HEALTH SCHEMES AND

INSURANCE

BY- MS. DIVYA KHATRI

◦Health insurance programme, people who have the risk
of a certain event contribute a small amount (premium)
towards a health insurance fund. This fund is then used
to treat patients who experience that particular event
(e.g. hospitalization).
◦Definition “Health insurance, like other forms of
insurance, is a form of collectivism by means of which
people collectively pool their risk, in this case the risk of
incurring medical expenses.”
OBJECTIVES-
Health insurance programme have two main objectives:
• To increase the access to health care
• To protect the employees from high medical expenses at the
time of illness.
HISTORY OF HI IN INDIA

• 1923: Workman’s compensation Act.

• 1948: ESI Act passed.
• 1952: First ESI hospital established.
• Mudaliar Committee(1959-1961) recommendations: – Long
range health insurance policy for all. – Small fee for availing
health services.
• 1999: IRDA act passed.
• 2001: Insurance amendment Act
PRINCIPLES OF INSURANCE

◦Utmost good faith

◦Insurable interest
◦Principles of indemnity
◦Principle of Subrogation
◦Principle of loss minimization
CHARACTERISTICS OF HI

• It is contract between an insurance company and an

individual or his sponsor (e.g. an employer).
• The contract can be renewable annually or monthly.
• The type and amount of health care costs that will be
covered by the health insurance company are specified
in advance, in the member contract or "Evidence of
Coverage" booklet.
 HEALTH SCHEME IN INDIA
IT IS MAINLY CLASSIED INTO FOUR
-Mandatory Health Insurance schemes -The two mandatory
government run schemes includes:
◦1.Central Government Health Schemes (CGHS)
◦2. Employee’s state insurance scheme (ESIS)
-Employer based scheme -The railways, defense and security forces
provides medical benefits to the employees
-Voluntary Health Insurance Schemes Or Private For Profit Scheme
The Government of India has brought out several Health schemes
that are run for the health benefits of the common man. A few
notable ones among them are:
◦Rashtriya Swasthiya Bima Yojana (RSBY)
◦Aam Aadmi Bima Yojana (AABY) and Janashree Bima
Yojana (JBY) 
◦PMJAY- Ayushman Bharat
Central Government Health
Scheme (CGHS): 

INTRODUCTION
◦Started under the Indian ministry of health and family welfare
in 1954.
◦The scheme was started in Delhi in 1954.
◦The scheme was extended to the17 cities all over the India
(allahabad,ahmedabad,bangalore,mumbai,kolkata,hyderbad,
jaipur ,jabalpur, lucknow ,Chennai ,westbengal , nagpur, patna ,
pune ,kanpur,guwahati, Thiruvananthapuram)
OBJECTIVES-
Components of the Central
Government Health Scheme (CGHS)
◦The dispensary services including domiciliary care.
◦F. W. & M.C.H. Services.
◦Specialists' consultation facilities both at dispensary, polyclinic
and hospital.
◦Level including X-Ray, ECG and Laboratory Examinations.
◦Hospitalization.
◦Organization for the purchase, storage, distribution and supply
of medicines and other requirements.
◦Health Education to beneficiaries.
 Beneficiaries of the Central Government Health Scheme
(CGHS)

◦The current working employees of Central Government and

their dependent family members living in CGHS covered areas.
◦Existing and Former members of the Indian Parliament.
◦Former governors & Lieutenant governors of India.
◦Freedom Fighters of India.
◦Former Vice Presidents of India.
◦Existing and Former Judges of Supreme Court & High Courts of
India.
◦Workers and Pensioners of selected autonomous organizations
in the Delhi state.
◦Journalists qualified with PIB (In Delhi Only).
◦Police Personnel (In Delhi Only).
◦Workers of Railway Board.
Eligibility for Central Government Health
Scheme

◦ All employees of the central government who receive wages from the
Central Civil Estimates.
◦ All dependent family members of Central Government employees who
receive wages from Central Civil Estimates and are residents of areas
covered under CGHS.
◦ Pensioners and family pensioners of the Central Government.
◦ Eligible dependent family members of pensioners and family pensioners of
the Central Government.
◦ Members of parliament
◦ Ex-vice presidents
◦Ex-Governors & Lt. Governors
◦Retired/sitting judges of high courts and Supreme Court.
◦Freedom fighters
◦Journalists accredited with Press Information Bureau
◦Employees of the Railway Board
◦Delhi Police Personnel in Delhi only
◦Pensioners and employees of certain statutory/autonomous
bodies that have been extended CGHS facilities in Delhi.
◦Post and Telegraph Department Employees.
Types of Medical Systems
Covered Under CGHS
CGHS provides health care through following systems of
Medicine:
◦Allopathic
◦Homoeopathic
◦Indian system of medicine
◦ Ayurveda
◦ Unani
◦ Siddha and
◦ Yoga
Facilities Offered Under Central
Government Health Scheme (CGHS)

◦OPD Treatment including issue of medicines.

◦Specialist Consultation at Polyclinic/Govt. Hospitals.
◦Indoor Treatment at Government and Empanelled Hospitals.
◦Investigations at Government and Empanelled Diagnostic centers.
◦Cashless facility available for treatment in empanelled hospitals
and diagnostic centers for Pensioners and other identified
beneficiaries.
◦Reimbursement of expenses for treatment availed in
Govt. /Private Hospitals under emergency.
◦Reimbursement of expenses incurred for purchase of
hearing aids, artificial limbs, appliances etc. as specified.
◦Family Welfare, Maternity and Child Health Services.
◦Medical consultation and dispensing of medicines in
Ayurveda, Homeopathy, Unani and Siddha system of
medicines (AYUSH).
Cost of Central Government Health Scheme
(CGHS) Facilities

For Pensioners
◦In case a pensioner wants to avail the facilities of CGHS they will
also have to make a contribution according to the grade pay they
were entitled at the time of their service. The contribution can be
done as yearly contribution and one time contribution:
◦Yearly Contribution: Every year a certain amount of money (as per
grade pay) is to be contributed towards CGHS.
◦One Time Contribution: A pensioner pays onetime contribution
amount towards CGHS for 10 years. It will be considered as a life
time contribution.
For Serving Government Employees
◦A central government employee, who is currently serving in CGHS
covered area, is bound to take the CGHS card. A deduction is
made from the salary by their department every month, which
depends upon the grade pay of the serving employee.

Required time to get CGHS Card

◦A printed index card of CGHS is issued on the day of application
for CGHS. Later, the plastic cards are issued and sent to the
concerned card holders within 3 weeks. The cards are sent to the
residence of the government employees.
Treatments Not Covered Under Central
Government Health Scheme (CGHS)

◦Follow-up and In-patient Treatments are not addressed in

case of the following:
◦In case of a declared emergency, the treatment can be done at
any hospital, but the reimbursement claim can only be submitted
to the Additional General where the CGHS card is registered.
◦In case of reimbursement of medical bills, the beneficiary can be
treated at any hospital and the claim amount will be limited to the
rates as per mentioned under CGHS. The reimbursement claim can
only be submitted to the Additional General where the CGHS card
is registered.
Central Government Health Scheme (CGHS) &
Mediclaim Policy

◦An individual may have a Mediclaim insurance policy also along

with the CGHS. If due to the medical emergencies, the individual
is treated in a private hospital, and some of the bills are paid by
the insurance company, the individual will still be able to get the
rest of the cover from CGHS.
◦All the medical bills submitted to the insurance company and the
duplicate bills with certificate from Insurance Company will be
claimed from CGHS by the pensioner. The serving employees will
have to contact their concerned departments for getting the
balance from CGHS.
◦CGHS in Private Hospitals-
◦CGHS is only provided in the Government hospitals and the
empaneled private hospitals under CGHS. But if an individual
faces an emergency and is treated from a non-empaneled private
hospital, the expenses are reimbursed as per normal CGHS rates.
Surgeries at Private Empaneled Hospitals under
CGHS-

