Protecting the rural poor and informal sector worker against catastrophic health expenditures and health shocks is a goal most developing countries are struggling to achieve. Poor health and enormous expenses on medical treatment, among other factors, are one of the major causes of poverty in Pakistan and both are closely related. Recent researches show that as much as 65 percent of poor population in Pakistan is suffering from ill health, thus eroding their income and further pushing them down the poverty line.
According to the World Health Organisation (WHO), the out-of-pocket health expenditure in Pakistan stands at 71 per cent __ a heavy burden for the poor, especially for low income family households. WHO also observes that those who can only afford to pay the least usually also get the poorest quality of services. For more than 50% of population living below the poverty line and more than 65% without access to health facilities, it is impossible to pick up the health bill. While at the same time, the fact remains that disease prevalence rate is higher among this group due to malnourishment, lack of sanitation and unsafe drinking water.
To overcome health issues partially, SRSO has worked out the arrangement to provide micro health cover to its community members against a very nominal premium and help them in crucial health emergencies. Micro Health Insurance is available to communities through COs in the targeted Program area of the SRSO.
Micro health insurance (MHI) is a principle feature of the poverty reduction agenda of SRSO. It has also become an important risk management tool for the poor of the country who are hit hard by economic woes. SRSO started MHI services in collaboration with the Adamjee Insurance Company Ltd since October of 2005, covering the cost of hospitalization, accidental injuries, disabilities, and compensation in cases of accidental death,providing MHI to the poorest households (households that fall in the 0-18 category according to the poverty scorecard survey). This insurance service is highly flexible and covers almost all the family members irrespective of family size. The service package includes a ceiling of Rs. 25,000 per person per year for day-care, hospitalization, maternity care, and accidental death and disability (ADD). The accidental death also provides a cover of Rs. 25,000 in ‘funeral charges’ for the bread winner of the family.
SRSO launched a second product, the MHI Credit Policy, in 2007 for existing and prospective credit members. With an annual premium set at Rs. 150, this policy provided a cover of Rs. 15,000. In 2008, a family package was introduced, which provided cover for the entire family including for children below 18 years of age. The cover limit for each family member was Rs. 15,000, with an annual premium set at Rs. 600. This package made the unprecedented step of provided Rs. 7,500 for covering the costs of child birth.
Furthermore, Adamjee Insurance Company introduced a catch card "Sehat Salamat Card",for the insured poor family who can enjoy Rs.15000/- per member in the nearby panel hospitals. All the panel hospitals provide cashless service to the policy holders. The policyholders just need to show their smart card or the insurance receipt issued by SRSO and the CNIC of the patients. No prior investment is required by the target families and they can avail health service for all family members. It is one of the most important and innovative steps towards poverty reduction. In view of the fact that the single largest bill poor families pay is on account of health of the family. Under this scheme, by paying a small amount the community receives a sizable amount for health coverage along with the assurance that they will be provided quality health services. The Micro Health Insurance scheme has been instrumental in benefiting numerous poor families. They have either had complete treatment admitted in the hospitals or have claimed monetary compensations.
MHI is enabling three basic objectives:
Enlisting good hospitals into the programme, where treatment would be provided without charge.
Making it possible for patients to visit any hospital (government or private) in the province for treatment.
Incorporating People Primary Health Initiative’s (PPHI) existing services.