• Prof. Kshitij Patukale

Concept of Health Insurance

Once a man went to a God and asked him, “Oh! God, which of the thing about a human you feel as strange? God laughed and said, “ My Dear Young Man, one thing I find very strange about the human being is that during his prime youth time, he puts in extra labour and amass wealth without caring for his health and at the age of retirement he spends his hard earned savings on health and well being of the body. How strange it is !” During the young age every one runs after money, pursues his job or business without least caring for his health. He accounts for his every hour, every minute and every second. His body tells him, “Oh! My man, please wait, I need some rest, I am not a money making machine. Even the machine needs timely rest”. It has to be oiled and greased. But this falls on his deaf ears. He simply runs recklessly. The purpose for pursuit of earning money is to feed him. But for this very purpose also he does not find time to take food on time. He does not care for simple and balanced food, homemade food, food which suits the digestion system of his body. One should avoid fast food, junk food and excessive non-vegetarian food. He should take care not to take any drink unknowingly. Every intake should be chewed 32 times or at least 16 times. One should concentrate while taking food and his attention should not be diverted. He does not observe these simple basic rules. Under the pretext that he does not have time, he resorts to simply fast eating and start running. Even eminent persons many a times proudly tell, “ I do not find time to eat!” Really, this is a height of it. Everyone should remember that he is a natural creature. Though his body is a mystery, it has its own limitation. Although man’s body organs, mind, wisdom are powerful, those cannot work beyond a certain limit. Rubber can be stretched once or twice but if one continues to stretch it, it is bound to cut. Similarly physical exertion, mental labour and mental tension should be strained up to a certain limit.


In the 21st century man has made tremendous progress in the health sector. He has driven out diseases like small pox, plague, Mahamari like contagious diseases, Hardly you see a patient of T.B. or Polio. The newly developed medicines with advanced technology have achieved triumph over the deceases of mass killing. It is true that this technological advancement is not only boundless but also utterly surprising. At the same time that there are some diseases which have become so friendly with the man that they seize the man till he breaths last. Diseases like blood pressure, diabetes have not left even the small children. Cancer and heart diseases which were rarely seen are now targeting youth in their 30s and they are the victims of untimely death. This is a very horrible state of affair. In good old days falling sick was a usual happening and for curing these sickness, homemade medicines were used to be quite adequate. This had preventive power for Cough and cold, small temperature etc. There were several senior citizens in their 90s claiming that they had not taken even a single tablet of medicine in their life time. However, in the latter part of 19th century there was a revolution with the introduction of the allopathic medicines. Human body was being considered in pieces. Human anatomy, structure of cells in it, structure of each body part and its working was studied scientifically. How the kidney and heart function, for digestion of the food which acids are required, how the body is developed, why any system in the body stops functioning etc. was studied in depth. In the medical sciences numerous branches were conceived and developed. Right from how the baby is born and how DNA develops, how pulse and arteries function were studied. Artery from one place in the body started to be relocated at the other part of the same body. Not only that body parts totally manufactured outside the body were implanted in the human body and they made operative in the body.


There is no doubt, that in the early beginning of the modern medical science, allopathy has given a big leap to the human health. On several never curing diseases medical science has found out treatments, those were advanced and the human life became bearable. Millions of people used to die helplessly. They could see a new ray of hope. There is no disease where there is no treatment. The modern medical science has created a confidence in the human mind that on every disease some of the treatment can be made available and human live can be saved. In the whole world thousands of researchers and scientists have put in unstinted efforts, at times staking their life developed the medical science. Until very recently, it was believed that in the past generation doctor treating the patient was considered to be a second face of the God. The family doctor had become a member of the family. Right from the grand father to the grandson, family doctor used to know about the health of each family member. On a visit to the clinic, he used to pat the patient and say. “Hay, don’t be afraid of! Nothing has happened to you. He used to talk to the patient frankly and while talking he used to understand as to what is wrong with you. He was giving patient confidence and mental support. He used to see his pulse, examine him, if need be conduct himself any test. Today’s modern medical science also says the same thing. Patient’s mental strength cures him. Doctor’s medical treatment helps him to get cured. Doctor means God! I have been examined and treated by my family doctor used to create a confidence that I will be cured positively. In the entire town there used to be handful of doctors. Even in big cities there were no doctors in good number. Of course, that time the medical colleges were also very limited and normally these were owned by the government. Only government Medical Colleges were availing the facility to become a doctor.


