Putting A Price On Health

Modi’s ambitious health insurance scheme may be a non-starter with private hospitals finding treatment rates unviable and several states reluctant to enlist

- Asit Jolly and Shubham Shankhdhar

When Naresh Chandra first heard about the Narendra Modi government’s ambitious plan to roll out the Ayushman Bharat National Health Protection Mission—touted as the world’s biggest health insurance scheme—it sounded like the answer to his prayers. The 62-year-old Bareilly resident hasn’t been able to walk for some months now. He needs knee replacement surgery immediately, but he’s way down in the long queue of patients in government hospitals. Chandra cannot afford the surgery in a private hospital.

The World Bank says rising expenditure on private healthcare is keeping millions of Indians in poverty. State-run health services have not kept pace with the population. Sixty percent of the 60,000-70,000 public/ private hospitals in the country have less than 30 beds and only some 3,000 of them have 100 or more beds. India has just two million hospital beds, which is merely one per 625 people.

The Ayushman Bharat scheme rather loftily promises to bridge this gap by ensuring healthcare for 100 million of India’s poorest families. The Union health ministry claims the scheme has been drafted after studying health schemes being run in states and by the Centre. Funded by the central and state governments on a 60:40 ratio (Jammu and Kashmir, northeastern and other hill states and Delhi will contribute 90 percent), the scheme aims to provide a Rs 5 lakh health insurance cover free of cost to an estimated 500 million people.

Some 150,000 health and wellness centres are envisaged, on a budgetary outlay of Rs 1,200 crore, to cater to minor ailments. The insurance will cover in-patient costs for 1,350 diseases and medical procedures, including medicine expenses. Both private and state-run hospitals are expected to participate, with the money earned by government hospitals being used to strengthen their infrastructure.