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Chronic illnesses not only pose significant health risks but also create financial hardships that can be overwhelming for families
Strengthening financial assistance programs and promoting awareness about healthcare financing options can significantly reduce the economic burden of chronic diseases.
In today’s fast-paced, high-stress world, the combination of unhealthy dietary habits, sedentary lifestyles, and environmental pollution has led to a significant rise in chronic diseases. Conditions such as cardiovascular disorders, cancer, diabetes, respiratory illnesses, and neurological disorders are becoming increasingly common, often requiring specialized medical procedures like intraocular lens replacement, hip and knee replacements, neurosurgery, and angioplasty. Densely populated and polluted cities are particularly vulnerable to these health challenges. According to a 2023 study by the World Health Organization (WHO), nearly 74% of all global deaths are attributed to non-communicable diseases (NCDs). Alarmingly, 17 million people die from an NCD before the age of 70, with 86% of these premature deaths occurring in low- and middle-income countries.
The financial burden of long-term care for chronic illnesses is immense, encompassing continuous medical treatments, frequent doctor visits, expensive medications, and specialized care. Over time, these costs add up, placing a heavy strain on individuals, families, and healthcare systems. Dr. Pruthvinath Kancherla, Co-Founder of Affordplan, shares insights on navigating these challenges:
The Burden of Out-of-Pocket Healthcare Expenses
In a country like India, where a significant portion of the population falls under the low- and middle-income bracket, managing healthcare costs can be overwhelming. Despite government initiatives like Ayushman Bharat—the world’s largest publicly funded healthcare scheme, which aims to cover 50 crore people by August 2024 with up to ₹5 lakh per family per year for secondary and tertiary hospitalization—many households still face significant out-of-pocket (OOP) healthcare expenses. According to data from the Union Ministry of Health and Family Welfare, treatment costs accounted for nearly 14% of total household expenditure as of January 2024. India also has one of the highest medical inflation rates in Asia, at 14%.
Adding to the financial strain, a Local Circles study of 39,000 respondents from 302 districts revealed that 43% of people struggled to get their health insurance claims approved. Key reasons included unclear disclosure of policy exclusions, confusing technical jargon, and denial of claims due to pre-existing conditions. As a result, many families resort to borrowing money at high interest rates or selling essential assets to cover medical expenses, which can have devastating long-term financial consequences.
The Need for Comprehensive Financial Planning
The long-term financial implications of chronic illnesses highlight the urgent need for structured financial planning and accessible support systems. One of the most effective solutions is increasing awareness and accessibility of health insurance. Despite its importance, health insurance penetration in India remains low due to misconceptions such as “I won’t get sick” or viewing insurance as an unnecessary expense. Many people hesitate to invest in insurance, questioning why they should pay premiums while they are healthy. Furthermore, policies covering pre-existing conditions often have waiting periods of 2–4 years, discouraging potential buyers.
To mitigate financial risks, better access to tailored healthcare financing solutions is necessary. Health insurance should not only be affordable but also flexible enough to cater to individual and family-specific needs. A well-planned insurance policy that includes coverage for pre-existing conditions can help ensure timely treatment and reduce out-of-pocket expenditures.
Alternative Healthcare Financing Solutions
Beyond traditional insurance, alternative healthcare financing models can help families manage long-term medical expenses more effectively. Some promising solutions include:
Healthcare Payment Platforms
Digital platforms offer structured payment options for medical expenses, allowing patients to pay for doctor visits, medications, and surgeries in installments. Many of these platforms integrate credit access and gamification features to make healthcare expenses more manageable.
Medical Loans
Combining health insurance with medical loans can provide holistic financial support, ensuring that patients do not have to delay essential treatments due to cost concerns.
Community-Based Health Financing (CBHF)
In rural and low-income areas, where insurance penetration is low, CBHF models can be effective. Community members contribute to a shared fund, which can be accessed by those in need, fostering mutual support and financial security.
Governmental Support and Policy Interventions
While government initiatives like the National Health Mission (NHM) and Pradhan Mantri Jan Arogya Yojana (PMJAY) have made strides in improving healthcare affordability, more needs to be done. Expanding coverage, increasing awareness, and streamlining insurance claims processes are crucial to ensuring financial protection for families facing chronic illness.
Multi-dimensional interventions, including governance reforms, enhanced financing mechanisms, workforce improvements, technological advancements, and better service delivery, are essential. Strengthening financial assistance programs and promoting awareness about healthcare financing options can significantly reduce the economic burden of chronic diseases.
Chronic illnesses not only pose significant health risks but also create financial hardships that can be overwhelming for families. Addressing these challenges requires a multifaceted approach, including comprehensive health insurance, alternative financing solutions, and stronger policy interventions. By prioritizing financial planning and accessible healthcare solutions, individuals and families can better navigate the long-term costs associated with chronic diseases, ensuring a healthier and more financially secure future.
