The aadhaar of mass health insurance

ALOK AGARWAL | Updated on April 22, 2013

The reach of Rashtriya Swasthya Bima Yojana has improved with use of biometric cards.

Technology has improved the poor's access to healthcare.

India grapples with the issue of a major divide between the well-to-do and the lower end of the population strata. The challenge of uplifting the ‘below the poverty line’ section of the population remains a challenging task. One of the areas which ranks high on this priority list is access to healthcare facilities.

As is well known, events related to emergency health treatment can lead to a significant dent in financial security of any family. This is all the more relevant in the case of our country, given that Indians need to predominantly rely on out-of-pocket spending when it comes to expenses on healthcare. An average citizen has to meet 61 per cent of the expenses from self-generated resources.


Amid this scenario, the country faces a dual challenge in the area of healthcare. On the one hand, the current healthcare infrastructure needs to be drastically improved. As per the WHO report (2010), India has only 1.3 beds per 1,000 population, which is far below WHO guideline of 3.5 beds per 1000.

If one were to collate these statistics for the rural areas specifically, the numbers would look even more dismal, given that a majority of the healthcare infrastructure is concentrated in the urban areas.

To address the problem of access to healthcare for the masses, the Government is looking at increasing healthcare budget allocation from 1 per cent to 2.5 per cent of the GDP.

While increasing spends is a critical requirement, there are larger hurdles to be overcome, including health insurance enrolment, beneficiary identification, claims processing, hospital reimbursement, among other things.


As we attempt to find solutions to address these issues, we should take inputs from some recent examples, wherein institutions have been able to reach out to the lower end through prudent use of technology.

A healthcare-focused foundation in Hyderabad is piloting a rural health delivery and micro insurance scheme that focuses on provision of outpatient care in the village setting.

Trained community members designated as Village Health Champions (VHC) are equipped with hand-held terminals, with built-in clinical decision systems to provide appropriate medical advice to villagers at their doorstep. In another example, a private hospital is rolling out a telemedicine initiative in some villages, making available specialists in the entire domain of healthcare to anyone, at anytime and from anywhere.

Within the insurance industry, one can look at the success of Rashtriya Swasthya Bima Yojana (RSBY). It has been able to reach out to a large base of BPL families, given the prudent use of technology through biometric cards. This system helps identify beneficiaries, thereby ensuring the benefits reach the intended recipients.

A large number of schemes in India were not successful earlier, as beneficiaries were not clearly identified, given that there was no foolproof method of identification. RSBY with its adoption of cost-effective technological tools has been able to provide a clear roadmap for other initiatives planned in this domain.

Catering to the challenge of most target families migrating from one place to another, the system addresses the issue of availability at different places through inter-operability agreements between participating insurance companies.

The biometric card system has, in fact, helped the industry overcome the hurdle of cashless transactions for availing treatment at eligible hospitals.

The system enables the beneficiary to avail of cashless treatment irrespective of the location and the hospital, with the hospital reimbursement happening in the least possible time aided by real-time data flow. As on date, RSBY has covered 34 million BPL households.

With the recent announcements in the Budget to include segments such as rickshaw pullers, mine workers, taxi drivers, and so on, it will help a larger base of citizens in the lower strata to gain access to such schemes. As on date, RSBY has witnessed over five million operations across the country on an entirely cashless platform.

The above examples clearly present a strong case for adoption of technology in our attempt to provide access to affordable and quality healthcare for India’s underprivileged.

Apart from empowering the deserving to access basic facilities, it will also be able to improve overall efficiencies in the healthcare ecosystem covering providers, that is, hospitals, patients, and the payer (the Government).

This is possible only because of the seamless integration between multiple entities achieved through innovative use of technology.

(The author is Executive Director, ICICI Lombard General Insurance Company.)

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Published on April 22, 2013
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