IIPM MANAGEMENT INSTITUTE
If poor insurance base is the area of concern in India, then developed countries are reeling under high health costs. USA has an annual health spend averaging $2 trillion; yet expensive health cover is playing havoc on citizens. According to NCHC, insurance premiums skyrocketted by 7.7% two years ago, making it difficult for a normal citizen to avail health benefits. When premiums rise two times faster than the prevailing inflation, then sustainability becomes an issue. European countries spend close to 10% of their GDP on healthcare, yet citizens have to sometimes shell out more money to stay medically insured. There is a higher rate of bankruptcy in the West due to high insurance premiums than anywhere else. Interestingly, even though developed countries boost of a high human development indexes, citizens are consuming lesser in order to save & pay for medical insurances. This tendency has significant repercussions on these economies as lower demand leads to lower production and so on. It costs $12000 annually for a person to stay insured in the US, in India it takes a little over a $100!
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Source : IIPM Editorial, 2007
An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative