Compulsory insurance!

The poor condition of India’s healthcare was blatantly exposed on July 26, 2010 when a poor woman gave birth to a baby girl on a footpath of Delhi's sprawling Connaught Place. But the brutality of the situation was further exposed when she died four days later due to lack of basic healthcare needs that a woman requires after giving birth to a child. There are innumerable such cases that go unnoticed everyday. Ironically, it happens amidst our policy makers, busy forming policies on how to establish India among the first league of nations.

Globally, healthcare expenditure has increased from 3 per cent of world GDP in 1948 to 7.9 per cent in 1997. As of 2006, India spends 4.9 per cent of GDP on health care with $36 per capita expenditure annually. Surprisingly, the Government bears only about 21 per cent of that and the rest is taken care by the private concerns. More surprisingly, in 94 per cent of the cases, healthcare expenditure is met out-of-pocket.

India has managed to develop a large public health infrastructure with over 150 medical colleges, 450 district hospitals, 3000 community health centers, 20,000 primary and 130,000 sub centers in addition to a large number of private and NGO health facilities across the country.

Clearly, even this is quite inadequate. A holistic approach is required to catapult the entire healthcare system and compulsory health insurance – aka compulsory car insurance – seems to be the need of the hour in the present context. Interestingly, compulsory health insurance has good precedence.

France, Holland, Switzerland, Saudi Arabia and Abu Dhabi have introduced compulsory insurance not only for their citizens but also for the expat communities. Australia has given massive tax breaks for people privately insured and this has led to 40% Australians buying insurance. Qatar, Kuwait, Dubai are also considering compulsory health insurance seriously. And of course, Barack Obama's healthcare reforms have ensured that every company in the United States now has to compulsorily provide proper healthcare insurance to all its employees; and that unemployed people will get healthcare insurance from the government.

In case India moves forward in this, cases like Vietnam could also be lessons for India. Vietnam had introduced mandatory health insurance decades ago, but still, half of the population is still uninsured, purely because of ineffective implementation of policy. If India were to make health insurance mandatory (and universally free for those who cannot afford the same), that may still not resolve the situation, as regionally, there would still remain a huge dearth of hospital beds and doctors for those in need.