Reform option

Arogya Raksha Yojana Health Insurance, Karnataka

Subject area

Health financing.


Mobilising community participation.
The Yeshasvini health insurance scheme was developed by the Narayana Hrudayala Foundation in association with the State Cooperative Society to provide insurance to the farmers of the State to cover surgical interventions. After implementing the Yeshasvini for more than 18 months, it was decided that it was necessary to increase the insurance cover to include inpatient medical treatment.

Therefore on a pilot basis, a new health insurance scheme was drawn up for one block-Anekal in Karnataka. A trust was formed with Biocon Foundation and Narayana Hrudayalaya Foundation to create the ‘Arogya Raksha Yojana’. The risk is covered by ICICI Lombard General Insurance Company. The Third Party Administrator (TPA) has been selected by ICICI. TTK limited has been contracted for a year to administer the scheme.

The premium for individuals was INR 180, INR 150 for a family of two and INR 120 if four or more members of a family enrolled together. This was done to encourage family enrolments.

ICICI organised enrolment camps where people could walk in with residence proof, pay the annual premium and get their photo-id cards.

Under this scheme, free out patient consultations, discounted diagnostics, cashless surgical treatment for over 1,650 operations and in patient treatment for up to three days is offered at 17 accredited hospitals.

‘BioCare’ pharmacies have also been set up to provide generic medicines at discounted rates. These pharmacies are managed by an NGO- Karuna Trust and stock quality generic drugs from Biocon and other companies.

Other initiatives include involving volunteers to educate the community on preventive health measures. Community education programs are being conducted at the village level where trained resource people do sessions on three broad issues- nutrition, hygiene and preventive care.

Sixty thousand members were enrolled in February 2005 when the scheme began.
Because it is a new scheme, it has not been evaluated.
Cost Arogya Raksha Trust was unable to provide PROD with the marketing costs. ICICI spent approximately INR 3 lakhs on photo-id cards (approx INR 5 each).
Place Anekal block, Bangalore (rural) district, Karnataka since February 2005.
Time to set up It’s much easier to enrol an organised group (such as that done under the Yeshasvini scheme) than to sell to individuals but set up should take approximately six months if you are familiar with the area.
Advantages Increases affordability: The community can now access and avail better health services.
Disadvantages Requires high participation: Schemes with low membership can be financially vulnerable.

Challenges faced: It involves concept selling and retailing (convincing, motivating and persuading people door-to-door) which is very time consuming and difficult.
Prerequisites The existence of a reliable NGO/Trust in the area.
Hospitals and institutions providing good healthcare facilities.
Who needs to
be consulted
Health institutions providing care, a charitable institution or a trust, an insurance company and an institution that can act as a Third Party Administrator.
PROD links   *0
Sustainability In order for such schemes to be self sustaining, large numbers need to be enrolled. Quality of service is the most important issue in ensuring the numbers.
Chances of Replication Variable. Each community has its own set of requirements so no scheme can be replicated entirely. It would have to be modified to suit the medical needs and financial capacity of the population to be served.

This scheme is a pilot and if it is successful, the intention is to replicate it in other parts of the State.
Comments This scheme is totally independent of the government set up.
Documents and Illustrations
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Newspaper clippings:

The Hindu Business Line
“New health insurance scheme for rural dwellers in Karnataka” dated Thursday, Dec 23, 2004

The Hindu
“Three organisations to launch “Arogya Raksha'” dated Thursday, Dec 02, 2004

Deccan Herald
“Take charge of your health, insure it” dated January 11, 2005

The Telegraph
"Novel health cover for the poor" dated January 11, 2005

Narayana Hrudayalaya website:

Biocon website on the Arogya Raksha scheme

Further Information Dr H.Sudarshan,
President, Karuna Trust,
B.R. Hills, Yelandur Taluk
Charamarajanagar District
Karnataka- 571441
Ph: 08227-261565

Ms. Priti Jacob,
Chief Executive Officer, Micro Health Division
Narayana Hrudayalaya Institute of Cardiac Sciences
No-258/A,Bommasandra industrial Area
Anekal Taluk,Bangalore-560099
Ph: 080 7835000 to 18
Submitted by Sara Joseph, Researcher, ECTA, April 2005