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  1. Shailender Kumar
  1. Institute for Studies in Industrial Development (ISID), New Delhi, India


Background Promoting healthcare access and reducing out-of-pocket (OOP) expenditure is an important health policy goal in a developing country including India. How far health insurance interventions have helped in achieving these objectives is examined in the present study.

Objectives This paper examines the impact of health insurance in promoting access to healthcare use and providing financial risk protection during health emergency. This also evaluates the relative role of publically financed pro-poor health insurance-PFPHI (like, the Rashtriya Swasthya Bima Yojana-RSBY and state run health insurance scheme) schemes, employer insurers and private insurance companies in providing financial protection to meet health expenses.

Methods This study has explored data at the household?s level from two National Sample Survey (60th: 2004–05 and 68th: 2011–12) rounds, provided by Government of India. The two-sample t-test, concentration curve and multivatiate regression analysis is used.

Result We found that health insurance promotes access to healthcare use for inpatient cares and promote equity. The impact of health insurance in promoting healthcare use remained noticeable high among poorest, as the inpatient rates of poor insured persons found about 16.4% higher than poor uninsured persons. However, it appears that health insurance encourages people to switch to costlier/tertiary cares and sidetracking primary care providers and leading to demand-supply induce moral hazard problems. This in turn increases the cost per inpatient episode of care. Health insurances financial protection remained highly biased towards rich and urban, while limited to poor and rural residents. The publically financed pro-poor health insurance strategies turned effective in promoting healthcare access/use, in area where provider networks are fairly extensive spreading across regions, in failure, their likely impacts found to be low. The role of private insurers (with the increase in FDI caps in health insurance from 26% to 29%) however expected to grow in India but financial protection provided by them are found one of the lowest. The average amount of premium collected by them is one of the highest but reimbursement made is very low.

Conclusion Findings suggest India needs to adopt both health insurance and tax-financing strategies with appropriate regulation of private providers and insurers markets.


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