The 4th annual CII Health Insurance Summit, a 2 day event, was launched by Planning Commission Chairman, Montek Singh Aluwalia and IRDA Chairman, J. Hari Narayan in Delhi. With over 500 delegates it is the largest health insurance event in India and the focus this year is “Collaborating to build a foundation for growth and sustainability”. The summit happens at a time of significant developments in the health insurance industry.
Addressing the Summit, Montek Singh said that Government is planning to increase its expenditure on Healthcare to 2-3% of GDP with some serious policy initiatives in pipeline. Deputy Chairman, Mr Montek Singh has requested CII to advice on channelising public schemes like CGHS & ECHS through Insurance. He felt that there could be expansion of Group Health Insurance by allowing tax deductions in wage expenses to only those corporate providing health insurance to their employees. CII has also been asked to share international experiences from the countries who have adapted such a system to promote Health Insurance.
Chairman IRDA, J Hari Narayan assured that the issues of the stakeholders will be resolved and felt regulatory concerns for Health Insurers who have been in financial stress past few years. He acknowledged that the Private Health Insurers are financially solvent and that a proper reporting system to improve underwriting practice is urgently needed. He highlighted that in India the penetration of Health Insurance is low and the government should seriously consider increasing their spending on healthcare. Harinarayan also briefed upon the Insurance Portability and desired that more and more organizations to come forward with this system.
A Vaidheesh, Summit Chairman, shared the recommendations of the CII Working groups on Health Insurance and mentioned that there has been an adverse ratio in India due to sick people taking health insurance largely. Amongst the invited dignitaries Dr Prathap C Reddy , Dr Naresh Trehan, Mr Analjit Singh & Bhargav Dasgupta shared their views on Health Insurance.
While health insurance is growing twenty five percent per annum and is poised to touch the landmark of Rs. 10,000 crore in annual premium soon, it is an industry struggling to be profitable while trying to grapple with growth. For most general insurers, health insurance is now the second largest line of business, accounting for more than 20% of revenue and there are 3 standalone health insurers with a fourth expected soon. Although all the business segments, retail, group and social are growing; most insurers loose money on the group portfolio due to aggressive competition amongst the insurers. The summit will focus on addressing this loss making portfolio by discussing methods of scientific pricing of group covers. Methods of increasing penetration of retail products, especially beyond the large cities will also be discussed. The speakers include many healthcare providers; in a special session on Friday, Sept. 10th they will jointly discuss options for overcoming the current deadlock on package pricing.
The Summit also attracts international attendees who have come to find out how to replicated mass schemes for BPL segments in their country. A lot of attention is being paid to RSBY and Arogyashee, who are adding millions of the nations poorest every year to the list of those covered. Currently about 200 million people in India have health or medical benefits under schemes for government employees, railways, armed forces personnel and through ESIS, RSBY and Arogyashree as well as private health insurance.
The total may well double to 400 million by 2015, making India potentially the largest health insurance market worldwide by number of lives insured. The industry feels that the time is right for the government to define the role of health insurance in a unified national health policy.
As the industry matures, it realizes that systematic capacity building and policy formulation are the imperative issues to be addressed. The 4th CII Health Insurance summit has released a report developed by the CII Working Groups on Health Insurance. This report disseminates best practices and outlines mechanisms to increase innovations in products and client services including innovations that can help hospitals and insurers deliver better choices and services to the consumers.
It also provides the outline of a comprehensive communication and awareness exercise which the industry is planning on undertaking. Such initiatives will help all the stakeholders to prepare for significant growth and will ensure that the growth is sustainable and inclusive.