[Reader-list] Health smart cards for India's poor

[Taha Mehmood]

http://www.futuregov.net/articles/2009/jan/06/health-smart-cards-indias-poor/

 Healthcare
Health smart cards for India's poor

By Alice Kok | 6 January 2009

The Indian government will bear the treatment costs of the poor under
a new health insurance scheme. Using a smart card embedded with 11
types of software, patients can now afford the services of private or
government hospitals through cashless and paperless transactions.



    * Health card launched for Indian expatriates



Nearly 65 per cent of India's poor get into debt and one per cent fall
below the poverty line each year because of illness, according to
National Sample Survey Organisation (NSSO). Health insurance can
lighten the medical cost but only six per cent of India's workers have
it. Free public hospitals are not an option as two out of five doctors
are absent, and there is a 50 per cent chance of receiving the wrong
treatment.

This state of affairs is set to change dramatically with Rashtriya
Swasthya Bima Yojana (RSBY), a visionary national health insurance
scheme, which provides US$620 in patient health benefits at a premium
of US$12.40, which the government pays if you are poor.

A patient can choose from almost 1,000 private or government
hospitals. States can choose from 18 public or private insurance
companies. Insurers have the incentive to recruit the poor as they
earn premiums by doing so.

This scheme gives the poor the choice of exiting a bad hospital, hence
creating a more competitive environment for hospitals.

The insured carry a smart card with a photo and fingerprints of the
family. This card will make cashless and paperless transactions for
the 725 pre-agreed medical procedures. The card contains a value of
US$620 and it tracks daily hospital expenses with money deducted
automatically after each procedure has been performed. There will not
be a need for pre-approval or reimbursement as these smart cards are
designed to prevent fraud with 11 unique types of embedded software.

So far 500,000 cards have been issued in six months covering 2.5 million people.

If all goes according to plan, 300 million people—or one-third of
India—will be covered in five years at an annual cost of US$928
million.

Smart cards can also carry data on payments for rations (PDS) or
earnings from employment schemes (National Rural Employment Guarantee
Scheme) and can expose corruption very quickly.