ICRIER
Impact of Preventive Health
Care on Indian Industry and
Economy
Dr. Alka Chadha
National University of Singapore
September 12, 2007
New Delhi
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Preventive health care
Today’s sedentary lifestyle of corporate employees invariably
leads to long-term damage to health.
Knowledge-based economies rely on intellectual capital which
is critically dependent on the quality and health of employees.
Preventive health care for employees is the need of the hour
for the corporates to remain competitive.
The first ever survey done in India to understand and
generate awareness regarding preventive health care
measures in the corporate sector.
Preventive health care is about the individual and refers to
health check-ups and lifestyle changes.
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Relationship between disease and
economic growth
Disease
Absenteeism, early retirement,
morbidity and mortality
Lower labour
productivity
Higher
dependency ratio
Shorter lifespan and rise in the
rate of time preference
Higher consumption and lower
rates of savings and investments
Lower national income and stagnant growth
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Survey methodology
Preventive health care providers were contacted to
share their experience of providing health checkups.
The first phase of the survey was carried out for
private companies from March to June 2007 with 81
respondents.
The next phase of the survey was targeted at
individual employees for one working week with 288
responses.
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Preventive health care providers
Apollo Hospitals Group emphasized the need for
regular check-ups since a disease can develop at
any stage in life.
K.G. Hospital said a health check-up is like an
“annual maintenance certificate”.
Jaslok Hospital said preventive health care is
required to reduce not just absenteeism but also
“presenteeism”.
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Preventive health care measures
offered by companies
42
Preventive health checkups
26
Regular health screening
14
Facilities for exercising
25
Stress-relieving techniques
26
Lifestyle-related advise
12
Other
6
All of the above
16
None of the above
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Mandays lost owing to sickness
More than 51
24%
31-50
11%
0-10
42%
11-30
23%
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Major afflictions according to
management grades
12
Acute diseases
Chronic infectious
diseases
1
3
25
6
Lifestyle diseases
Other
24
17
8
8
Senior-Level
22
26
10
Medium-Level
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Blue-collared workers
8
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Does preventive health care
increase profitability of a company
Yes
82%
Not applicable
1%
Not sure
14%
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No
3%
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Employee survey
40% of respondents belonged to the manufacturing
sector.
56% of respondents had undergone a preventive
health check-up at some point.
Interestingly, the same percentage of responding
employees were white-collared, among whom there
is greater awareness and practice of preventive
healthcare as compared to blue-collared workers.
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Benefits accruing to employees
from preventive health care
Better quality of life
with peace and
happiness 20%
Lesser expenses on
curative care 4%
Reduced loss of
working days 10%
All benefits
64%
No benefits
2%
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Should employers provide vouchers
for preventive health care?
Yes
91%
No
9%
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What employers feel about
vouchers as a delivery system
No
11%
Not sure
18%
Yes
50%
Not applicable
8%
Other
13%
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International comparisons
Country
Per capita
total health
expenditure
($)
Per capita
govt. health
expenditure
($)
Share of
private health
expenditure
in total health
expenditure
(%)
Share of outof-pocket
expenditure
in private
health
expenditure
(%)
Share of
private
prepaid plans
in private
health
expenditure
(%)
Brazil
212
96
54.7
64.2
35.8
China
61
22
63.8
87.6
5.8
India
27
7
75.2
97
0.9
S. Korea
705
348
50.6
82.8
4.1
Thailand
76
47
38.4
74.8
14.6
Canada
2669
1866
30.1
49.6
42.3
France
2981
2273
23.7
42.2
53.5
Japan
2662
2158
19
90.1
1.7
U.K.
2428
2081
14.3
76.7
23.3
U.S.A.
5711
2548
55.4
24.3
65.9
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Demographic dividend
India is enjoying the competitive advantage of a
young, English-speaking workforce while developed
countries are facing the problem of ageing and
rising health care costs owing to insurance charges.
Companies have to ensure that the labour force
remains efficient and productive.
Thus, the need for preventive health care.
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Policy recommendations for the
private sector
Conduct health audit of all employees at regular
intervals through check-ups.
Follow-up with treatment and counselling.
Organize awareness camps.
Encourage employees to adopt a more healthy and
preventive lifestyle.
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Policy recommendations for the
government
Section 17 of the Income Tax Act provides exemption for medical
expenses up to Rs.15,000 for employees. This should be amended
to include the whole range of preventive health care measures.
Income Tax exemption under Section 80D of the Income Tax Law is
provided for health insurance and medical treatment. Provision for a
similar exemption should be made for preventive health care
measures.
The government should provide fiscal incentives, like corporate tax
breaks, to those employers offering preventive health care facilities
to their employees.
We recommend preventive health vouchers as a service delivery
system.
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