◦Before proceeding for doing a surgery, an individual will have to

obtain advice from a government specialist/ CMO i/c of Wellness
Center.
◦However, to obtain advice, pensioners will have to apply to CMO i/c
of Wellness Center for getting the permission before doing the
surgery. However, CGHS will provide reimbursement at CGHS rates
to contact their respective department/office.
◦Central Government Health Scheme is an important and unique
scheme that is introduced in India to help the Government
employees in providing medical care.
How it is useful for people
◦Over 15 lakh people have been benefited from health
scheme.
◦The people of the country are one of its most valuable
resources.
◦These programs are aimed at increasing the standard of
health of the people and decreasing the incidence of
disease and death due to illness.
 EMPLOYMENT STATE
INSURANCE SCHEME (ESIS)
APPLICABILITY
◦ Act applies to factories using power not using AND Employing 20 or more
persons. Gradually extended to the following:
◦ Smaller power-using factories with 10-19 persons
◦ Non-power factories with 20 or more persons
◦ Shops
◦ Hotels and restaurants
◦ Cinemas including preview theaters
◦ Newspaper establishments
◦ Road motor transport undertakings employing 20 or more persons
◦ State govt may cover other establishments in consultation with the ESI
corporation and with approval of the central govt.
DEFINATION
Employee- Employee refers to any person employed on wages in
connection with the work of a factory or establishment to which
this act applies.
◦Includes technical, manual, clerical and supervisory functions
◦Persons with remuneration upto Rs.6500 are covered under the
act.
◦No distinction between casual and temporary employees or
technical and non-technical, or timerate or piece-rate
◦Covers admin staff and those in purchase
◦Does not include naval, military or air force personnel.
◦Wages: means all remuneration paid in cash, including payment
in period of leave, lockout or strike which is not illegal. Does not
include:
◦Contribution paid to the provident fund or pension fund
◦Travelling allowance
◦Sum paid to defray special expenses
◦Gratuity payable on discharge
Contributions
◦Main sources of finance are contributions from employers and
employees, and 1/8th share of expenses by state governments.
◦Employee’s contribution 1.75% of wages
◦Employer’s contribution 4.75% of total wages
◦Total amount to be deposited in the state bank of India or other
authorised bank by 21st of the month following the month when
the wages became due.
◦Registration
◦Registration of a factory/establishment with the employees state
insurance corporation (ESIC) is a statutory responsibility of the
employer under section 2-A and 10-B.
◦Declaration of registration in form to be furnished to the
appropriate regional office within 15 days of the act becoming
applicable.
◦Employer should get the declaration form filled in by every
employee covered under the scheme.
MAINTENANCE OF REGISTERS

The statutory registers to be maintained up to date are:

◦A) Register of employees
◦B) Accident book in which every accident to employees during
the course of employment is recorded
◦C) Inspection book (to be produced before an inspector or
authorised officer.)
ADMINISTRATION
◦The scheme is administered by the esic (employee’s state
insurance corporation) Chairman: Union minister for labour
◦Comprises groups like employers, employees, parliament, state
and central govt. And the medical profession.
◦A standing committee drawn from this broad based body is
responsible for policy, planning and decision making.
◦The chief executive officer of the corporation is Director general
of esic
◦Ex officio member of the corporation
◦Member of the standing committee Responsible for Formulation of
policy ,Overall supervision ,Co-ordination and liaison with central
and state governments.
◦Esic has set up regional offices all over India. Each office is under
the charge of the regional director who maintains records and
administers local offices.
RESTRICTIONS

◦A person entitled to ESI benefits shall not be entitled to any other

benefit. Further an insured person will not be entitled to receive
for the same period:
◦Both sickness and maternity benefit, or
◦Both sickness and maternity benefit for temporary disablement,
or
◦Both maternity and disablement benefit for temporary
disablement.
◦Where a person is entitled to more than one of the benefits, he
has an option to select any one of them.
 PENALTIES AND DAMAGES
◦ If a person commits an offence after being convicted by a court, every
subsequent offence attracts imprisonment upto 1 year or fine upto rs.2000 or
both.
◦ If the subsequent offence is for failure to pay contribution, punishment will be
upto 1 year and not less than 3 months, and fine upto rs.4000.
◦ Contribution can be recovered through the district collector as arrears of land
revenue.
◦ Employer is liable for 6% interest p.a. For each day of default or delay in
payment of contribution.
◦ Power to levy damages is discretionary and in the nature of a quasi-legal
provision. Reasonable opportunity to the employer to be given before levying
damages.
MISCELLANEOUS

