000), ‘Health Insurance: implications for the demand and supply of health services’, Paper presented at two day conference on Health Insurance in India, Indian Institute of Management, Ahmadabad, India.

Naylor, C. D., P. Jha, J. Woods, and A. Shariff (1999), A fine balance: some options for private and public health care in urban India. Washington DC: World Bank.

Peters, D. H., A. S. Yazbeck, R. R. Sharma, G. N. V. Ramana, L. H. Pritchett and A. Wagstaff (2002), Better Health Systems for India’s Poor: Findings, Analysis, and Options. Washington DC: World Bank.

Rangacharya, N. ( 2001), ‘The concept of health insurance’, Health and Population—Perspectives and Issues 24(2): 73-79.

Rao, S. (2004), ‘Health insurance, concepts issues and challenges’, Economic and Political Weekly 39(34): 3835-3844.

Ranson, K. and M. Jowett (2003), ‘Developing health insurance in India’, Background paper prepared for Government of India workshop on Health Insurance, New Delhi.

Reddy, K.S., S. Selvaraj, D. K. Rao, M. Chouksi and P. Kumar (2011), A critical assessment of the existing health insurance models in India. A research study submitted by Public Health Foundation of India, sponsored under the scheme of socio-economic research, New Delhi, The Planning Commission of India.

Srinivasan, R. (2001), ‘Health Insurance in India’, Health and Population—Perspectives and Issues 24(2): 65-72.

Wagstaff, A., M. Lindelow, G. Junc, X. Ling and Q. Juncheng (2009), ‘Extending health insurance to the rural population: an impact evaluation of China’s new cooperative 102 medical schemes’, Journal of Health Economics 28: 1–9.

World Bank (2002), Better health systems for India’s poor—analysis, findings and options, Washington DC.

World Health Report (2003), Shaping the future, Geneva: WHO.