Need to step up public and private sources of healthcare funding
High reliance on out-of-pocket spending on healthcare in India poses serious health policy challenges related to financial risk protection in future years. To avoid this, India needs to focus on the potential ways to pool this risk through insurance and reduce out of pocket expenditure, for which there is a need to step up public and private sources of healthcare funding. These were some of the findings from a KPMG-CII report titled- “Health Insurance Inc.: The Road Ahead.”
Speaking at CII’s Health Insurance Summit 2008, Neville M. Dumasia, Executive Director & Head Governance, Risk and Compliance Services, KPMG in India said, “If India wants to achieve a more desirable proportion of out-of-pocket expenditure, as in China (60%), it would entail increased participation from public, private or a combination of these sectors, with private health insurance playing a significant role.”
The private health insurance industry has been growing at a growth rate of 37% since FY 2002 and currently stands at INR 5,125 crores (FY 2008). Several factors such as the changing socioeconomic and demographic environment of India, favorable regulatory environment as well as significant marketing push by insurance companies have driven the high growth rate of the industry.
There are several challenges that participants in the health insurance value chain face, which could hinder this growth. Foremost among these challenges are low awareness about health insurance, lack of standardization of healthcare providers and the lack of data that can empower informed decisions.
Similar to the key participants of the health insurance value chain, Indian consumers have their own challenges. To get a better understanding of these challenges, KPMG commissioned a consumer study across socio-economic classes A, B and C in metros, Tier I and Tier II cities. The report summarizes the key findings of the consumer study. It was found that while most customers agree with the concept and necessity of health insurance, they have limited understanding of the features of health insurance products and are skeptical about tedious claims processing procedures, limited options of hospitals/doctors and limited product offerings by insurance companies.
Ravi Trivedy, Executive Director, Business Advisory Services, KPMG in India said, “We are at the threshold of an unprecedented growth for the next 5 to 7 years in the industry. However, if we wish to make this face lift in the industry, it is imperative for all the stakeholders to come together to drive a few key initiatives that will form the buildings blocks and take the industry in the desired direction“.
KPMG in its report emphasizes that the “Pillars of Change” - increasing consumer awareness, standardization and accreditation of healthcare providers, enhancing healthcare infrastructure and building of a health insurance repository are critical to building a robust health insurance industry. However, these pillars need to be supported by the “Enablers for Growth” – Technology, innovation around products, pricing and channels – in order to propel the growth of the industry in the future. The report also talks about the key action steps that the various stakeholders need to take towards achieving this.
“KPMG believes that achieving this growth will depend on the ability of the key stakeholders viz. Government, Regulator, healthcare providers, insurance companies, NGOs/ SHGs/ MFIs, TPAs, distribution channel partners, health centres and the media to strengthen the industry around the “Pillars of Change” and “Enablers for Growth “, said Ravi.
Source: IndiaPRwire
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written by Rajkiran, May 22, 2009
written by automatic forex trading systems, March 27, 2009
Great stuff as usual....
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