Seminar

On

Micro Insurance

Presented by :

APV Reddy

CEO

Family Health Plan Ltd.

15th Oct 2005

Healthcare Spending

Source: Peter Berman 1996

Govt.

Municipalities

Out of pocket

ESI

External Aid

Other sources

Employers

75.2%

20.7%1.4%

1.2%

0.5%

0.5%

0.8%

Over 75% out of pocket payment..…Indicator of potential for Health Insurance

• 2% of APL Indian fall into BPL every year

due to Health care indebtedness- Express Healthcare Management 2004

• Health care expenditure is the second cause for Rural Indebtedness - NCAER

• 24 % of Hospitalized Indian are pushed into indebtedness due to Healthcare expenditure

- World Bank

Traditional Insurance (Mediclaim) 1%

ESIS & CGHS 3%

Railways 1%

Social /Mandatory Insurance 4%

NGO/CBHI (Self funded) 1%

Around 9% population is covered……

How does the Health Insurance Industry looks today

How does the Health Insurance Industry looks today

• ESIS 253 Lakhs

• CGHS 43

• Railways 80

• Defence Employees 66

• Ex Servicemen 75

• Mining & Plantations 40

• State Sponsored Schemes 5

• Employer Reimbursement schemes 140

• Community Based H S 30

• Health Segment of Life Inc 2

• Health Ins PSU 100

• Health Ins Pvt Cos 30

• TOTAL 864

Market place

Indian Population

70% APL30%BPL

Public Hospitals/Trust

Low cost Hospitals

50% lowerMiddle class

40% UpperMiddle class

10% Elite class

Moderate cost,high tech

High cost,high tech, Frills

Economic levels are major drivers in the Health care industry

Rural -73 %

Urban -27 %

So far…… emphasis of organized health

insurance

has been in Urban areas for multiple reasons

Indian Population – Rural Vs Urban

URBAN

270 mn

Above Poverty Line

COVERED

Above Poverty Line

UNCOVERED

Source: Census India

90 mn lives

90 mn lives

MediclaimCGHSESISPSUsState Govt.Defense

BPL

UNCOVERED

90 mn lives

Self EmployedEmployed but not covered

Urban Poor

Urban India- Segmentation

RURAL

730 mn

Above Poverty line

530 mn

Below Poverty Line

200 mn

Organized

360 mn

Unorganized

170 mn

Unorganized

70 mn

Organized

130 mn

Source: Census India

60% ( 430 mn)

Farmers

Rural India - Segmentation

Innovative Product

•Community based products

•Social Insurance

•Coverage for Out-patient

•Integration of Inpatient & Out-patient

What India needs for a achieving a significant Health Insurance coverage

Photo ID Card

Cashless Network

Claims Management

Call Centre

Medical Pre-authorization

TPA

MIS

What India needs for a achieving a significant Health Insurance coverage

Healthcare Spectrum

Preventive care

In-patient care

Out-patient care

Medical

Surgical

All the existing Models cater to the In-patient requirement only

VaccinationCheck-upsHeath camps

Consultation

Pharmacy

Investigations

Suggested Plan

Surgical treatmentRelevant Medical treatment

•Govt has to play a role in social & preventive medicine

•Govt. hospitals capable of handling medical treatment

•Surgical treatments are expensive

•Lack of surgeons in Rural Hospitals

Hence Health Insurance cover for……

Medical Surgical

Number of cases

58% 42%

Expenditure 23% 77%

Co-operative SocietiesBanks/ NABARDCo-operative Banks

Suggested medium

30% rural Indians avail Banking services ( 41.6 million families)

Almost 100 % villages are covered under co-operative fold

67% of rural household are members of Co-operative institutions

7% of the Farmers have Kisan credit card

Over 35,000 branches of 560 banks located in 563 districts in 30

states

Source:NABARD.microfinance.2004

Provider of healthcare services

Govt. Hospitals

Private Hospitals

Nursing Homes

Network of hospitals - both private and government - across the country to facilitate delivery of treatment to the

rural poor at their door step……

Public Private partnership

1600Surgical procedures

Free Outpatient Consultation

Largely Discounted Lab Tests

100 % Cashless treatment

In Top Quality Hospitals

Standard rates at Private Hospitals

Easy AccessUser friendly

Yeshasvini - Features

Registered member of State Co-operative society for minimum 6 months

Dependant family members

Age limit- Upto 80 yrs

Membership for

Product features

Cost of Medicines & consumables during hospital stay

Cost of Operation Theater ,Anaesthesia, Surgeons fee

Professional charge: Consultant fee, Nursing fee

Accommodation

Entities involved

Network Hospitals

FHPL

ImplementAdminister

Govt. ofKarnataka

Dept. of Co-operative

Implementation of the Scheme

Trust

Family Health Plan Ltd(FHPL)

Governing Body

Fund maintenance & Disbursement

Periodic review

Administration

Claim processing

Services to member

Reporting – MIS

Periodic review

Dept of Co-opMember identification

Membership protocol- collection of Fee

Feed Back

Provider of healthcare services

Network hospitals

Cashless treatment

Special discounted tariff for medical treatment

Preferential treatment

Free Out-patient consultation

Discounted Lab charges

Exclusive front desk counter

2003-2004: -114 Hospitals

2004-2005:- 137 Hospitals

Hospitals spread across 30 Location

All hospitals follow single rate list for defined surgical procedure

STATISTICSYeshasvini Co-operative Farmers Health Care Trust

Jun 03 - May 04 Jun 04 - May 05 Total for 2 years

Numbers Value Rs. Numbers Value Rs. NO’s Value Rs.

No of Mems Enrolled 1,601,152 2,021,661

Contribution collected 96,909,491

119,755,440

Govt Contribution 45,000,000 35,788,000

Interest 3,743,622 4,880,368

Cont frm CO OP soc 6,296,177

Contrbution from SBM 300,000

Total Amt Collected 145,653,113

167,019,985 312,673,098

Claim Status

Claims Settled 8,996 105,385,417 13,632

162,317,166

Bills Pend for pyment 12 97,000 1,232

16,971,6

03

Total 9,008 105,482,417 14,864

179,288,769 23,872

284,771,186

0.56 0.74

Free OPD Treatment 35,814

50,171

85,985

Facts & Figures Year 1 Year 2 Year 3 ( 4 months)

Sensitization 6 months

News paper/ TV/ Radio Jingles

2 months

News paper/ TV/ Radio Jingles

2 months

News paper/ TV/ Radio Jingles

Enrollment drive 6 months 2 months 4 months

ID cards Not issued Partly issued Partly issued

Number of hospitals 114 137

Group size 16 lakh 21 lakh 14 lakh

Membership fee

Govt

Rs.60/- PA ( 9.6Cr)

Rs.30/- PA (4.5 Cr)

Rs.60/- (11.9 Cr)

(Total 4.56 Cr)Rs.3.45 Cr Govt. +48 L (interest) + 62.9L( Co-op) +3L ( SBM)

Rs.120/- (16.9 Cr)

Nil

Total Corpus Rs.14.19 Cr Rs.16.5 Cr 16.9 Cr

Renewal rate Not applicable 35% 43%

Claims settled 9008 14864 1937 ( Pre-auth)

Total claim payout Rs.10.53 Cr 17.9 Cr 3.39 Cr( Pre-auth value)

Avg Claim value 11689/- 12042/-

Incidence 0.56% 0.74%

Free OPD 35814 50171 9356

•Strong Govt. initiative & support

•Large identifiable groups

•Defined & extensive network of hospitals

•Largely discounted rates at Private hospitals

•Effective administration by TPA

Success factor

Thank you