Bengal Global Business Summit: Need for evolved insurance mechanism, says Devi Shetty
Telegraph | 8 February 2025
The only hope to transform India’s health care is a wider and more evolved insurance mechanism to make quality health care accessible to a larger population, feted cardiac surgeon and entrepreneur Devi Shetty said on Thursday.
Shetty, the chairman of Narayana Health group, who came to Calcutta to attend the Bengal Global Business Summit (BGBS), underscored the importance of technology and competition to bring down treatment costs without compromising the quality.
“Without a wider insurance network, there is no hope for transforming India’s healthcare,” Shetty told The Telrgraph on the sidelines of a session on health and health services at BGBS.
“Every year in India, 70 million surgeries are required but hardly 25 million surgeries are done. People don’t have the cash to access healthcare facilities. When they access the healthcare, the cost will go down,” said Shetty. “Who will pay for their access to healthcare? Health insurance companies will have to pay,” he said.
Shetty said that in some countries, governments pay for people’s healthcare. “But it is impossible in a country like India with such a large population. The government can’t provide for the healthcare,” he said. “So, people will have to pay but they cannot afford. This is why we need more intervention from the health insurance sector,” said Shetty.
The Telrgraph reported on Thursday how refusal by insurance companies to pay for oral drugs taken at home or modern treatment like immunotherapy and targeted therapy forces many cancer patients to stop treatment midway.
According to Shetty, more than 65 per cent of a family’s healthcare expenditure is out of the hospital and that is not covered by insurance.
There are many drugs whose costs are very high because most people do not buy them.
“They cannot afford the expensive drugs. More people will buy the drugs if health insurance companies cover them. The cost of production would go down and so would the prices,” Shetty pointed out.
Narayana Health has recently entered the health insurance business and has launched its product in Bangalore.
“We want to provide primary care and cost of medicines and doctors’ consultations at huge discounted rates for the beneficiaries of our insurance scheme,” he said. The scheme provides ₹1 crore coverage for an annual premium starting from ₹10,000 for a family of four.
He said the scheme would be launched in Calcutta in the next three to four months. Already there are more than 7,000 beneficiaries of the scheme in Bangalore.
Technology
Improvement in technology would also help bring down the cost of treatment, said Shetty.
“When I was a medical student X-Ray was the most expensive test because of the films. Now, it has become digital and the cost is affordable,” he said.
Narayana Health has spent ₹600 crore to set up digital platform helping in paperless operations.
“Technology increases operational efficiency and reduces costs,” he said.
More competition
More beds set up would lead to competition that can bring down treatment costs, said Shetty.
But at the same time, productivity also needed to be increased.
“At many hospitals, the operation theatres are not utilised for more than five hours. It should go up to 14 to 15 hours. Then the costs would go down,” he said.
Once productivity increases, more money is generated and new hospitals can come up.
“But to increase the productivity of a hospital, we need more people to access the healthcare,” said Shetty.