Emergence of Health Insurance as an Alternative to Out-of-Pocket Expenses

Introduction: In recent decades, India has witnessed a significant transformation in its healthcare landscape, with an increasing emphasis on reducing the burden of out-of-pocket healthcare expenses. Out-of-pocket expenditure, traditionally the primary means of financing healthcare in the country, often leads to financial distress and inadequate access to quality medical services for millions of Indians. The new Indian National Health Policy is in place to strengthen India’s healthcare system and provide universal access to good quality healthcare services to all. To attain this target, the Indian government started Ayushman Bharat Yojana, the world’s biggest health program, in 2018, which might represent a major step towards achieving universal health coverage in India. Even though the Indian government is taking steps to enhance public health, much more must be done to provide universal coverage. Individual spending on health care in India has increased significantly over the years. Although health insurance is a good alternative funding mechanism and has grown significantly over the years, the Indian population’s spending on health has not decreased. Conclusion: This paper examines health insurance’s emergence and growing adoption as a viable alternative for out-of-pocket expenditure in India. It delves into the factors driving the rise of health insurance as a preferred financial tool for managing healthcare costs and explores the impact of this shift on the Indian healthcare system. As the country continues to tackle the financial burden of healthcare, policymakers and stakeholders must work collaboratively to ensure the efficient and equitable implementation of health insurance initiatives throughout the nation.