How Health Financing Can Help The Migrant Workers In The Current Times
The COVID-19 crisis and the resultant economic shutdown has created unprecedented challenges for migrant workers in India who have been hit the hardest. Recently announced relief measures by the Hon’ble Finance Minister are a step in the right direction towards improving livelihoods for the informal sector/urban poor migrants. Centre for Monitoring Indian Economy (CMIE) estimates that over 122 million people in India lost their jobs in April 2020 and around 75% of them were small traders (MSME) and daily wage-labourers. Historically, under-reporting of employment figures has been made possible by weak labour laws that preclude transparency and accountability towards workers in the informal sector. These relief measures from the government and proposed changes to law show that policy attention has begun to shift to migrant workers’ exclusion from welfare schemes in terms of food, housing and employment security. There is now an urgent need for a similar shift in policy focus from universalisation of minimum wages to Universal Health Coverage and institutional capacity towards health security schemes for the migrant workers and urban poor. Without swift and decisive action to address this crisis unemployment, socio-economic and health access inequity in our societies will rise.
Migrant workers constitute a large part of the informal sector which employs close to 93% of workers in India 1 and contributes nearly 50% of economic output 2 . They lack safe working or living conditions, face forced labour, gender-based discrimination and barely subsist on average INR 500 per day. 90% of health expenditure is out of pocket, (OopE) which has severe long-term consequences for health and earnings. For perspective, less than 20 million informal sector workers are registered under employee state insurance schemes.
To begin with, it is essential to expand coverage in social health insurance schemes to informal sector workers. Coverage mechanisms should be devised with attractive bundled offerings and benefit packages using targeted pull marketing strategies. Strong compliance measures and portability of schemes is crucial as is support from the larger network of public and private health facilities with adequate availability of health diagnostics and drugs, amongst others. For example, Thailand's Universal Coverage Scheme was able to significantly improve compliance and bring own OoPE to 12%. One Nation One Ration Card can serve as a platform for health benefit registrations and portability.
Alternative financing solutions can effectively complement health insurance schemes. With government national mission on financial inclusion and digital payments there are promising alternatives in health savings account, working capital facilities with inbuilt insurance coverage and health loan accounts for vulnerable communities. For instance recently announced credit access to street vendors, digital payment rewards can be linked to promote innovative health financing solutions that can improve access and affordability.
Achieving the goal of UHC also requires rethinking the role of the private sector, given its ability to provide access to quality care at affordable costs in ways that go beyond replicating traditional health financing models. A new age of social entrepreneurs is responding to this challenge with bottom-up innovations, market-based solutions and sound business models achieving social impact. India is fast becoming a preferred destination for impact investing, an investment class that can significantly contribute towards its Sustainable Development Goals. If nurtured as an asset class, it can assist the government to unlock new pools of capital and deploy financing tools that can drive efficiency in social schemes and unleash the power of social enterprise in India. India has the potential to be a global leader with low cost innovations that can serve not only it’s people but create solutions for nearly 3 billion underserved population in the world.
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