◦Cash benefits payable under the esi act are not liable to
attachment or sale in execution of any court decree or order.
◦Right to receive benefit is not transferable.
◦Disputes under the provisions of the act to be decided by the
employees’ insurance court (eic) and not by a civil court. Appeals
to the high court only by an order of the eic on a question of law.
◦Period of limitation for appeal is 60 days.
OBLIGATIONS OF EMPLOYERS

◦Get his factory registered within 15 days of the act becoming

applicable, by supplying information in prescribed form. Obtain
code number.
◦ Arrange allotment of insurance number to all employees covered
by the act by completing their declaration forms and submitting
them to the regional office.
◦Assist employees in obtaining their identity certificates, and
pending this issue certificates of employment to enable
employees to avail of cash and medical benefits meanwhile.
◦He should not dismiss or punish any employee during period of
medical treatment or if absent from work as a result of illness.
◦ Maintain up to date registers and records of the establishment
and afford facilities for easy inspection.
◦Reimbursement to the corporation excess expenditure incurred
due to insanitary working and living conditions in the
establishment or housing colony of its employees
OBLIGATIONS OF EMPLOYEES

◦Assist employer in obtaining registration, insurance number and

id cards from the esi authorities.
◦Obtain necessary sickness/other certificates from the medical
authorities for claiming cash benefits.
◦Give proper notice to employer of accident causing employment
injury and submit for medical examination as an when necessary
to claim benefits.
◦Repay to the esic any benefit to which he was not entitled.
◦Submit claims within prescribed time along with prescribed
documents.
 RASHTIYA SWASTHIYA BIMA
YOJANA (RSBY)
◦ According to the RSBY as launched in 2008 –
◦ Every BPL family holding a valid ration card may enrol to avail the insurance
benefits as extended by the scheme;
◦ INR 30 will be charged as a one time registration fee;
◦ Upto 5 members of the family including one head of household, spouse and three
dependent persons (children or parents) may be covered under the insurance
scheme;
◦ Each family is entitled to claim (cashless) inpatient medical care up to INR 30,000
per annum;
◦ The hospitalization may be done in any of the empanelled hospitals;
◦ Pre existing ailments will be covered from Day 1 of the enrolment;
◦ Each family may also claim transport expenses of INR 100 per hospitalisation
subject to a maximum of INR 1000 per family per annum.
Aim

◦The premium that has to be paid for this health scheme is jointly
borne by the Union and the State Governments. It is envisioned as
a very strong health scheme that will cover the majority of the
unorganized sector in India. This Scheme is under the overall
control of the Ministry of Health & Family Welfare. The major 2
objectives of this scheme is to provide financial assistance to high
costs in health protection and enhance the accessibility of
standard health care features for the members of the BPL category
of people. The beneficiaries are the people who are under the BPL
category.
Features :

