Budget 2020: Ayushman Bharat expansion a great step, but lot more still required

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By Piyush Jain

Budget 2020-21: The Government has definitely taken a great step with the expansion of the Ayushman Bharat Scheme, which is targeted to help poor patients. Middle-class patients, on the other hand, suffer the brunt, as an average health insurance cover is only Rs 5 lakh. Given the increased cost of secondary and tertiary healthcare in India, which is rising at a compound annual growth rate (CAGR) of 15-20%, a Rs 5 lakh coverage is insufficient. A lot more is required to ensure complete health coverage of India's more than 1.3 billion population.

The missing middle-class 

As much as 70% of the middle-class population in India has no health insurance. When middle-class families are faced with the challenge of raising funds for a critical illness – say cancer or a liver transplant, both of which might cost anywhere between Rs 10 lakh and 50 lakh depending upon complexity and stage of disease – under a demanding deadline due to the risk of death, the financial stress is enormous. 

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Most families have to resort to selling homes, mortgaging jewellery, losing their savings or borrowing money from lenders at a very high rate of interest due to an urgent need to finance a hefty bill. 

Out-of-pocket healthcare expenses i.e. expenses not reimbursed by government or insurance, in India is thrice the global average and is 61% of total healthcare expenditure. 

However, despite trying all financing methods, families often have to face the unfortunate scenario of losing their loved ones. Unfortunately, they are simply not able to recover. This is how medical expenses push people into a debt poverty trap in India.

So what can be done about lack of funds?

Crowdfunding platforms have a formidable value proposition for such patients. Healthcare crowdfunding is an alternative method of raising funds online for medical expenses, with the patient (or his/her friends or family) primarily relying on social media networks to mobilise donors to finance the relevant medical bills. Typically, each of these donors contributes relatively small sums of money online to help raise a much larger goal amount. For example, 200 donors contributing Rs 5,000 each can mobilise Rs 10 lakh for cancer surgery in less than 24 hours. The additional advantage of crowdfunding is that patients do not have to repay that money back to the funders as the money provided online is a donation and not a loan.

Take the case of Praveen Pudi, an employee at Capgemini Hyderabad, who met with a road accident some time ago. When insurance and medical loans didn't seem to help, crowdfunding covered Praveen's surgery expenses and a prosthetic hand.

The anticipated 'Whatsapp Pay' launch in India

Crowdfunding is driven by a culture of generosity and a high propensity for people to pay digitally through social media. Crowdfunding in India is set to grow exponentially once friction on payments within social media reduces even further. We believe the future of digital payments is going to be on WhatsApp. In China, crowdfunding almost entirely works on WeChat and WeChat Pay and is scaling rapidly. 

For Mumbai resident Amit Shenoy, who was admitted at Apollo Hospitals Navi Mumbai, our platform ImpactGuru.com helped raise Rs 45 lakh in 7 days through crowdfunding. Amit was diagnosed with Acute Myeloid Leukemia (blood cancer) and was recommended to opt for an Allogenic Stem Cell Transplant. Amit's wife Gopi took the crowdfunding route to fund the mounting expenses of Amit's treatment. Gopi actively shared the fundraiser within her network – WhatsApp, Facebook and Instagram were extensively used. Gopi's network further shared the appeal within their social circles through WhatsApp. That being said, we believe, the key for crowdfunding growth in India will be a very strong integration within WhatsApp for payments so that the payments become frictionless.

(The author is the Co-Founder and CEO of ImpactGuru.com, which is a healthcare financing platform for patients and raises money online for medical expenses via crowdfunding. The views expressed in the article are personal.)