FINANCIAL PROTECTION IN HEALTH INSURANCE SCHEMES: A COMPARATIVE ANALYSIS OF MEDICLAIM POLICY AND CHAT SCHEME IN INDIA

Household out-of-pocket spending for health care occupies 90 per cent of private health expenditure in the year of 2007 in India. This alone may push 2.2 per cent of the population below poverty line each year; 24 per cent of the people fall below the poverty line because they are hospitalized; 28 per cent in rural and 24 per cent in urban areas of those who had illnesses, have cited financial constraint as the reason for not having used health care. Further, there is a growing preference for private health care where more than 80 per cent of the people prefer to utilize private sector health care facilities. Despite massive and enormous efforts to scale up health insurance as a mechanism to reduce financial burden due to health care, the health insurance penetration is still very low in India. Let us look at one fundamental question is this regard, which is the main focus of this study: Do prevailing health insurance schemes offer necessary financial protection during illness? To the knowledge of this author, there has been no study till date that has examined whether prevailing health insurance schemes in India meet the preferences of clients and hence offer necessary financial protection during illness. The present study has examined the above question by analyzing the level of financial protection to low income people during illness in ‘private health insurance’ and ‘people's preferred health insurance’, by exploring the effective financial protection (reimbursement) of the pro-poor version of the Mediclaim policy in comparison to the ‘CHAT scheme’.