Other Central InitiativesOther Central InitiativesOther Central InitiativesOther Central InitiativesOther Central Initiatives

The grant is open to resident Indian doctoral students in Economics, Law, or Development who exhibit a strong interest in Law and Economics. It is awarded for doctoral studies in a variety of sub-disciplines such as Law and Economic Development, Economics of Property Law, Competition Law and Regulation, Economics of Tort and Contract Law, Law-Corporate Finance and Corporate Governance, Law and Environment, on the explicit understanding that the subject of the thesis work deals with the broad area of Law and Economics. The grantees are expected to abide by the rules and regulations of their parent as well as the host Institutions.

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Economic and Political Weekly June 24, 2006

It is also visualised that the finances would come from a health cess of 2 per cent levied on various central taxes on the lines of the education cess; this is likely to provide approximately Rs 6,500 crore to the government, which will be spent primarily on schemes meant for the poor. An independent body called the National Public Health Board, which has been specially designated for this purpose will manage the funds. Interestingly, the scheme visualises many heads of expenditure, including subsidy schemes for anti-cancer funds and funding the expanded programme on the anti-retroviral therapy being offered by National AIDS Control Organisation (NACO).

It is also proposed that if there is a problem in levying of a health cess, the government may provide funds amounting to Rs 6,500 crore, which is equivalent to

0.02 per cent of the GDP, out of the general budget.

The IRDA recently passed the Micro-Insurance Regulations 2005 that aim to promote rural insurance. The regulations allow life and general insurers to tie up to offer a combined policy that may cover risks of life, health, crop, huts, livestocks and tools at an affordable cost. The IRDA has allowed insurers to (a) issue policies with cover ranging from Rs 5,000 to a maximum of Rs 50,000 for general and life insurance, and (b) appoint self-help groups, micro-finance institutions and other NGOs to act as micro-insurance agents for the distribution of micro-insurance products under this new regulation. The idea is to make it much easier for different private sector agents – including private insurance companies – to offer insurance products in rural areas, which have hitherto been more or less bypassed by the national schemes.

State Level InitiativesState Level InitiativesState Level InitiativesState Level InitiativesState Level Initiatives

At the state level, experiments are on to promote health insurance either by means of covering state employees or offering coverage to entire/specific populations of the state. The Jammu and Kashmir Government’s Employees Group Mediclaim policy has been discussed elsewhere [Gupta and Trivedi 2005], and is an example of a productive partnership between a state government and an insurance company (National Insurance Company), to offer coverage for employees of the state.

The Assam government, in partnership with ICICI Lombard General Insurance Company, has introduced a combined health insurance and personal accident insurance scheme – ‘Mukhyomantrir Jibon Jyoti Bima Achoni’ – for all those citizens (along with their dependents) of Assam whose names appear on the electoral list, except those whose annual gross income is more than Rs 2 lakh. The scheme covers medical expenses of up to a maximum of Rs 25,000 for the treatment of certain specified diseases, a compensation of up to a maximum of Rs 50,000 in case of death, and reduced amounts in case of permanent disability, under the personal accident scheme.3

Andhra Pradesh is looking into the possibility of such universal coverage as well. A government order numbered 510, dated October 5, 2005 titled ‘Health Insurance – Constitution of Task Force for Study, Design and Submission of Report on a Comprehensive Social Health Insurance Programme for Andhra Pradesh’ mentions the formation of a task force that would map the existing sources of health financing and health resources. After negotiating with relevant stakeholders, it would come up with a pilot project to cover selected districts, which is likely to start from January 2006.

The Kerala cabinet recently approved a health insurance scheme for the poor that is to be implemented with central assistance.4 The scheme is supposed to cover about 25 lakh BPL families for a premium of Rs 99 a year for each family. The beneficiary will have to pay only a third of the premium; the state and local governments will pay the rest. The insurance cover will be for a maximum of Rs 30,000 a year for a member, or up to five members of a family taken together. The scheme also provides for payment of a subsistence allowance at Rs 50 for hospitalisation of the breadwinner. Interestingly, the insured families can avail treatment at government as well as private hospitals. ICICI Lombard is partnering with the government on this scheme, which is yet another good example of public-private partnership as well as partnerships within the government (the scheme involves departments like health, finance and local self-government).

