Health Emergencies: How do the Poor Pay?

MicroSave's India Focus Note 93 describes how low-income families in India deal with medical emergencies in the absence of quality public heath care facilities. It advocates health insurance as an affordable alternative for low-income families. Poor people in India cope with medical emergencies by using savings, loans from various sources, and by pawning or selling assets. The expenditure to meet a major health shock often pushes low-income families into distress. In such a scenario, the note advocates government sponsored health insurance programs or cooperative health insurance schemes that are affordable alternatives for low income families. It states that such subsidized, gender-neutral programs:

• Provide benefits such as claims reimbursement, free hospitalization, free or low cost surgeries, and network hospitals;
• Are new to the low-income population;
• Have had poor penetration due to various reasons such as inappropriate products, lack of insurance awareness, and limited trust in insurance agents and companies;
• Face challenges of sustainability;
• Must be designed to suit poor peoples needs if they are to reach significant scale.