3.6 Other financing

The government emphasis on health and well-being can also influence the promotion strategies of the insurance industry.

3.5.5 Public regulation of VHI The insurance industry is bound by the Regulations of Insurance Industry Act No. 43 of 2000. The Insurance Act has vested the Insurance Board of Sri Lanka (IBSL) with the authority to regulate the for-profit and not-for-profit insurance firms (Withanachchi, 2009).

Regulation of private health care comes under the purview of the MoH but the regulation of VHI schemes, which has the potential to improve access to the private health sector by higher-income groups, has not been addressed. Considering the increase in purchasing power of the higher-income group and even the middle-income group, the regulation of the industry and pricing policies can contribute to reducing OOPE and improving health financing.

The Insurance Industry Act requires insurers to collect and provide basic statistics on the operation of their schemes and make this information publicly available.

3.6 Other financing

3.6.1 Parallel health systems The defence ministry and police departments have established their own health services, including tertiary-care hospitals. However, their employees can access government services as well. The Defence Ministry Scheme (Armed Forces and Police Hospitals) accounted for 0.4% of CHE in 2016 (SLR 284 million at current prices).

Estate health services originated as a parallel health system, which is now being absorbed gradually into the national health services.

Traditional medicine systems, including for both ambulatory and inpatient services have been in existence for longer than the allopathic services. They receive a separate government allocation. Government health expenditure for this system accounts for less than 1% of CHE (2017). The utilization of traditional medicine is limited when compared to services provided by the allopathic system. There are specific illnesses, usually of a chronic nature, for which traditional medicine is sought after most often by the population.