MUMBAI: Cardiac surgeon Dr Devi Shetty’s Narayana Health group has sought a license from Irdai for a health insurance business.
The group has set up Narayana One Health, and roped in insurance industry veteran Ravi Vishwanath to lead it. Vishwanath was earlier in charge of health and accident businesses at HDFC Ergo.
Dr Shetty’s model aims to offer affordable coverage by reducing the cost of treatment in hospitals through economies of scale, sources said. Dr Shetty (70), who received the Padma Bhushan in 2012 for his contribution to affordable healthcare, has advocated for insurance coverage where contributions of many would cover costs of the few who need treatment.
Narayana Health currently offers healthcare plans from a provider’s standpoint. However, provider-led coverage is restricted to the footprint of the healthcare provider. Health insurance will enable comprehensive coverage without any limitations in terms of provider or geographic area.
“It would be a boon for the industry if the model of affordable health coverage through cheaper healthcare takes off,” said the CEO of a private health insurer. He added that medical inflation tends to be higher than general inflation due to frequent upgrades in medical technology. Additionally, even as health insurance increases demand for healthcare services, capacity creation takes time to catch up.
Dr Shetty, who gained prominence for performing the country’s first neonatal heart surgery and being Mother Teresa’s physician, founded Narayana Hrudayalaya in Bengaluru in 2001. In 2009, the US media dubbed him the ‘Henry Ford’ of heart surgery for his approach to achieving economies of scale in healthcare to reduce costs.
Health insurance in the country continues to be dominated by hospitalisation coverage. The standalone health insurance business in India is less than two decades old. Currently, there are five standalone health insurance companies in the country. Most operate on the principle of enrolling hospitals into a network to provide cashless claims service.