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Published on: Sept. 26, 2020, 11:08 a.m.
Ayushman Bharat is still a work in progress

By Business India Editorial

When it was first launched on September 22, 2018, Ayushman Bharat was supposed to be a game changer for the poor and underprivileged people of India. With its two components, namely the National Health Protection Scheme (NHPS) and 1.5 lakh wellness centres across the country, it was supposed to rejuvenate the nation’s broken down healthcare system. Its target: to benefit 50 crore people which was approximately 40 per cent of the country’s population by the end of 2022, when the scheme would be fully functional. Arogya Manthan 2.0, being held in the middle of this week, may therefore be considered a mid-term assessment of the plan.

According to available information about 12.55 crore people have benefited from the scheme, many of whom needed hospitalization for serious ailments such as heart valve disease, cancer, etc. Thus at the end of two years of the scheme, just about 25 per cent of the target population have derived the promised benefits. Could the number of actual beneficiaries then reach 50 crore by 2022?

If that happened, the conclusion would have to be that the entire target population becomes sick enough to require hospital admission within four years. Since NHPS is basically a health insurance scheme, this would imply a claims ratio of almost 25 per cent – something that no health insurance company can afford. So we can expect the NHPS to develop some of the ills of the Mediclaim policies of earlier years – lame excuses for rejecting claims, inordinate delays on settling the bills of hospitals that offer cashless insurance, etc.

Other statistical studies in various countries show that the frequency of any medical condition in a given population is 3-5 per cent. This may vary somewhat from one geographical area to another, from year to year and from one disease to another. A sudden rise in a particular disease in a specific area would be designated as an “outbreak.” But if none of these prevail, the frequency of 12.5 per cent people in a country being afflicted with serious illnesses is definitely a point to ponder.

So what is going wrong? First, there is little point in offering hospital care without an accompanying thrust in primary care. One reason why people seek hospitalization is that they are compelled to postpone their healthcare needs until it becomes unavoidable. By then, the illness too has turned serious enough. Unfortunately, sufficient progress is not visible in the Wellness component of Ayushman Bharat.

Second, the original scheme stated that eligibility would be determined by the Census date of 2011. Thus all the children below nine years of age, and all those who might have retired from service without a pension after 2011 are excluded from NHPS. Given that approximately 67,000 babies are born in India each day, the total number born after 2011 works out to about 22 crore, that is one sixth of the current population of the country! And then there are the retired people, whose numbers are also growing rapidly. Not to mention the fact that small children and elderly people are most vulnerable to any disease.

Third, there were virulent disputes between the package rates for common ailments offered by the NHPS and the actual costs worked out by major healthcare industry bodies. As a consequence a number of private hospitals have refused to join the scheme and as we all know, the public sector facilities are hardly adequate to implement the NHPS in its entirety. One might argue with merit that most of the protesting hospitals are five-star institutions whose overhead expenses are higher than average.

On the other hand, more than 90 per cent of the patients seeking relief under NHPS suffer from routine medical conditions that do not require highly sophisticated, tertiary medical care. There is a large category of secondary care hospitals that are quite capable of catering to most of the NHPS patients.

Finally, most states have opted for the ‘trust’ model, instead of the insurance model. This means the pool of insured people across whom the insurance company ‘spreads its risk’ is markedly reduced. Hence the insurance companies would find the NHPS premium rates unviable. 

Thus even by the most lenient assessment, Ayushman Bharat is at best a Work in Progress, a long distance away from being fully effective and functioning. 

 

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