Health Insurance for the Poor
For people living below poverty line, an illness not only represents
a permanent threat to their income earning capacity, in many cases it
could result in the family falling into a debt trap. When the need to
get the treatment arises for poor families they often ignore it because
of lack of resources, fearing wage loss, or wait till the last moment
when it's too late. Even if they do decide to get the desired health
care it consumes their savings, forces them to sell their assets and
property or cut other important spending like children's education.
Alternatively they have to take on huge debts. Ignoring the treatment
may lead to unnecessary suffering and death while selling property or
taking debts may end a family's hope of ever escaping poverty.
These tragic outcomes can be avoided through a health insurance
which shares the risk of a major health shock across many households by
pooling them together. A well designed and implemented health insurance
may both increase access to healthcare and may even improve its quality
Genesis of RSBY
In the past Government have tried to provide a health insurance
cover to selected beneficiaries either at the State level or National
level. However, most of these schemes were not able to achieve their
intended objectives. Often there were issues with either the design
and/ or implementation of these schemes.
Keeping this background in mind, Government of India decided to
design a health insurance scheme which not only avoids the pitfalls of
the earlier schemes but goes a step beyond and provides a world class
model. A critical review of the existing and earlier health insurance
schemes was done with the objective of learning from their good
practices as well as seeks lessons from the mistakes. After taking all
this into account and also reviewing other successful models of health
insurance in the world in similar settings, Rashtriya Swasthya Bima
Yojna was designed.