Government of Chhattisgarh has recently announced increase in coverage under RSBY/MSBY from Rs30,000 to Rs50,000 per family per annum. This is a welcome step as many more diseases can now be treated under the scheme.
However some other proposed changes in the scheme are worrisome. One proposal is to limit treatment of some surgical conditions like Hydrocele and piles to Government Hospitals. Another proposal is to allow co-payments by patients for upgrade to private ward facilities etc. Both these proposals do not appear to be well thought out and are likely to be counterproductive.
RSBY launched mainly with the objective of avoiding out of pocket expenditure for health care by poor patients. There was also the added advantage that, under this scheme, consumers have a choice of health care providers.
It is well known that financing of health care through out of pocket expenditure can be impoverishing even for middle income families. It can be catastrophic for the poor. Two different models have been followed in the World to avoid out of packet expenditure in health care. The first model is to provide free health care in Government run hospitals to everybody.
This is the model followed by the UK under NHS. India has also largely followed this model albeit rather ineffectively. Government hospitals in our country are short of doctors and paramedical staff and in most cases are able to provide only basic health care. For this reason while in theory free medical care is available to everyone in Government Hospitals, in practice most people are forced to seek health care from the private sector at a huge cost.
The second mechanism for avoiding out of pocket expenditure in health care is prepayment and risk pooling through medical insurance schemes. This is the model followed in most of thedeveloped World including the USA and Australia. Many European countries have realized that poor people may not be able to pay the premium required for adequate coverage under healthinsurance schemes and have therefore come with solutions like the employers being mandated to pay part of the premium and cross subsidisation of premium under social security schemes.
The first big health insurance scheme in India in Government sector is the ESIS. Other big scheme being run for some time by the Government is the CGHS. Many private sector insurance companies have in the meantime launched new products which provide adequate coverage. The premium under these policies is quite large in most cases. The poor therefore cannot afford these insurance policies. Government responded to this by launching RSBY which provides a limited coverage to the poor and the premium under the scheme is paid by the Government.
RSBY is successful because under the scheme insurance companies are allowed to purchase health care services both from the private sector. The new proposal of limiting certain surgical procedure to Government Hospitals is therefore contrary to the very philosophy of RSBY.
Insurance companies should be allowed to purchase the best quality health service at the minimum cost in the interest of the patient. A monopoly of Government Hospitals will seriously hamper this capacity of insurance companies. Though in theory these procedures are available in most Government Hospitals yet in practice service is likely to be denied or delayed for most patients.
I am quite certain that this proposed change in the scheme is likely to be very unpopular with the masses. Moreover if health administrators are so certain that these services are available in all government hospitals it would make sense to remove these packages altogether from RSBY since 100 per cent of the premium is paid by the Government. It appears downright stupid that Government first pays money to the insurance company, who pays it back to the Government to purchase health care services which are in any case available free of cost to all citizens. I have no doubt in my mind that as a result of this proposed change in the rules many beneficiaries will be deprived of these services under RSBY and will have to pay out of packet to the private sector for their treatment. It is a misconception that the private sector will loose. let us not forget that in the health sector there is no real demarcation between the private and the public sector. The same doctor, who provides services in Government Hospitals in office hours, also provides the same services in the private sector during non duty hours.
Refusal of operations in Government Hospitals to shift patients to private hospitals is a well known phenomenon. The private sector will continue to provide these services at a higher cost as individual patients will not have the bargaining power of large insurance companies. Vested interests in Government Hospitals will see to it that a regular flow of patients to the private sector continues.
The second proposal of allowing co-payments under RSBY is worse. Most private hospitals have different types of wards like general ward, semi-private ward, private ward etc. The cost of treatment in these wards differs hugely. Patients in the private ward are charges more not only for the better hotel facilities but also for the medical services provided to them though the service quality of medical services is the same in all types of wards and packages. This is based on the theory of paying capacity. If a person can afford to pay higher for hotel facilities, he can as well pay a little more for the medical services so that services can be cross subsidized for the poor patients in general wards.
logically if a person is willing to pay out of pocket for better hotel facilities in a private ward, such a person does not deserve to get any subsidy from the Government. Such a person should opt out of RSBY and buy private health insurance. This will reduce some financial burden of the Government. let us not forget that in Chhattisgarh the scheme has been universalised under MSBY.
It is expected that the rich will not avail of the services under the scheme because they would not want the hardship of a private ward. If on the other hand co-payments are allowed the rich will drain the entire subsidy meant for the poor. Insurance premium which is already climbing fast will go thro-ugh the roof and the Gove-rnment will find it difficult to fund the scheme. If the co-payments are meant to be for tertiary health care packages not ordinarily covered under RSBY, these copayments should be made for the poor patients not by the patient but by the Government and the rich patients should be asked to pay for the entire package through a privately purchased insurance policy. It is hoped that senior officers will consider all aspects of the proposed changes in the scheme before taking a final call on them.
(Dr. Alok Shukla is a senior IAS officer in Chhattisgarh Government and the views expressed by him in the article are his entirely personal).