◦ Independence of the beneficiary

◦ Win-win situation for all the stakeholders
◦ Insurance Company
◦ Hospitals/Medical Centers
◦ Intermediary organizations
◦ Government
◦ Digitally enabled
◦ Can be availed anywhere in India
◦ No monetary transactions required.
◦ Error-free tracking
◦Documents Required:
◦The person should be a holder of the BPL card to avail this
scheme. Workers in the unorganized sector also can avail the
scheme. A Government specified list of 11 categories of
unorganized sector is defined. These people have to show the
proof of their occupation. 
Benefits
◦The unroganised sector worker and his family (unit of five) will
be covered.
◦Total sum insured would be Rs. 30,000/- per family per annum on
a family floater basis.
◦Cashless attendance to all covered ailments
◦Hospitalization expenses, taking care of most common illnesses
with as few exclusions as possible
◦All pre-existing diseases to be covered
◦Transportation costs (actual with maximum limit of Rs. 100 per
visit) within an overall limit of Rs. 1000.
Target Beneficiaries
◦ The initial intention of the Rashtriya Swasthya Bima Yojna (RSBY) was to
provide healthcare and financial relief only for those the Below Poverty Line
(BPL). It later evolved, however, to cover other workers and their families not
initially envisaged within the purview of the scheme –
These include –
◦ MNREGA workers who have been employed for over 15 days in the previous
financial year
◦ Domestic helpers and workers
◦ Sanitation workers
◦ Miners and mine workers
◦ Rickshaw pullers and auto and taxi drivers
◦ Street vendors and railway porters
AAM AADMI BIMA YOJANA (AABY)
AND JANASHREE BIMA YOJANA (JBY)
◦ The beneficiary of the AABY scheme has to belong to landless persons in the rural
areas. A single member of the family gets the benefit of this health scheme. The
wage earner of the family is the person who gets the benefit of this scheme. The
person has to be with the age of 18 to 59 to qualify. The premium is paid by the
Centre and the State equally. The coverage is for people under the BPL category or
slightly above the limits for the JBY Scheme. Both these schemes have now been
combined.
BENEFITS OF AAM AADMI
BIMA YOJANA:
◦ The Death Benefit Of this scheme is given to the surviving nominees or family of the
policyholder on the event of a natural death is Rs. 30,000/-.
◦ In case the death has occurred due to accident/on permanent total disability due to
accident (loss of 2 eyes or 2 limbs) the amount given to the nominees or family
members of the owner of the policy is Rs. 75,000.
◦ In the case of partial permanent disability due to accident (loss of one eye or one limb)
the amount given to the nominees or family members of the owner of the policy is Rs.
37500/-
◦ Scholarship benefits: Scholarship is a Free Add-on benefit provided to a maximum of
two children of the beneficiary who are studying between 9th to 12th Standard @
Rs.100/= per month for each child, which is payable at a half yearly basis – July 1 and
on January 1, every year.
ELIGIBILITY CRITERIA FOR AAM AADMI BIMA
YOJANA:

The following are the basic requirements for applying for the Aam
Aadmi Bima Yojana:
◦The applicants should be aged between 18 and 59.
◦The applicant ideally should be the head of the family or one of
the earning members of a below poverty line family (BPL) or
marginally above the poverty line under identified vocational
group/rural landless household.
◦Some documentation is also required.
DOCUMENTATION REQUIRED FOR AAM AADMI
BIMA YOJANA APPLICATION:

The following are the documentation requirements to apply for

this scheme:
◦Ration Card
◦Extract from Birth Register
◦Extract from School Certificate
◦Voter’s List
◦Identity card issued by reputed employer/Government
Department.
◦Unique Identification Card (Aadhar Card)
 Death Claim Procedure:
◦ In the event of death of the member during the period of coverage and while
the policy is in force, an application has to be made by his/her nominee.
◦ This application should be made along with a Death Certificate for payment of
claim amount to the designated official of the Nodal Agency.
◦ The designated official of the particular Nodal Agency has to then verify the
claim papers.
◦ The officer will then submit the documentation and application along with the
death certificate and a certificate that the deceased member was head /earning
member of the family belonging to the BPL/Marginally above BPL family under
the eligible occupations under the scheme.
◦ Nodal Agency has to submit the following with the application:
◦ Claim Form duly completed in all respects
◦ Original death certificate along with a copy duly attested.
Accident Claim Procedure:

