AY USHMA N BHAR AT - PR AD HA N MANTR I JAN A R O GY A Y OJANA
Why in news?
Prime Minister on 23rd September, 2018 launched the world’s largest state funded health insurance scheme,
Pradhan Mantri Jan Arogya Yojana (PMJAY), at Ranchi, Jharkhand.
Background
In the General Budget 2018-19, the Government announced a major initiative in health sector- Ayushman Bharat programme aimed at making path breaking interventions to address health holistically, in primary, secondary and tertiary care systems, covering both prevention and health promotion. Ayushman Bharat has 2 components-
• Health and Wellness Centre: As envisioned in The National Health Policy, 2017, 1.5 lakh centres will provide comprehensive health care, including for non-communicable diseases and maternal and child health services. These centres will also provide free essential drugs and diagnostic services.
• National Health Protection Scheme: cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries) providing coverage upto 5 lakh rupees per family per year for secondary and tertiary care hospitalization. Pradhan Mantri Jan Arogya Yojana is launched as this component.
Features of the Scheme
• Beneficiary Identification: PMJAY primarily targets the poor, deprived rural families and identified occupational category of urban workers’ families, 8.03 crore in rural and 2.33 crore in urban areas as per the latest Socio-Economic Caste Census (SECC) data for both rural and urban areas as well as the active families
78 www.visionias.in ©Vision IAS
under the Rashtriya Swasthya Bima Yojana (RSBY). There is no cap on family size and age as well as restriction on pre-existing conditions.
• Hospitalization cover from inpatient care to post hospitalization care: The Yojana will provide a coverage up to Rs. 5,00,000 per family per year, for secondary and tertiary care hospitalization through a network of Empanelled Health Care Providers (EHCP). The services will include 1350 procedures covering pre and post hospitalization, diagnostics, medicines etc.
• Universality: One unique feature of the PMJAY is its national portability once fully operational. The beneficiaries will be able to move across borders and
71st Round of National Sample Survey Organization
(NSSO) has found
• 85.9% of rural households and 82% of urban households have no access to healthcare insurance/assurance.
• More than 17% of Indian population spend at least 10% of household budgets for health services.
• Catastrophic healthcare related expenditure pushes families into debt, with more than 24% households in rural India and 18% population in urban area have met their healthcare expenses through some sort of borrowings.
access services across the country through the provider network seamlessly. The beneficiaries will not need a special card. Their Aadhaar numbers will suffice.
• Implementation agency: The National Health Agency (NHA) will provide overall vision and stewardship for design, roll-out, implementation and management of Pradhan Mantri Jan Arogya Yojana (PM -JAY) in alliance with state governments.
• Alliance with the States: The Scheme is principle based rather than rule based -
o It allows enough flexibility to states in terms of packages, procedures, scheme design, entitlements as well as other guidelines while ensuring that key benefits of portability and fraud detection are ensured at a national level.
o The States will have the option of implementing this scheme through a Trust model or Insurance Company based model, though the Trust model will be preferred.
o States have the option to use an existing Trust/Society or set up a new Trust/Society to implement the
Scheme as State Health Agency and will be free to choose the modalities for implementation.
o Centre’s contribution being 60 per cent and the states’ 40 per cent.
o 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 Chaired by
Union Health and Family Welfare Minister.
• IT based: In partnership with NITI Aayog, a robust, modular, scalable and interoperable IT platform will be made operational which will entail a paperless, cashless transaction.
• Fraud detection and Data privacy: NHA Information Security Policy & Data Privacy Policy are being institutionalized to provide adequate guidance and set of controls on the secure handling of Beneficiaries Personal Data & Sensitive Personal Data in compliance with all laws and regulations applicable.\
• Pradhan Mantri Aarogya Mitra (PMAM): The scheme is creating a cadre of certified frontline health service professionals called Pradhan Mantri Aarogya Mitras (PMAMs) who will be primary point of facilitation for the beneficiaries to avail treatment at the hospital and thus, act as a support system to streamline health service delivery.
Significance of the PMJAY
• Road to universal health coverage: According to NITI Aayog, the scheme would increase the public spending on health to around 4 per cent from approximately 1 per cent at present, thereby, dramatically improving provision of healthcare for the poor.
• Catalyst for transformation: It will be an enabler of quality, affordability and accountability in the health system.
o The empaneled hospitals have been tasked to follow the treatment guidelines. Patient outcomes will be monitored.
o Another impact of the PMJAY will be rationalisation of the cost of care in the private sector. With an increase in demand created, it is expected that private sector will move from a low volume-high return
paradigm to a high volume-fair return (and higher net profit) model.
• The earnings of public hospitals under PMJAY will be available for their upgradation and also for incentivising the provider teams as these funds will be deposited with the Rogi Kalyan Samitis. Up to 30 per cent of the overall public spending on the scheme may return to public sector institutions.
