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Pradhan Mantri Jan Arogya Yojana- Ayushman Bharat

Author: Sanand Kumar | February 18, 2018

National Health Protection Scheme

The Government of India in its budget of 2018-19 has announced the new demand side health financing scheme 'AB-PMJAY' which is also called as ‘ModiCare’. The scheme envisages providing Rs. 5 lakh Health Insurance Coverage to a family on floater basis per year. It is planned to enrol/cover 10 Crore households/50 Crore Population of the country who belongs to Below Poverty Line and other vulnerable section of the society. The scheme has been renamed as Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) recently from Pradhan Mantri Rashtriya Swasthya Suraksha Mission - PMRSSM.

Extent of Coverage

The scheme aims to provide secondary and tertiary care treatment to the beneficiaries. Only defined list of procedures/treatment will be provided by empanelled hospitals. However, there is no mention of coverage of OPD under the scheme.

The Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) is revamping of the existing scheme Rashtriya Swasthya Bima Yojna which was launched in 2008 by UPA government. The RSBY was providing secondary care treatment (More than 1500 procedures) to the eligible beneficiaries up to sum insured Rs. 30, 000 per family per year on floater basis. Since the sum insured is increased to Rs. 5 lakh and the rate list of RSBY were very low and not much clear the NHPS may come with revised procedure list along with tertiary procedures.

Eligible Beneficiaries

The vulnerable and deprived families who are identified under Social Economic & Caste Census data of 2011 and also families who were enrolled under RSBY up to 31.03.2018 are eligible to get the golden card under the scheme. More than 10 unorganised sector workers category viz workers of MNREGA, Rag Pickers, Weavers, Domestic Workers, Auto Rikshaw & Taxi Drivers etc are covered in urban areas.

Budget Estimated

The estimated premium under NHPM per family by the government falls between Rs. 1000-Rs.1200. Covering 10 crore families will need around Rs. 10 thousand crores to Rs. 12 thousand crores annually. However, ideally since the assured amount is Rs. 5 lakh per family per annum the estimated premium may shoot up above Rs. 2000. The premium may stand approximately between Rs. 1800 to 2500 per family per annum (This is just an estimation based on other scheme premium). Hence, the total budget needed would be around Rs. 20 thousand crore annually assuming all the 10 crore families are enrolled and having access to healthcare. So the central share at the rate of 60% and 90% for hilly states will around Rs. 12-15 thousand crores annually and rest has to be borne by the State Governments. However, again it depends on the package rate list.

In the first financial year of the roll out of the scheme less funds will be required since practically it is not possible to identify and enrol all the eligible beneficiaries under the scheme. Therefore, only 50% of the estimated funds are required.

Is PMJAY implemented in Trust mode or Insurance Mode?

The RSBY was designed to be implemented in Insurance mode only. Where the scheme was out sourced to Insurance Companies, the Insurance companies were being selected based on the bid selection. However, many states implementing their own scheme on assurance mode where a separate body is created to manage the whole scheme viz. Rajiv Arogyashree of Andhra Pradesh, Vajapeyee Arogyashree of Karnataka, Universal Health Protection scheme of Himachal Pradesh. Under Trust Mode, the separately constituted organisation will manage scheme from end to end viz. Enrolment, Empanelment, Claims process, Claims settlement etc.

Considering above options centre may provide option to the states to opt for Trust Mode or Insurance Mode. However, both the models have their own strengths and weaknesses. The states must carefully address these pitfalls before rolling out this world largest publicly funded health insurance scheme.

Will PMJAY is panacea to all existing problems?

The Pradhan Mantri Jan Arogya Yojana would be first step towards achieving universal health coverage in India. However, the PMJAY in the long run may escalate healthcare cost of the country if not right measures are taken. The huge sum insured, gives the promise to the private sector to facilitate treatment under the scheme. The scheme requires stringent monitoring system in place and carefully chosen evidence based package rates otherwise will end up in ballooning of the cost due to supplier induced demand.

At present, 70-80% of the care is provided by the private health sector in the country. The PMJAY may further give more opportunity for the expansion of private hospitals and increase the dependency of the government on private.

The PMJAY may help reduce out of pocket expenditure on the catastrophic illness but not addressing outpatient treatment which is the major source of economic burden. The PMJAY should envision strengthening of primary care and inclusion of outpatient treatment also.

The Government should focus on strengthening of the government health facilities over the period of time and cut down the expenditure on purchasing healthcare from private sector. The current public infrastructure is neither offering quality nor accessibility.

However, the first step of the government to increase the healthcare expenditure is much appreciated and new policy may come up with robust IT and strategies which may be step toward means to an end.