Demonetisation may usher in the era of cashless healthcare

The demonetisation of banknotes of denomination Rs 500 and Rs 1,000 took the country by surprise. Temporary inconveniences apart, this bold move has given great impetus to the growth of a cashless economy in the country. This is a significant step forward for the healthcare industry.

Out-of-pocket expenses
Healthcare is a recurring and expensive occurence for every family. Recent reports suggest that primary healthcare accounts for over 70% of all medical spend, and pegs the market at around Rs 1,35,000 crore. This, by corollary, indicates that the overall healthcare market in the country stands at approximately Rs 1,80,000 crore. Only 2% of the Indian population is covered by individual health insurance policies; and only another 4% is covered under group medical policies. This suggests that a significant portion of healthcare expenses today are borne out-of-pocket by Indian families. Considering the fact that one usually transacts with notes of higher denominations for payments at medical centres, demonetisation has had a direct impact on the ability of families to manage their medical care.

Medical inflation in India stands at 12-15% against a global average of 6-7%. With this rapid rise in cost of medical care, people are increasingly opting for health insurance policies to mitigate the risk of high out-of-pocket expenses. This is fuelling the growth of the health insurance industry, and therefore, the adoption of cashless hospitalisation.

Add to this, the proliferation of the internet and mobility in India. Indian citizens, even in the hinterlands, are prominent users of smartphones and enjoy access to internet. They are able to leverage unique digital payment concepts such as e-wallets, mobile wallets, Aadhaar-based payment systems, and the more recent payment mechanism based on Unified Payment Interface (UPI).

Beyond digital payments
The benefits of cashless hospitalisation, in fact, go beyond the ease of making payments electronically. Insured beneficiaries can completely eliminate payments towards medical expenses that are covered under their policy; they can reduce their overall cost of care by leveraging the preferential tariffs enabled exclusively for cashless hospitalisation at network hospitals; and they can enjoy green channel admission at the hospital. Members can then choose an electronic payment platform of choice only for the out-of-pocket component of the expenses related to the hospitalisation.

Innovations such as eCashless make cashless hospitalisation more actionable. With eCashless, members can schedule a hospitalisation from the comfort of their homes using their mobile phone. They also get full visibility into their cost of treatment upfront, and can completely eliminate wait time on the date of admission.

Cashless for outpatient care
Cashless facility is today mostly geared towards in-patient hospitalisation. But as insurance products mature, cashless medical care will soon cover outpatient expenses and spend on medicines as well. Curated online networks such as MediBuddy Infiniti allow members to schedule outpatient services such as doctor consults, health checks, home healthcare, medicines and more, online, and avail them in a cashless format if they are covered under a health insurance policy or corporate health benefits programme.

Convergence and mobility
As we move further into the era of cashless care and digital payments, every member will be able to use just a mobile app for all their healthcare needs. Using a GPS-enabled map, the mobile app would enable the user to locate network hospitals in the vicinity, who can compare hospitals based on the facilities available, doctors, rooms available, peer rating, etc. The user can then opt for an eCashless hospitalisation, with full visibility into estimated cost, from the comfort of her home. After a comfortable hospitalisation and recovery, the user can order medicines, schedule follow-up consultations, and also select preventive health screening packages through the app.  And as the user traverses the healthcare continuum, one can avail all services covered under the policy in a cashless format — a truly integrated, cashless approach to healthcare.

Cashless for public healthcare
Cashless facility outside the realm of in-patient hospitalisation also calls for the government to implement the Universal Health Coverage programme. In fact, managing health benefits for a large, diverse and populous country like India is no easy task. Cashless delivery of healthcare is at the heart of all successful public healthcare schemes; and technology plays a critical role in enabling healthcare to millions of indigent Indians across multiple states.

Biometrics-based e-cards for beneficiaries that enable paperless identification of beneficiaries; online submission of preauthorisation for beneficiaries looking to claim their benefits at a network hospital; SMS-based and mobile app-based claims tracking; integration with government systems for utilisation tracking and MIS (Management Information System) reporting; and data analytics for government decision makers to derive insights from the enormous amounts of data collected from across the nation; technology can transform the administration of public healthcare schemes.

A cashless, paperless and mobile-enabled model is the future of the healthcare industry. This future can most certainly be realised when all stakeholders collaborate with each other to utilise a common technology platform that connects Indians anywhere in the country with healthcare providers of their choice.

(The author is Chief Business Officer, Medi Assist)