Economic gradients of health insurance coverage in India

Universal Health Coverage (UHC) aims to ensure accessible, affordable, and quality healthcare for all. In India, achieving UHC is challenging due to very low public health expenditure and a highly privatized healthcare system. This places a significant financial burden on households, often pushing them into poverty and catastrophic health spending. Health insurance is a key tool for reducing financial risk and improving access to healthcare. The study attempts to examine the economic determinants of health insurance coverage in India. It also assesses the temporal-economic gradients of health insurance coverage.

The National Family Health Survey (NFHS) rounds conducted during 2005-06, 2015-16, and 2019-21 were used. Overall health insurance coverage and different types of health insurance coverage were estimated by the two main economic variables namely wealth quintile and Below Poverty Line (BPL) status. The logistic regression models were applied to estimate the adjusted odds ratio of health insurance coverage by the socioeconomic variables.

There has been notable progress in enhancing insurance coverage, particularly among poor, primarily through Government-sponsored health insurance (GSHI) schemes. However, a considerable proportion of impoverished households (64 percent of poorest and 58 percent of poorer households) remains without any insurance coverage, largely stemming from a lack of awareness and issues of identification of target groups. Conversely, a notable portion of the middle (71 percent) and affluent classes (70 percent) are accessing the benefits of the GSHI scheme compared to 54 percent among poorest households, mainly due to leakage issues. Consequently, there is a need to recalibrate the exclusion of the middle and affluent classes and the inclusion of the poorest within existing GSHI schemes like PM-JAY. There is need to implement appropriate strategies such as linking SECC data with Aadhaar, conducting regular enrolment audits, developing state-level targeting metrics, and using community-based enrolment to reduce identification errors and leakage. These should be paired with broader reforms, including integrating state and central schemes, expanding outpatient coverage and awareness, regulating private providers, and strengthening primary healthcare alongside insurance expansion.