Health insurance for India's rural poor
Wednesday, 10 October 2007
Amy Yee
INDIA'S government has launched a plan to offer health, life and disability insurance to some 400m working poor as it tries to deliver on its promise of a "New Deal" for rural India.
P. Chidambaram, India's finance minister, unveiled recently a life and disability insurance scheme a day after revealing guidelines for the aam admi, or common man's, health insurance plan. A pension scheme for people over 65 living below the poverty line is expected to be launched next month.
The efforts are meant to help 10m families, or about 400m people, living below the poverty line and working in India's "unorganised sector". Only about 3.0 per cent of India's workforce is employed by the organised sector, which offers formal jobs with benefits.
The Congress party-led government has pledged to spend $187m (euro131m, £91m) next fiscal year as it implements the programme over five years.
India late last month announced the expansion of a national programme that guarantees rural workers 100 days of work each year. The rural employment scheme has been criticised by some economists as political patronage and a drain on funds.
But the government says the job scheme and other rural programmes are an important part of what Manmohan Singh, the prime minister, has dubbed efforts to provide a US-style "New Deal to rural India" and a social safety net for the country's rural poor.
Employer health coverage reaches only 5.0 per cent of India's population of 1.1bn. Private health insurance accounts for only 0.9 per cent. Less than 15 per cent of Indians have any form of health coverage, according to consultancy KPMG.
A similar health insurance scheme was launched by the previous government but failed owing to lack of awareness and flawed implementation, said Shashwat Sharma, associate director of financial services at KPMG.
Under the new health insurance scheme, India's central government would contribute 75 per cent of an estimated annual premium of Rs750 ($19, euro13, £9) with state governments shouldering the rest. The beneficiary would pay Rs30 a year for a smart card that would access health insurance.
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— FT Syndication Service
INDIA'S government has launched a plan to offer health, life and disability insurance to some 400m working poor as it tries to deliver on its promise of a "New Deal" for rural India.
P. Chidambaram, India's finance minister, unveiled recently a life and disability insurance scheme a day after revealing guidelines for the aam admi, or common man's, health insurance plan. A pension scheme for people over 65 living below the poverty line is expected to be launched next month.
The efforts are meant to help 10m families, or about 400m people, living below the poverty line and working in India's "unorganised sector". Only about 3.0 per cent of India's workforce is employed by the organised sector, which offers formal jobs with benefits.
The Congress party-led government has pledged to spend $187m (euro131m, £91m) next fiscal year as it implements the programme over five years.
India late last month announced the expansion of a national programme that guarantees rural workers 100 days of work each year. The rural employment scheme has been criticised by some economists as political patronage and a drain on funds.
But the government says the job scheme and other rural programmes are an important part of what Manmohan Singh, the prime minister, has dubbed efforts to provide a US-style "New Deal to rural India" and a social safety net for the country's rural poor.
Employer health coverage reaches only 5.0 per cent of India's population of 1.1bn. Private health insurance accounts for only 0.9 per cent. Less than 15 per cent of Indians have any form of health coverage, according to consultancy KPMG.
A similar health insurance scheme was launched by the previous government but failed owing to lack of awareness and flawed implementation, said Shashwat Sharma, associate director of financial services at KPMG.
Under the new health insurance scheme, India's central government would contribute 75 per cent of an estimated annual premium of Rs750 ($19, euro13, £9) with state governments shouldering the rest. The beneficiary would pay Rs30 a year for a smart card that would access health insurance.
............................................
— FT Syndication Service