79 www.visionias.in ©Vision IAS
• Poverty-reducing measure: Each year, six to seven crore people, above the poverty line, fall below it because of health-related expenses. PMJAY would reduce this number significantly. More than a third of the out-of- pocket expenditure (around Rs 5,000 per household) is due to inpatient hospitalisations. One out of eight families have to incur health expenditure of more than 25 per cent of the usual household expenditure each year. PMJAY will ease this burden on the poor.
• Employment Creation: The scheme will create lakhs of jobs for professionals and non-professionals —
especially women. It will give a boost to the health technology industry.
• NHPM will subsume the on-going centrally sponsored scheme “Rashtriya Swasthya Bima Yojana” (RSBY) and
Senior Citizen Health Insurance Scheme (SCHIS).
Concerns ahead
• NITI Ayog estimates Rs 12,000 crore will be required to run the scheme. However, allocation of just ₹2,050 crore during the current year to the PMJAY cannot provide the promised cover to the large population sought to be included. Not all States and Union Territories are in a position to raise their own share, and a few have not even joined the scheme. The challenge of funding, therefore, remains.
• Health is a state subject under Indian constitution. State governments should regulate the hospital sector under the Clinical Establishments (Registration and Regulation) Act. The law broadly provides for standardisation of facilities and reasonable rates for procedures. Costs are a contested area between the care- providers and the Centre, and many for-profit hospitals see the government’s proposals as unviable.
• Union government scheme covers only the deprived beneficiaries as per the caste census, thus bringing down the number of people to be covered. But many schemes implemented by states have a wider range of beneficiaries. For instance, Karnataka’s health insurance scheme covers all the residents of the state. This leads states hesitating adopting PMJAY.
• Sustainability of insurance companies has to be ensured. According to the Insurance Regulatory and Development Authority of India’s data on incurred claims ratio (premium earned versus pay outs) for government-sponsored health schemes, it went up from 87 per cent in 2012-13 to 122 per cent in 2016-17. In case of PMJAY, the government has set a premium of Rs 1,050. Insurance companies find this amount very low to provide coverage. This would be more of an issue in states like Kerala where claims ratio is quite high.
• Though hospital care is a big expenditure, it is still a very small percentage of people’s Out of Pocket (OoP) expenses on healthcare. People spend much more on illnesses that don’t need hospitalisation and are not covered under insurance. NSSO 2014 round shows there was no relief from increasing health expenditure w.r.t
2004.
• Along with Insurance model focus must be on strengthening the country’s health infrastructure. It would have a long-term impact. Globally, countries with adequate public health facilities have been successful in implementing health insurance schemes. e.g. Thailand, extensively focused on strengthening the public health infrastructure before rolling out its Universal Coverage Scheme in 2001.
Conclusion: The “best health care at the lowest possible cost” should be: inclusive; make health-care providers accountable for cost and quality; achieve a reduction in disease burden, and eliminate catastrophic health expenditures for the consumer. Ayushman Bharat – Pradhan Mantri Jan AarogyaYojana (AB-PMJAY) is a paradigm shift from sectorial, segmented and fragmented approach of service delivery through various national and State schemes to a bigger, more comprehensive and better converged and need based service delivery of secondary and tertiary care.
Why in news?
Prime Minister on 23rd September, 2018 launched the world’s largest state funded health insurance scheme,
Pradhan Mantri Jan Arogya Yojana (PMJAY), at Ranchi, Jharkhand.
Background
In the General Budget 2018-19, the Government announced a major initiative in health sector- Ayushman Bharat programme aimed at making path breaking interventions to address health holistically, in primary, secondary and tertiary care systems, covering both prevention and health promotion. Ayushman Bharat has 2 components-
• Health and Wellness Centre: As envisioned in The National Health Policy, 2017, 1.5 lakh centres will provide comprehensive health care, including for non-communicable diseases and maternal and child health services. These centres will also provide free essential drugs and diagnostic services.
• National Health Protection Scheme: cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries) providing coverage upto 5 lakh rupees per family per year for secondary and tertiary care hospitalization. Pradhan Mantri Jan Arogya Yojana is launched as this component.
Features of the Scheme
• Beneficiary Identification: PMJAY primarily targets the poor, deprived rural families and identified occupational category of urban workers’ families, 8.03 crore in rural and 2.33 crore in urban areas as per the latest Socio-Economic Caste Census (SECC) data for both rural and urban areas as well as the active families
78 www.visionias.in ©Vision IAS
under the Rashtriya Swasthya Bima Yojana (RSBY). There is no cap on family size and age as well as restriction on pre-existing conditions.
• Hospitalization cover from inpatient care to post hospitalization care: The Yojana will provide a coverage up to Rs. 5,00,000 per family per year, for secondary and tertiary care hospitalization through a network of Empanelled Health Care Providers (EHCP). The services will include 1350 procedures covering pre and post hospitalization, diagnostics, medicines etc.
