Mandatory health insurance, insurance coverage for elderly, priority sector status, creation of health infrastructure and innovation funds, promotion of medical tourism, CSR incentives along with other tax related reliefs and exemptions prominently figures in the pre-budget recommendations submitted to the government by Healthcare Federation of India (NatHealth).
To ensure universal healthcare access and augment healthcare and infrastructure capacity, NatHealth has emphasised on introduction of mandatory health insurance. Currently, only around 4% of the population in the country have health insurance coverage. Out of pocket healthcare spending constitutes 86% of total healthcare spends in India. Further, a vast majority of the rural poor are unable to access quality healthcare.
“The major reason for the low penetration of health insurance is that it is currently optional. It is also the case that most of the people opting for health insurance have some pre-existing illnesses. This has led to a high claims ratio being prevalent in the health insurance business which makes it difficult for health insurers to sustain their operations,” said Dr. Arvind Lal, President, NatHealth.
While appreciating the government’s efforts to introduce a health insurance scheme for economically weaker sections of the society and senior citizens in the last budget, NatHealth recommended that the government could also explore making health insurance coverage mandatory for all citizens in a phased manner, initially covering the organised sector.
“Apart from enabling universal access to healthcare, this move would also meet the urgent need for augmenting healthcare capacity creation in the country,” Dr Lal added.
NatHealth also recommended increase in quantum of deduction towards payment of medical insurance premium as it considers the present annual deduction limit of Rs.15,000 inadequate to push health insurance schemes. Accordingly, it should be enhanced to Rs.50,000 for self and family and the current annual limit of Rs 20,000 in respect of dependent parents needs to be enhanced to Rs.50,000.
The Federation also emphasised that there is an urgent need for setting up a Health Infrastructure Fund and A Medical Innovation Fund.
“The government can think of providing the seed capital for funds such as Health Infrastructure Fund and Medical Innovation Fund. Access to funding by creating a specific fund for healthcare infrastructure and innovation would facilitate access to capital for the sector,” said Anjan Bose, secretary general, NatHealth.
“These funds would encourage entrepreneurship and newer business models which are the need of the hour for improving access, availability and quality, especially in tier 2, tier 3 and rural areas,” Bose added.
NatHealth also recommends that healthcare should be given priority sector status. Though healthcare was included in the harmonized master list of infrastructure sub sectors by the Reserve Bank of India in 2012, long term financing options are still not available for healthcare providers.
According to NatHealth, “Priority Sector” status to healthcare will help in the process of enabling development of innovative long term financing structures for healthcare providers apart from creating an attractive environment for domestic production of medical equipment, devices and consumables while also catalysing research and development. NatHealth feels that this will channelize funds from the banking sector to create necessary healthcare infrastructure and meet societal objectives of the government of India.
In order to make India a preferred healthcare tourism destination by ensuring a level playing field with other Asian healthcare nations, and earn valuable foreign exchange, NatHealth also suggested that earnings from medical tourism should be made fully exempt from income tax for healthcare providers.
Nathealth, health insurance