In case of accident benefit claim additional requirements have to be

submitted along with the Death Registration Certificate. This includes:
◦ Copy of FIR
◦ Post Mortem Report
◦ Police Inquest Report
◦ Police Conclusion Report / Final Report of Police.
Scholarship Claim
Procedure:
◦ The member of Aam Aadmi Bima Yojana whose child is eligible for this scholarship has to
fill up an application form every half a year and submit it to the Nodal Agency.
◦ The Nodal Agency will have to identify and then verify the students.
◦ The Nodal Agency official then would submit the list of beneficiary students to the
concerned P&GS unit with full details which include:
◦ Name of the student
◦ School’s name
◦ Class
◦ Member’s name
◦ Master policy no.
◦ Membership no.
◦ NEFT details for direct payment.
◦ Each half year, on July 1 and January 1, LIC will credit the scholarship payment to the
Account of the beneficiary student, by NEFT or bank account, if the NEFT facility is
unavailable.
PMJAY -AYUSHMAN BHARAT YOJANA
◦ Prime Minister Narendra Modi rolled out this health insurance scheme on
23 September 2018 to cover about 50 crore citizens in india and already
has several success stories to its credit. As of September 2019, it was
reported that 18,059 hospitals have been empanelled, over 4,406,461 lakh
beneficiaries have been admitted and over 10 crore e-cards have been
issued.
◦ The Ayushman Bharat Yojana - National Health Protection Scheme, which has
now been renamed as Pradhan Mantri Jan Arogya Yojana, plans to make
secondary and tertiary healthcare completely cashless. The PM Jan Arogya
Yojana beneficiaries get an e-card that can be used to avail services at an
empanelled hospital, public or private, anywhere in the country. With it, you
can walk into a hospital and obtain cashless treatment.
◦The coverage includes 3 days of pre-hospitalisation and 15 days of
post-hospitalisation expenses. Moreover, around 1,400 procedures
with all related costs like OT expenses are taken care of. All in all,
PMJAY and the e-card provide a coverage of Rs. 5 lakh per family,
per year, thus helping the economically disadvantaged obtain
easy access to healthcare services.
 ELIGIBILITY CRITERIA FOR RURAL PEOPLE

◦ 1) Those living in scheduled caste and scheduled tribe households

◦ 2) Families with no male member aged 16 to 59 years
◦ 3) Beggars and those surviving on alms
◦ 4) Families with no individuals aged between 16 and 59 years
◦ 5) Families having at least one physically challenged member and no able-bodied adult
member
◦ 6) Landless households who make a living by working as casual manual labourers
◦ 7) Primitive tribal communities
◦ 8) Legally released bonded labourers
◦ 9) Families living in one-room makeshift houses with no proper walls or roof
◦ 10) Manual scavenger families
In the urban areas, those who can
avail of the government-sponsored
scheme consist mainly of:
◦ 1. Washerman / chowkidars
◦ 2. Rag pickers
◦ 3. Mechanics, electricians, repair workers
◦ 4. Domestic help
◦ 5. Sanitation workers, gardeners, sweepers
◦ Home-based artisans or handicraft workers, tailors
◦ 7. Cobblers, hawkers and others providing services by working on streets or pavements
◦ 8. Plumbers, masons, construction workers, porters, welders, painters and security guards
◦ 9. Transport workers like drivers, conductors, helpers, cart or rickshaw pullers
◦ 10. Assistants, peons in small establishments, delivery boys, shopkeepers and waiters
People not entitled for the Health Cover
under Pradhan Mantri Jan Arogya Yojana:

◦1. Those who own a two, three or four-wheeler or a motorised

fishing boat
◦2. Those who own mechanised farming equipment
◦3. Those who have Kisan cards with a credit limit of Rs.50000
◦4. Those employed by the government
◦5. Those who work in government-managed non-agricultural
enterprises
◦6. Those earning a monthly income above Rs.10000
◦7. Those owning refrigerators and landlines
◦8. Those with decent, solidly built houses
◦9. Those owning 5 acres or more of agricultural land
 MEDICAL PACKAGES AND HOSPITALIZATION
PROCESS IN AYUSHMAN BHARAT SCHEME (PMJAY)

◦The Rs. 5 lakh insurance cover provided by the Pradhan

Mantri Jan Arogya scheme can be utilized not just by
individuals in particular, but also by families in general.
This lumpsum is enough to cover both the medical and
surgical treatments in 25 specialities among which are
cardiology, neurosurgery, oncology, paediatrics,
orthopaedics, etc. However, medical and surgical expenses
cannot be reimbursed simultaneously.
Some of the Critical illnesses
that are covered are as follows-
◦ Prostate cancer
◦ Coronary artery bypass grafting
◦ Double valve replacement
◦ Carotid angioplasty with stent
◦ Pulmonary valve replacement
◦ Skull base surgery
◦ Laryngopharyngectomy with gastric pull-up
◦ Anterior spine fixation
◦ Tissue expander for disfigurement following burns
PMJAY has a minimal list of
exclusions. They are as follows.

◦OPD
◦Drug rehabilitation programme
◦Cosmetic related procedures
◦Fertility related procedures
◦Organ transplants
◦Individual diagnostics (for evaluation)