The roll-out of the Union government’s ambitious new health insurance scheme could face rough patches, as many states, including those with Bharatiya Janata Party (BJP) governments, are reluctant to withdraw their current schemes in its favour.
In the Union Budget, presented in Parliament on February 1, the Union government said it would introduce health insurance for 500 million Indians, called the National Health Protection Scheme — subsequently dubbed “Modicare”. Under this scheme, 100 million vulnerable families would be provided insurance cover of up to Rs 500,000 a year. The states have the option of running it parallel to their own schemes, or merging both, or running only Modicare.
They are, however, not too eager about it.
Even Gujarat, which is Prime Minister Narendra Modi’s home state, is less than enthusiastic. “Our government has no plan of withdrawing or curtailing benefits to those who have been receiving it under the current state government scheme,” Gujarat Deputy Chief Minister Nitin Patel said.
States, which have to provide for 40 per cent of Modicare’s costs, are unwilling to run both schemes together. They believe there would be duplicity of beneficiaries, and they would end up funding both schemes. Beneficiaries of state schemes are also likely to enroll for Modicare because of the higher insurance coverage. Most states provide up to Rs 300,000 per family.
The NITI Aayog is meeting state health secretaries on Thursday to discuss the roll-out of Modicare.
They are also not in favour of merging their schemes with Modicare, as the latter does not have many categories that are part of insurance coverage provided by 24 state governments. For instance, the Centre’s new scheme is only meant for the poor identified under the Socio-economic Caste Census, 2011.
But Gujarat provides benefit to all with an annual income below Rs 250,000, under its Mukhyamantri Amrutam Yojana. Launched in 2012, it also covers reporters and Class-III and -IV employees.
Maharashtra provides benefits to 85 per cent of its population including farmers from fourteen districts; Rajasthan’s Bhamashah health insurance scheme covers people Below Poverty Line and health workers, among others.
West Bengal, which has already opted out of Modicare, provides benefits to workers, self-help groups, police, gram panchayat members, and disaster management teams, among others. Exclusion of these categories can be counterproductive for state governments, especially when the insurance claim ratio is high.
That’s perhaps the reason why poll-bound Karnataka — the last big bastion of the Congress — has announced a universal health coverage for all 14.3 million families that live within its borders, barely a day after Modicare was announced.
“Ours is an assurance model, theirs (Modicare) insurance. In case of assurance, we are duty-bound to honour our commitments. That’s the reason we have also amended the Medical Establishment Act,” said Karnataka Health and Family Welfare Minister K R Ramesh Kumar.
Another hurdle the Modicare roll-out is likely to encounter is the uniformity of the scheme.
Currently, states follow one of the three models — direct reimbursement to beneficiaries; “trust”, where the government concerned appoints a national health insurance company to provide medical coverage; and “awards contract” to an insurer with the lowest bid.
Gujarat directly reimburses the beneficiaries and claims to have honoured all claims it has ever received. Rajasthan and Maharashtra have appointed state insurance companies. Modicare allows states to choose any method they like, but they would have to restart the process of selecting an insurer.
Maharashtra chief minister Devendra Fadnavis, however, is hopeful that Modicare will reduce cost of the states.
“The central scheme will help us increase coverage and bring down costs. We will make both schemes supplementary. Our burden will be shared to a great extent by the central scheme,” Fadnavis said in a text message, responding to queries.
Snapshot of state schemes
Mukhyamantri Amrutam Yojana was launched on September 4, 2012
Scheme covers those with annual income less than Rs 250,000
Also includes: reporters and fix pay employees of class-3 & 4 appointed by state government
Sum assured up to: Rs 200,000
Kalaignar Kappeettu Thittam was launched in 2009
Scheme covers those with annual income up to Rs72,000,
Sum assured up to: Rs 200,000
Swasthya Sathi launched in December 2016
Scheme covers 3.9 million families
Also includes workers and volunteers like the members of self-help groups, civic police, Gram Panchayat, and disaster management team
Sum assured: from Rs 150,000 to Rs 500,000 (in case of critical illness)
Premium per family ranges from Rs 1,729 to Rs 3,549
Aarogya Bhagya to be launched later this month.
The scheme combines all existing healthcare schemes and covers the entire state population
Sum assured: no medical cap on medical expenditure
Rajiv Gandhi Jeevandayee Arogya Yojana was launched in July 2012.
it was changed to Mahatma Jyotiba Phule Jan Arogya Yojana in 2017
Scheme includes 22.3 million ration card holders
Sum assured up to Rs 150,000
Bhamashah Swasthya Bima Yojana launched in December 2015
Schemes covers around 10 million families. It is mainly for people below poverty line
sum assured: Rs 30,000/- for general illnesses and Rs 300,000 for critical illness
Sohini Das from Gujarat, Bibhu Ranjan Mishra from Karnataka, Sahil Makkar from New Delhi, Aneesh Phadnis from Maharashtra, Namrata Acharya from West Bengal, Gireesh Babu from Tamil Nadu, and Dasarath Reddy from Andhra Pradesh contributed to this piece