India’s health insurance gold rush?

As new business models evolve in India’s private healthcare sector, what’s interesting is that the latest strategies in the private sector are on the health insurance side. Even as India’s national health insurance scheme i.e. Ayushman Bharat Pradhan Mantri Jan Aarogya Yojana (PMJAY) expands to include senior citizens over 70 years irrespective of income criteria, there are signs that more stakeholders are now willing to look at creative/collaborative health insurance models, to expand insurance coverage and finance health spends.

Our September edition had a detailed cover story on the shifting landscape of insurance in India (https://www.expresshealthcare.in/insurance/indian-health-insurance-a-shifting-landscape/445736/). The latest healthcare provider to foray into health insurance, Narayana Health’s Aditi plan offers Rs 1 crore for surgeries and Rs 5 lakh for medical management at Narayana Health network hospitals.

Narayana Health is not the first healthcare provider to foray into health insurance. The question is, can it succeed when predecessors have had mixed results? 

Way back in 2007, the Apollo Hospitals group’s insurance foray resulted in Apollo Munich Health in 2007. This was sold to HDFC in January 2020, and is now merged with HDFC’s general insurance arm, HDFC ERGO. Some media reports surfaced in December 2023 that Apollo Hospitals was contemplating another foray into insurance.

In 2008, Max India tied up with UK-based healthcare services expert, Bupa for a joint venture, Max Bupa Health Insurance. By end 2019, Max India had exited the health insurance JV, selling its stakes to Fettle Tone LLP, an affiliate of True North Fund VI LLP, with the health insurance business rebranded to Niva Bupa.

In 2012, Religare Health Insurance was established as a JV between Religare Enterprises, Union Bank of India, and Corporation Bank. Fortis Healthcare and Religare Health Insurance (renamed as Care Health Insurance in 2020), were both promoted by brothers Malvinder and Shivinder Singh. Today, Religare Enterprises, the holding company of Care Health Insurance, is caught in the eye of a stormy takeover battle between the Burmans of Dabur and the Religare board. In 2018, the Manipal Group formed a joint venture partnership with Cigna Corporation and TTK Group, resulting in ManipalCigna Health Insurance.

In the past week, insurance broker Policybazaar’s parent company PB Fintech’s announcement that it was earmarking up to $100 million for a 20-30 per cent stake in a new healthcare company, structured along the lines of a Health Maintenance Organisation (HMO) model, has garnered a lot of interest. Though this is still at the planning stage and will need board approval, it indicates a stirring of the health insurance pot in India. Could this set the stage for more such collaborations? It’s fair to say that while many would like a shot at India’s health insurance market, finding the right balance has been tricky. The proverbial pot of gold remains elusive, but as more people seek health insurance after the COVID shock, perhaps the time is finally right.

The rationale for hospitals venturing into insurance and vice versa is the same: bridging the trust gap between the three Ps: patients, providers (hospitals) and payers (insurance companies). 

Prima facie, patients would benefit as hospitals would keep costs reasonable. Hopefully, the discharge and the claims process would also be a lot smoother. Payors and providers would be able to nudge the insured population to monitor their health parameters. Once incentivised to keep patients healthy to reduce claims, the focus should shift from ‘sick care’ to ‘health care’, with the aim to remain healthy and prevent, delay and manage the onset of disease conditions. 

But that’s in theory. Let’s hope reality lives up to the stated mission/vision. And of course, revenue projections.

[email protected] 

[email protected]