The Rajasthan government initiated a scheme for covering government employees and their dependents, who have joined after January 1, 2004 on a regular recruitment, through Mediclaim, jointly with United India Insurance Company, in August 2004. The premium of Rs 951 plus tax is to be fully borne by the employer, i e, the government.

Additionally, there was also news that the Punjab government has introduced a scheme called Sanjivni Healthcare Scheme for members of rural cooperative societies.5

There may be some or many such schemes that are being jointly implemented by the state governments and insurance companies, which are not in the domain of public information. As is indicated by the references, most of these schemes come to light through newspapers and other public fora. It would be imperative for policy-makers to document and analyse all such local efforts and learn from them. The vibrancy in ideas and new thinking, as well as initiatives in terms of innovations and partnerships are good news as far as health coverage in India is concerned. The fact that a regulatory authority is taking initiatives to form expert groups on rural health insurance,6 instead of taking a back seat and simply regulating, is extremely encouraging.

Piecemeal ApproachPiecemeal ApproachPiecemeal ApproachPiecemeal ApproachPiecemeal Approach

However, there are still causes of serious concern. The major one is the piecemeal approach of the policy-makers towards a problem that essentially needs coordinated thinking. Examples exist of countries7 like South Korea, Mexico, Philippines and Ghana, etc, where the need to offer cover to the entire population has prompted the setting up of an apex body that has the sole responsibility of overseeing health insurance. Instead of different ministries taking initiatives for covering areas/populations that are under their jurisdiction, it is important for planners to understand that ultimately, parallel schemes with public money can only introduce inefficiencies and wastage into the system. Thus, while it is laudable for the ministries of health, labour, textiles, petrochemicals and fertilisers to launch their own schemes, it is the need of the hour for those in charge of planning to create a body that can fold all these initiatives under its wing.

The way forward is to go back to the drawing board, with experts, to chart out for the entire country: (a) who needs to be covered, (b) how they can be covered,

Economic and Political Weekly June 24, 2006 (c) what should be covered, and (d) where they should go to seek services. The discussion could go occupation-wise (formal/informal), or economic statuswise (BPR/non-BPL), or be based on any other classification. The main point is that someone or some group has to do this thinking, and soon. Ultimately, most of the schemes meant for the BPL population or employees of the government, or the informal sector workers, would be based on substantial subsidies that come out of taxpayers’ money. It is important to use this money with care, which can only be done if a consolidated and holistic approach is taken to spread health coverage.

An important point to note is that state governments are taking many of the health insurance initiatives. Even if health insurance is made a central subject, the centre cannot go ahead alone; it will need the states to share both in the finances as well as the implementation of the schemes. The collaboration, cooperation and coordination between the centre and states need to be worked out in detail for any comprehensive countrywide scheme. The social security bill and pharmaceutical policy mentioned above are good examples of central-state collaboration, but it remains to be seen how these unfold. The point being made here is that it is necessary to plan the spread of health insurance on a national scale, so that all the initiatives currently being put in place in a disjointed fashion can actually become part of the same system. It is also important to do this now rather than later, due to the positive wind blowing around health insurance in India.

For all these reasons, it is strongly recommended that planners set up an apex body (say a Health Insurance Corporation of India) that would be in charge of implementing health insurance in India. The exact structure and composition of the body can be worked out by an expert group appointed by the government, which would also chalk out a blueprint of how the country can move towards greater health coverage. IRDA regulations can also be suitably altered so that regulation of health insurance is carried out separately from non-health products. All the existing innovations and schemes might have a place in the new scheme of things, or they may offer valuable insights into what will and will not work. The expert group, and ultimately the new body, will need to also extend public finance considerations to existing schemes like the CGHS, ESIS, railways, etc, which have similar functions, i e, to extend health coverage to select groups of population. As has been proposed before [Ellis et al 2000; Mahal 2000; Guhan (unpublished); Gupta and Trivedi 2005], there is an urgent need to consolidate the existing schemes and bring under the same umbrella new schemes to fulfil the objective of “health for all”, through the mechanism of health coverage for all.

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Email: trivedi.mayur@gmail.com

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