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The government is moving towards covering the ‘missing middle’ of over 40 crore population with medical insurance, and has shortlisted 21 insurers who may offer a highly subsidised cover as part of a pilot project on voluntary basis.

The PM Jan Arogya Yojana (PMJAY) presently benefits around 50 crore poor families in the country with a free insurance cover of Rs 5 lakh for an entire family. A senior government official told News18 that a “PMJAY clone cover” will be offered by the commercial insurers to over 40 crore additional people on voluntary basis which will be in the nature of “self-funded affordable cover”.

These will be group covers for the entire family of those who currently do not have any kind of medical insurance. This will also be a step towards ‘Universal Health Coverage’ (UHC), the senior official added.

Apart from the 50 crore poorest people covered by the PMJAY scheme, 3 crore people are covered by various state schemes, 15-17 crore are covered by other central government schemes like ECHS, ESCI and CGHS, while around 14 crore people in the country have opted for private insurance companies at their own cost.

That still leaves more than 40 crore people who have no medical insurance cover of any kind, who have been termed as the ‘missing middle’. The government feels that in the absence of any medical cover and given the Covid crisis, this ‘missing middle’ may fall into poverty in the case of a catastrophic health expenditure.

At a recent presentation, a senior advisor to the National Health Authority (NHA) said these people do not buy medical insurance cover due to “unaffordable expensive products, shallow coverage and pre-existing exclusions, lack of awareness, high claims cost and operating expenses and difficulty in reaching informal sector segment of population”.

The 21 shortlisted insurers include Max Bupa Health Insurance Co. Ltd, Royal Sundaram General Insurance Co. Ltd and other leading private and public insurers. The insurers have been asked to give details like the proposed group they plan to cover, their geographical location, the product features, premium per family, proposed hospital network among other things.

The government plans to sign an MoU between the National Health Authority and the insurance companies before commencement of the pilot project.

The Foreign Example

India has studied examples abroad for such steps towards Universal Health Coverage (UHC). At a recent presentation to the government, a world body said countries like Brazil, UK, Norway, Denmark, Greece, Portugal, Italy and Spain have made entitlement universal and general tax-financed and extended fully-subsidised coverage to non-poor informal sector.

Countries like Thailand, Indonesia and Vietnam have expanded fully-subsidised coverage beyond the poor to the near-poor and vulnerable groups while Chile has a defined guaranteed service package for everyone regardless of insurance status.

Russia and Kazakhstan have used diversified revenue sources to provide universal entitlement regardless of employment status. India, however, faces a challenge of a large population of over 130 crore people.

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