Health care insurance or Medi claim, as it is popularly known in India is a comparatively new, and at the same time, fast-developing insurance segment. Until the time the industry was opened up for private participation the concept of healthcare insurance was alien to a major segment of then insurable population of India. Until the time the nationalized non-life insurance sector, represented by the General insurance corporation of India and its four subsidiaries were transacting health care insurance under a single brand Mediclaim, Mediclaim was a ‘ Reimbursement Plan. wherein the insured was entitled for the reimbursement of hospitalization charge as per the terms of the contract.
the concept of ‘ Cash Plan” under which the contract provides for the payments of a predetermined amount per day of hospitalization irrespective of the actual expenditure, was popularized by the private insurance companies once they started marketing healthcare products. For want of proper promotions and creation of awareness by the public sector companies the health insurance sector had almost stagnated. After the advent of the private players, the sector companies, the health insurance sector had almost stagnated. After the advent of the private players the sector became more vibrant . During the decade 1992-2002, the premium income had grown phenomenally
. During this period , the sector had grown at an average rate of 125% per year. the premium from a more Rs. 35 Crores in 1980s had touched Rs. 477 Crores as at the end of the fiscal 2002, and had more than doubled during the fiscal 2002-03. According to estimates, the healthcare premium is expected to be around is Rs. 1,753 crores by the year 2005. To harness the huge unexplored segment of the health sector, many studies have been conduct . the principles among the them are the CII-McKinsey Report and the Report on Health insurance by the committee constituted by the Ministry of Health and family welfare. There are many areas where the reports show agreements. the following are the areas that are common to both reports. To attract proper and qualified insurers, the Government should take necessary initiative to stimulate the growth of private , social and community sector insurance .
Multi -tiered insurers with better understanding of the regional requirements should be encouraged to set up shop. Health insurance is to be recognized as a separate line of insurance . The entry level of Rs. 100 crores and the solvency norms are discouraging because stringent norms make it difficult to break-even within a reasonable time. Reduction in the entry norms will improve stability of the business. A view is emerging that the capital adequacy should be have a relationship to the type of business of the insurer and the nature of operations. The IRDA should develop separate regulations for the health score and make registration with the IRDA mandatory for all health care providers , including NGO’S All private employees should be mandated to provide health care insurance .
The government should provide guidelines for social insurance and set up pilot projects to monitor existing schemes. there should be health care insurance products to meet the needs of various segments of society. Developing proper underwriting standards, effective, management of hospitals, effective management of claims and offering diseases specific covers for cost containment are necessary. Presently the health care business is not attractive because health care providers are not able to achieve even the viable margin of 3% for the loss Ratio is more than 120%. To streamline health care insurance in India , a working group has been constituted under the aegis of the USAID (United States Agency) for International Development) to assist to IRDA in developing future policies on health care insurance . This committee is studying a wide range of references.