However in the last 25 to 30 years, particularly after 1980 there is a sea change in the medical and health science. While medical science was developing, simultaneously mechanical and engineering science was also developed in a big way and it is still continuing. Number of inventions were made in medical electronics, computer, IT, medico mechanical technology and at the same time bio technology, nano technology and other faculties. Due to medical electronics, number of latest medical equipments were invented. This technological advancement for diagnosis of any disease helped for better treatment selection for the patient. It improved the analytical capacity of the medical professionals and the diagnosis was sharp and immediate. Several medical tests and trials were developed based on the technological development. Number of newly invented electronic and mechanical machines was utilized to test the working of the various human body systems like heart, kidney, brain and for conducting blood analysis, measuring blood pressure, counting mental stress. All this benefited a lot to the medical field and the human health. This paved the way for medical machine / equipment centered diagnosis and treatment. Gradually instead of using our own wisdom, knowledge and experience, a system wholly dependent on such machines for diagnosis was put in practice. In this process, when the medical professionals found that they can shift their responsibility on the findings of these machines, the use of machine has been substantially increased. Really speaking there was no reason for all these developments and changes in the medical field to be known to the common man. In the beginning these developments were not known much to the common man. However, gradually he had to suffer for all this and particularly he had to bear more cost of medical treatments. This resulted in heavy increase in total medical expenditure. A lay man found himself as helpless and confused how to raise funds for medical treatment and surgeries. At this juncture, he noticed the health insurance as a great hope to solve this problem.


Thus one can understand that the genesis of the health insurance lies in heavy increase in the medical expenses. In the good old days people used to be afraid of the black coat and they used to say one should not tread a step of the Court. Today, public is afraid of the white coat and they prey God the almighty that during my life please do not force me to step in the medical dispensary! Now a day one has to spend rupees twenty to twenty five thousand for the diagnosis of any decease. In the past, the provision for medical expenses was very meager in the monthly or yearly financial budget. If any elderly person in the family is to undergo any operation then only sizable amount of money was required. There were handful of patients requiring heart surgery, cancer, failure of the kidney, etc. Number of hospitals was less. The government hospital used to provide very good medical treatment. Hence provision for medical cost was by and large not accounted in the family budget. As against it in today’s family financial budget, we have to make a provision of 10 to 20% amount for medical treatments. This is a ground reality. There are several reasons for this. We have seen the advancement in the medical science. At the same time we will have to bear in mind that the ultra modern medical machinery and equipments are very costly, many times – even in crores. Due to specialization, the treatment became focused and accurate which has resulted in increase in the cost of treatment. Simultaneously, medicines and various chemicals also recorded a consistent price hike. The ever increasing population resulted in competition in providing the best of the treatment. This period witnessed commercialization of the medical education. The not grantable medical colleges flooded the scene. It is true that this increased the number of trained and super specialist’s doctors. However, a new approach of looking at the medical education expenditure as an investment came into being. Hence the efforts started for securing fast and higher rate of return on this investment. Status of the doctor used to be judged on the number of beds in the hospital and the ultra modern machinery and equipment available in it. Number of hospitals increased even in the lanes and by-lanes of the cities. Ensuring maximum occupancy of these hospitals became the need and important task for hospital management to recover the investment. At the same time, drastic changes were taking place in the medicines market i.e. in pharmaceutical sector. Although it was possible to market the original patented medicine at a reasonable cost, the pharmaceutical companies started branding their product, and introducing a distribution chain like medical representative, doctor, stockiest, distributor, etc. Naturally this resulted in the price hike of the medicines. Slowly it was beyond the scope of the common man to purchase medicines. The government did not pay much attention to it. On the contrary government control was being relaxed. Even at this stage as long as the individual doctors were running their own private hospitals, the circumstances were to a great extent within control. However, in the first decade of the 21st century when corporatization of the hospitals started taking place, in real sense medical expenses have gone beyond the reach of the common man.


