Government to launch Ayushman Bharat with public hospitals only, initially
Insurance companies are hoping to play a larger role in the health insurance scheme from 2019 onwards. Due to the proposed low rates, private hospitals have been reluctant to join
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M Saraswathy & Viswanath Pilla
Moneycontrol News
The government-sponsored health insurance scheme called Pradhan Mantri Jan Arogya Yojana Abhiyan, (Ayushman Bharat) will proceed with public hospitals on board. Sources told Moneycontrol that since private hospitals have been reluctant to join the scheme, the government will proceed with only the government hospitals to start with.
“It is a misconception that only private hospitals have good facilities. The government also provide quality healthcare services,” a senior government official said. The scheme will be launched on September 25, which is the birth anniversary of Bharatiya Jana Sangh founder Deendayal Upadhyay.
It is anticipated that in the first year of its implementation, a total cost of Rs 20,000 crore will be incurred, of which Rs 12,000 crore will come from the Centre and the rest Rs 8,000 crore will be borne by the States.
Under the scheme, also referred to as Modicare, about 100 million families (500 million people) will get access to Rs 5 lakh health insurance completely free of cost. This will include families from lower income groups as per the socio-economic caste census (SECC) 2011 data.
The prices quoted in the model tender document for the medical procedures has been a bone of contention between the government and private hospitals. These hospitals have sought an increase in the package rates for the procedures and have stated that the proposed rates are un-viable.
In the first phase, only about 40-45 percent of the 500 million individuals will be covered under the scheme. Most of the states have opted for the trust route which means that the individual state will set up a trust to manage the claim payout. Only a handful of states like Chattisgarh, West Bengal, Nagaland and Gujarat have opted for the insurance model.
Dharminder Nagar, MD, Paras Healthcare said that while the launch of the scheme is highly welcome, what is also needed to be addressed on a parallel track is accessibility to doctors and hospitals.
“Without improving our doctor-patient ratio, without increasing penetration of hospitals and tertiary care centres, without ensuring that all health centres in rural areas are equipped with specialists and diagnostic facilities, even this ambitious scheme will only partially serve thw purpose,” he added.
For states like Nagaland and Gujarat, which have chosen the insurance model, the premiums quoted by insurers have been less than Rs 450 per annum per family. A few insurers have also expressed discontent on fierce competition between insurers on the premiums being quoted.
Prime Minister Narendra Modi in his Independence Day speech on Wednesday said that over the four to six weeks, the technology for Ayushman Bharat will be tested across the country to make it fool-proof. He also added that new hospitals will be constructed in Tier-2 and 3 cities.
Dr. Nandakumar Jairam, CEO, Chairman & Group Medical Director-Columbia Asia Hospitals India said that the government seems to be taking careful measures in testing the programme to ensure it works effectively after being rolled out on September 25.
“While these measures should boost healthcare infrastructure in rural areas, Tier 2 and Tier 3 cities and will provide employment opportunities, a conducive environment is needed in these regions for high-costing quality tertiary care to be delivered on a sustainable basis,” said Jairam.
In the second phase, as announced by PM Modi, the scheme will be extended to the middle class and the upper middle class as well.
“The prime minister indicated that the scheme will be extended to individuals beyond the lower income group. However, it is unlikely that it will be fully subsidised for them and the insured could be required to pay a portion of the premium,” a senior insurance executive added.
While premiums as low as Rs 360 per annum per family have been quoted, the actual cost incurred per family is estimated to be around Rs 1,200 to 1,400 per family.
Though most states have decided to not engage insurance companies for the scheme, insurers are of the belief that they will get them on board from next year onwards.
“This is the first year and as the volumes build up for the insurance policies, individual states may find it challenging to handle the quantity of the claims,” added the chief of a state-owned insurance company.
Original Source: https://www.moneycontrol.com/news/business/economy/government-to-launch-ayushman-bharat-with-public-hospitals-only-initially-2848261.html