The poor are particularly vulnerable to the financial burden of illness including lost income and medical expenses. Community-based health insurance schemes pool resources to cover the costs of unpredictable health-related events. Research at the London School of Hygiene and Tropical Medicine assessed the performance of the Self Employed Women’s Association’s Medical Insurance Fund in Gujarat.

The Association set up its Integrated Social Security Scheme in 1992 to provide life, medical and asset insurance. The annual premium is 72.5 rupees (US$1.67), 30 rupees of which is earmarked for medical insurance. Women who pay this premium are covered to a maximum of 1 200 rupees (US$ 28) per year in case of hospitalisation. The scheme does not cover certain pre-existing diseases and health problems of addiction. The choice of healthcare provider is open and can include private-for-profit, non-profit or public facilities.

The study analysed 1 930 claims submitted over six years. It assessed:

• coverage according to income groups
• protection of claimants from hospital expenses
• lag time between discharge from hospital and reimbursement
• frequency of use of the fund.

It found that:

• The mean household income of claimants is significantly lower than that of the general population. Reimbursement prevents 3.4 per cent of claimants from falling below the poverty line.
• Reimbursement more than halves the percentage of catastrophic expenditure (more than ten per cent of household income) and hospitalisations resulting in impoverishment, particularly among the poorest.
• The frequency of submission of claims is low - 22 to 37 per cent of the estimated frequency of hospitalisation.
• Private-for-profit, non-profit and public hospitals care for patients in 63.9, 7.5 and 28.6 per cent of claims, respectively.
• Lag time until payment is almost four months after hospital discharge. It is longer for claimants from rural areas than for urban patients.

More than half of the lag time occurs between discharge from hospital and submission of the claim. This may be due to difficulties in collecting paperwork or problems in presenting the claim to the closest association office. Mechanisms that could reduce these delays include:

• providing further education about the benefits of the fund and the claims process
• training association staff who work in villages to accept claims to reduce the need for members to travel
• allowing members to notify the association when they are admitted to hospital, so that a representative can collect the documentation at the time of discharge
• establishing formal links with certain hospitals so that they can submit receipts and certificates directly to the association.

The report suggests that the scheme’s administrators should consider including some excluded conditions in the benefits package if these form a high percentage of non-claimants. It also highlights the need for closer monitoring and evaluating of the scheme.

Source(s):
‘Reduction of catastrophic health care expenditures by a community-based health insurance scheme in Gujarat, India: current experiences and challenges’, Bulletin of the World Health Organization 80 (8): 613-621, by M.K. Ranson, 2002 Full document.

Funded by: UK Department for International Development

id21 Research Highlight: 4 December 2002

Further Information:
Kent Ranson
Health Policy Unit
London School of Hygiene and Tropical Medicine
Keppel Street
London WC1E 7HT
UK

Contact the contributor: kent.ranson@lshtm.ac.uk

London School of Hygiene and Tropical Medicine, UK

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