Besides this there is one more aspect that we should minutely observe. Now a days even for small disorder people rush to the doctors. Even for a small illness, cough and cold people get admitted in the hospital. They undertake various medical tests to avoid risk and thus empty their pockets until the doctors and they them self gets satisfied. This mentality and psychological frame of mind has contributed to the rise in medical expenses. One more dangerous aspect is – self medication. People buy drugs by exchange of physical deficiency with the pharmacist without going to the doctor for consultation merely to save money. This is a horrible exercise and very very risky. Sometimes it helps for immediate relief but in turn it results in side effects which pave the way for a new illness. The scope of medical expenditure and the commercialization of the medical services are quite large. However, undoubtedly, this has badly affected on the medical expenditure required to be incurred by the common man. It is not possible for a common man to have thorough knowledge of the medical field. But when he started becoming a victim of it, naturally he started finding out alternative measures to fight this situation.


During the life time everyone expects that he should have a disease free life. And it is his right also. Really speaking, everybody wishes that he should not fall sick and need not be required to step in the hospital. But in today’s fast changing and dynamic life style, everyone knows that it is very difficult. Increase in frightening pollution, fierce traffic, contaminated and poisonous food items, cutthroat competition, vanishing values, government’s neutral approach, social recklessness etc. does make an impact – direct and indirect – on everybody’s life. At such time, physical and mental risks have gone beyond reach. We have to live in this world accepting number of helpless situations. At such circumstances, it is very difficult to be away from sickness and hospitalization. Hence it becomes incumbent to make advance preparation to fight against this situation.


Insurance means financial protection from the likely unpleasant incidents in future. The relatives of the demised insured person get some protection and their problems are eased out due to life insurance. From the vehicle insurance protection is available from the losses due to accident to the vehicle. If we consider the health insurance, it is observed that the concept of health insurance is quite large and along with the changing times it is also getting widened and widened. If an insured person requires medical treatment he can make financial provision through the health insurance. Today, due to dynamic life style, human health is getting worsened. But at the same time, due to medical advancement, new medical treatments and medicines are available for various diseases. Of course due to this development, the medical expenditure has also substantially increased. Therefore, it is the bitter truth that the benefits of these advancement in medical science is available to the few selected people who avail the financial support. Health insurance mechanism provides protection from the likelihood of financial losses due to hospitalization but sometimes the policy holder also gets financial support for better medical treatment. Health insurance thus can also turn to be a life saving tool.


We can get financial protection in case of need by purchasing life insurance but we cannot increase the life span. By taking vehicle insurance we cannot reduce the chances of accidents. But due to health insurance, we get financial protection for the likely losses due to hospitalization and treatments on various diseases. At the same time, there is possibility of the death of the policy holder while treatment is going on in the hospital. If a person has a serious disease then he is more worried about the likelihood of substantial medical expenditure he has to incur and this tension is also responsible to increase the gravity of the disease. At this stage the health insurance is very much helpful to get rid off these tensions and stress.


Health insurance is an effective instrument of getting reimbursement of medical and hospitalization expenditure. No one can control the ever increasing medical expenditure. We can neither reduce expenditure on hospitalization nor can beg the specialist doctors to reduce their fees. We cannot reduce the number of medical tests and reduce the expenditure on it. We cannot hope that the medicine prices will be reduced. But for fighting such unknown circumstances, one can make provision of availing large sum of money through the mechanism of health insurance. Accidents and hospitalizations do not occur by invitation. At any point of time and any member in the family has to face the medical treatment. Health insurance is one such best scheme to be adopted for unknown medical risk, during young age, when one is earning. It is meaningless to start digging well when one is got thirsty. If adequate money is not raised when required, one has to risk his life in the absence of the medical treatment. Many a times one feels that I am quite OK and fit. What is the necessity for me for the medical insurance? Sickness come during old age and in the retired life. Let us think of it when we reach at that stage. But this is not a good thinking. We around ourselves see cases when people have to lose their life due to lack of medical treatment in time. We also see number of cases wherein for meeting medical expenditure, people have to dispose off their land and property after spending all cash, savings and gold. There is no option for Health Insurance. Health insurance is relatively cheaper. If it is taken during young age it is still cheaper. If one takes a family health insurance policy it becomes still cheaper. Health insurance leads to savings in income tax. Hence, the need of the hour is that everybody should take a mediclaim and health insurance at the earliest.

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© 2018 Kshitij Patukale, Pune