Blog

In recent years, the global healthcare landscape has undergone significant transformations. Despite these advancements, a considerable gap remains in healthcare accessibility, particularly for underserved populations.

Financial barriers often prevent individuals from accessing timely and adequate healthcare, exacerbating health disparities. Innovative healthcare payment solutions are emerging as pivotal tools to bridge this gap, expanding access and improving health outcomes on a global scale, with notable progress in countries like India.

The challenge of healthcare accessibility

Healthcare accessibility encompasses the ability of individuals to obtain necessary medical services without financial hardship. However, millions worldwide still struggle to afford essential healthcare due to high out-of-pocket expenses, lack of insurance coverage, and inefficient healthcare systems. This financial burden disproportionately affects low-income families, rural communities, and marginalised groups, leading to delayed treatments, worsening health conditions, and increased mortality rates.

Innovative healthcare payment solutions

Innovative payment solutions are redefining how healthcare services are financed and delivered. These solutions range from micro-insurance and health savings accounts to digital payment platforms and value-based care models. By addressing financial barriers, these innovations are making healthcare more affordable and accessible.

1. Micro-Insurance Programmes: Micro-insurance schemes or “sachet-insurance” products, specifically in healthcare, provide low-cost insurance coverage. These programmes offer protection against significant medical expenses while enabling individuals to seek care without fearing financial ruin.

For instance, using mobile technology, the Kenyan health micro-insurance initiative, M-TIBA, allows users to save, send, and receive funds specifically for healthcare expenses. This model has shown promising results in increasing healthcare utilisation among low-income families.

Imagine an add-on insurance premium for post-surgery complications when you use a healthcare payment app to pay for that surgery. This would be similar to the small add-on charge for baggage insurance you would pay while booking an airline ticket.

2. Health Savings Accounts (HSAs): HSAs allow individuals to save money for medical expenses. These accounts often come with tax benefits, making healthcare savings more attractive. By enabling people to set aside funds for future medical needs, HSAs reduce the immediate financial burden and encourage proactive health management.

Globally, this concept is embedded in an employee’s healthcare compensation. However, in India, this is yet to find any active takers, especially since the medical bill reimbursements were grouped within the overall standard deduction available to an employee.

3. Mobile Payment & Embedded Finance: Mobile payment platforms like Google Pay, PayTM or PhonePe, linked with UPI, have changed how India pays for almost anything. Mobile wallets and online banking have revolutionised healthcare payments globally, especially in regions with limited banking infrastructure.

Innovations of friction-free payment apps, specifically focused on healthcare, that reward every payment while offering embedded medical finance democratise access to care by using capital as a ‘lubricant’ in the transaction equation between the healthcare payor and the healthcare provider.

Such platforms facilitate cashless transactions, reducing the hassle of carrying cash and making payments more convenient and transparent.

4. Value-Based Care Models: Shifting from fee-for-service to value-based care models incentivises healthcare providers to deliver high-quality care rather than high-quantity services. These models focus on patient outcomes and cost-effectiveness, ensuring that financial resources are utilised efficiently. For example, in the United States, the Centers for Medicare & Medicaid Services (CMS) have implemented value-based programs to improve care quality while controlling costs.

Global Impact

The implementation of innovative payment solutions is making a significant impact worldwide. In Africa, Asia, and Latin America, micro-insurance and mobile payment systems are expanding access to healthcare for millions. Countries with large uninsured populations are witnessing improved health outcomes as more individuals receive timely medical care.

In Rwanda, the Mutuelles de Santé programme, a community-based health insurance scheme, covers over 90% of the population. This programme has dramatically increased healthcare access and utilisation, improving maternal and child health outcomes.

Similarly, in Indonesia, the Jaminan Kesehatan Nasional (JKN) program, a national health insurance scheme, has expanded coverage to millions, reducing the financial burden of healthcare expenses.

Case Study: India

India presents a compelling case study of how innovative payment solutions can transform healthcare accessibility. India’s vast and diverse population faces unique healthcare challenges, including high out-of-pocket expenses, limited insurance coverage, and disparities between urban and rural healthcare services.

1. Digital Health Initiatives: India’s digital payment ecosystem has grown rapidly, with platforms like UPI (Unified Payments Interface) facilitating seamless transactions. Integrating digital payments in healthcare has made it easier for patients to pay for services, reducing their dependence on cash, improving transaction transparency, and consolidating different sources of funds—personal savings, credit cards, funds from family, friends, or employer, and quick medical loans—into one ‘payment pipe’. This will be the most significant innovation in healthcare access and payments shortly.

2. Ayushman Bharat Scheme: Launched in 2018, the Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana (PM-JAY) is one of the world’s largest government-funded healthcare programs. It aims to provide health coverage to over 500 million people, focusing on vulnerable and low-income families. The scheme offers cashless and paperless access to healthcare services at both public and private hospitals. By eliminating out-of-pocket expenses for the poor, PM-JAY significantly reduces financial barriers to healthcare.

3. Health Insurance Expansion: The Indian government and private sector are working to expand health insurance coverage. The introduction of affordable health insurance plans targeted at low and middle-income families is helping to mitigate the financial burden of medical expenses. For example, the Rashtriya Swasthya Bima Yojana (RSBY) provides health insurance to families below the poverty line, offering coverage for hospitalisation and other medical services.

Conclusion

Innovative healthcare payment solutions are crucial in bridging the healthcare access gap globally. By addressing financial barriers and making healthcare more affordable, these solutions ensure that more individuals receive timely and adequate care. The progress seen in countries like India demonstrates the potential of these innovations to transform healthcare accessibility, improve health outcomes, and reduce disparities. As these solutions evolve, they promise a future where quality healthcare is within reach for everyone, regardless of their financial circumstances.

(Chris George is the CEO and Founder of QubeHealth)