The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the launch of Ayushman Bharat – National Health Protection Mission (AB-NHPM, with budgetary support of Rs160 billion for 2018-19 and 2019-20.
Ayushman Bharat, popularly known as Modicare and tagged as world's largest government funded public health coverage, seeks to provide Rs 5 lakh medical coverage per family per year to 10.74 crore poor and vulnerable families -with no restriction on age and family size per year for secondary and tertiary care hospitalisation- based on Socio Economic and Caste Census (SECC). It also proposes to strengthen the primary healthcare in the country with 150,000 health and wellness centres.
The Scheme was announced by Finance Minister Arun Jaitley on 1 February 2018 and is likely to be launched on August 15 or October 2, according to officials.
Announcing the Cabinet decision, Union Health Minister Jagat Prakash Nadda called it "a visionary step towards advancing the agenda of Universal Health Coverage".
The Cabinet also gave a nod to continuing the National Health Mission (NHM) till 2019-20, for a cost of Rs 852 billion. NHM provides free services to those below the poverty line and will complement the NHPS, said officials.
Proposed to be portable across India, the NHPM is intended to provide health care for at least 40 per cent of the population or 107.4 million households (500 million people). Each family will be entitled to health cover up to Rs 500,000 a year.
"Benefits of the scheme are portable across the country and a beneficiary covered under the scheme will be allowed to take cashless benefits from any public or private empanelled hospitals across the country.To ensure that nobody is left out (especially women, children and elderly) there will be no cap on family size and age in the scheme,''," said the statement.
"The benefit cover will also include pre- and post-hospitalisation expenses. All pre-existing conditions will be covered from day one of the policy. A defined transport allowance per hospitalization will also be paid to the beneficiary," said an official statement.
NHPM will be an entitlement based scheme with entitlement decided on the basis of deprivation criteria in the SECC database, it said.
The scheme will give states the option to adopt insurance company or a trust model as followed under the Central government health insurance scheme. Some states are already having their own insurance models or are running trust-model health schemes.
To control costs, the payments for treatment will be done on package rate basis. The package rates will include all the costs associated with treatment and it will be a cashless transaction for the beneficiaries. States will have the flexibility to modify these rates within a limited bandwidth.
The cabinet approval includes setting up of nodal agencies by states or even a trust to run it. The health minister will head the scheme and take all decisions on policy.
Transfer of funds will be through an escrow account directly, so that funds are transferred in an efficient and timely fashion, went an official statement. Transactions will be paperless and cashless. Private hospitals may also provide treatment under this scheme, once empanelled with the government, it added.
"One of the core principles of AB-NHPM is to co-operative federalism and flexibility to states," said the statement. The states would be allowed to expand AB-NHPM both horizontally and vertically and they can implement through insurance company or Trust/Society or a mixed model.
For giving policy directions and fostering coordination between Centre and states, it is proposed to set up Ayushman Bharat National Health Protection Mission Council (AB-NHPMC) at apex level. Further, an Ayushman Bharat National Health Protection Mission Governing Board (AB-NHPMGB) and an Ayushman Bharat – National Health Protection Mission Agency (AB-NHPMA) would also be set up.
"At the national level to manage, AB-NHPMA would be put in place. States/UTs would be advised to implement the scheme by a dedicated entity called State Health Agency," it said.
The Ayushman Bharat-National Health Protection Mission Agency will be set up in the form of a society and will be headed by a full time CEO. There is a provision to partner states through a co-alliance, which will ensure appropriate integration with the existing health insurance or protection schemes at the Centre and state levels.
State governments will be allowed to expand the scheme both horizontally and vertically. In partnership with NITI Aayog, a robust, modular, scalable and interoperable IT platform will be made operational which will entail a paperless, cashless transaction. This will also help in prevention and detection of any potential misuse, fraud and abuse cases.
The Cabinet noted that out of pocket (OOP) expenditure in India is over 60 per cent, which leads to nearly 6 million families getting into poverty due to catastrophic health expenditures. It said AB-NHPM will have major impact on reduction of OOP expenditure.
"This will lead to timely treatments, improvements in health outcomes, patient satisfaction, improvement in productivity and efficiency, job creation thus leading to improvement in quality of life," it added.
The expenditure incurred in premium payment will be shared between Central and state governments in specified ratio, and the total expenditure will depend on actual market determined premium paid in the states.
"In States/ UTs where the scheme will be implemented in Trust/ Society mode, the central share of funds will be provided based on actual expenditure or premium ceiling (whichever is lower) in the pre-determined ratio," the Cabinet said.
A big challenge is to integrate the central and state schemes. There could be large overlaps and cost ramifications, since SECC data are not seeded with Aadhaar, the citizen identification. There could also be a possibility of exclusion of beneficiaries. So, states would be provided the flexibility to expand their existing schemes till the time SECC data was seeded with Aadhaar, say experts.
Initially, the scheme was estimated to cost Rs 250 billion from both Centre and states for 2018-19 and 2019-20. This assumed Rs 650 per family from the Centre and Rs 432 from the states, including the administrative cost.
Coverage will be based on the Socio Economic Caste Census (SECC), which identifies poor in seven defined categories of deprivation. Some, such as Rajasthan and Gujarat, cover people other than those listed in these categories. The Karnataka government recently announced it would cover all state residents in its health insurance scheme, while West Bengal has decided not to implement NHPS.
The Union health ministry and NITI Aayog had called state health secretaries to apprise them about NHPS. The Centre had earlier thought of an insurance scheme of Rs 100,000 but did not finalise it, as many states already had active schemes for more than that amount. Some states have provided insurance of around Rs 250,000 or even more in some cases.
AB-NHPM, which will subsume the on-going centrally sponsored schemes – Rashtriya Swasthya Bima Yojana (RSBY) and the Senior Citizen Health Insurance Scheme (SCHIS), will take care of almost all secondary care and most of tertiary care procedures.
RSBY’s annual health cover is up to Rs 30,000.
The premium per family could be Rs 1,000-1,200 a year, which, the government expects, to be even lower with an open tender process. The government currently pays a premium of Rs 750 per family per annum for Rashtriya Swasthya Bima Yojana (RSBY). However, insurance companies have reportedly written to the government, citing their inability to bid for the NHPS due to grossly inadequate premiums. They say an annual premium of at least Rs 2,500 per family needs to be considered and states must pay the money to the companies in advance every year.
The government pays a premium of Rs 750 per family per annum for its current health insurance scheme, the RSBY.