What you can do to reduce health care costs

The executive, who did not wish to be identified, said he was initially not worried about the expense as he had an insurance cover of Rs 5 lakh. But, he did not pay attention to some other things. First, the hospital where he was admitted said he would have to pay immediately 50,000 for the admission – it informed him that he was not eligible for cashless admission as the hospital was not part of the insurer’s network. He was told that he can get his claims reimbursed by the insurer after he is discharged from the hospital.

His brother paid the admission fee using a credit card. After the surgery, the executive was told that he would have to pay 33,350 at the time of his discharge. their total bill was due 83,350 and he had already paid 50,000 at the time of his admission. The executive, who had no savings for such contingencies, had to use his credit card again. When he contacted the insurer, the firm’s third party administrator, or TPA, said he was only eligible for reimbursement 42,330. He was told that the insurer would pay the amount within 30 days of receipt of the claim and submission of all bills and discharge certificates from the hospital. The executive thus had to pay a total of approx. 41,000 from his own pocket.

This executive’s experience is not unique and perhaps explains the out-of-pocket expenses, or OOPE, that most insured persons have to bear during any hospitalization. For starters, most insurers do not cover expenses related to consumables, such as single-use disposable medical aids used during surgery.

One of the biggest challenges facing the Indian healthcare system is high OOPE as it places a significant financial burden on the families of patients. They may have to borrow money (credit card, personal loan) or even sell assets (mutual funds, PF, gold) to pay for medical expenses. While people with higher incomes can afford to pay for expensive medical treatment, those with lower incomes must forgo medical care or rely on substandard services. This can create a vicious cycle of poor health outcomes and limited economic opportunities. Also, many people may delay getting treatment until their condition worsens, which leads to higher health care costs and worse health outcomes.

OoPE in India is estimated to account for about 62% of the total health expenditure. Indian households spend an average of 7.9% of their entire annual household consumption expenditure (monthly running expenses for your household) on health.

A major reason for this is that 82% of urban households in India are not covered by any health insurance scheme, as a result of which 55% of all hospitalizations are financed through household savings and 23% through borrowings.

Here are some ways to reduce OOPE:

health insurance: This is one of the most efficient ways to reduce OOPE. Buy as much insurance cover as you can afford.

Healthcare Credit Line: Take advantage of a no-cost healthcare credit line, which gives you quick and easy access to funds that you can borrow and pay back at no cost, up to any premiums paid by your health insurance. covers the cost.

preventive care: Regular check-ups, vaccinations and screening tests can help you find health problems early and prevent them from becoming more serious and costly to treat.

Comparison Shopping: Compare prices from different healthcare providers to find the most affordable option for your medical needs.

Conversation: Try to negotiate with the healthcare provider for a lower price. Many providers are willing to give a discount if you pay in cash or in advance.

Government Health Facilities: These provide medical services at subsidized rates or free of cost. While the quality of care can vary, these facilities can be a cost-effective option, especially for routine check-ups and minor illnesses.

Chris George is the Co-Founder and CEO of CubeHealth