• Universality: One unique feature of the PMJAY is its national portability once fully operational. The beneficiaries will be able to move across borders and
71st Round of National Sample Survey Organization
(NSSO) has found
• 85.9% of rural households and 82% of urban households have no access to healthcare insurance/assurance.
• More than 17% of Indian population spend at least 10% of household budgets for health services.
• Catastrophic healthcare related expenditure pushes families into debt, with more than 24% households in rural India and 18% population in urban area have met their healthcare expenses through some sort of borrowings.
access services across the country through the provider network seamlessly. The beneficiaries will not need a special card. Their Aadhaar numbers will suffice.
• Implementation agency: The National Health Agency (NHA) will provide overall vision and stewardship for design, roll-out, implementation and management of Pradhan Mantri Jan Arogya Yojana (PM -JAY) in alliance with state governments.
• Alliance with the States: The Scheme is principle based rather than rule based -
o It allows enough flexibility to states in terms of packages, procedures, scheme design, entitlements as well as other guidelines while ensuring that key benefits of portability and fraud detection are ensured at a national level.
o The States will have the option of implementing this scheme through a Trust model or Insurance Company based model, though the Trust model will be preferred.
o States have the option to use an existing Trust/Society or set up a new Trust/Society to implement the
Scheme as State Health Agency and will be free to choose the modalities for implementation.
o Centre’s contribution being 60 per cent and the states’ 40 per cent.
o 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 Chaired by
Union Health and Family Welfare Minister.
• IT based: In partnership with NITI Aayog, a robust, modular, scalable and interoperable IT platform will be made operational which will entail a paperless, cashless transaction.
• Fraud detection and Data privacy: NHA Information Security Policy & Data Privacy Policy are being institutionalized to provide adequate guidance and set of controls on the secure handling of Beneficiaries Personal Data & Sensitive Personal Data in compliance with all laws and regulations applicable.\
• Pradhan Mantri Aarogya Mitra (PMAM): The scheme is creating a cadre of certified frontline health service professionals called Pradhan Mantri Aarogya Mitras (PMAMs) who will be primary point of facilitation for the beneficiaries to avail treatment at the hospital and thus, act as a support system to streamline health service delivery.
Significance of the PMJAY
• Road to universal health coverage: According to NITI Aayog, the scheme would increase the public spending on health to around 4 per cent from approximately 1 per cent at present, thereby, dramatically improving provision of healthcare for the poor.
• Catalyst for transformation: It will be an enabler of quality, affordability and accountability in the health system.
o The empaneled hospitals have been tasked to follow the treatment guidelines. Patient outcomes will be monitored.
o Another impact of the PMJAY will be rationalisation of the cost of care in the private sector. With an increase in demand created, it is expected that private sector will move from a low volume-high return
paradigm to a high volume-fair return (and higher net profit) model.
• The earnings of public hospitals under PMJAY will be available for their upgradation and also for incentivising the provider teams as these funds will be deposited with the Rogi Kalyan Samitis. Up to 30 per cent of the overall public spending on the scheme may return to public sector institutions.
79 www.visionias.in ©Vision IAS
• Poverty-reducing measure: Each year, six to seven crore people, above the poverty line, fall below it because of health-related expenses. PMJAY would reduce this number significantly. More than a third of the out-of- pocket expenditure (around Rs 5,000 per household) is due to inpatient hospitalisations. One out of eight families have to incur health expenditure of more than 25 per cent of the usual household expenditure each year. PMJAY will ease this burden on the poor.
• Employment Creation: The scheme will create lakhs of jobs for professionals and non-professionals —
especially women. It will give a boost to the health technology industry.
• NHPM will subsume the on-going centrally sponsored scheme “Rashtriya Swasthya Bima Yojana” (RSBY) and
Senior Citizen Health Insurance Scheme (SCHIS).
Concerns ahead
• NITI Ayog estimates Rs 12,000 crore will be required to run the scheme. However, allocation of just ₹2,050 crore during the current year to the PMJAY cannot provide the promised cover to the large population sought to be included. Not all States and Union Territories are in a position to raise their own share, and a few have not even joined the scheme. The challenge of funding, therefore, remains.
• Health is a state subject under Indian constitution. State governments should regulate the hospital sector under the Clinical Establishments (Registration and Regulation) Act. The law broadly provides for standardisation of facilities and reasonable rates for procedures. Costs are a contested area between the care- providers and the Centre, and many for-profit hospitals see the government’s proposals as unviable.
• Union government scheme covers only the deprived beneficiaries as per the caste census, thus bringing down the number of people to be covered. But many schemes implemented by states have a wider range of beneficiaries. For instance, Karnataka’s health insurance scheme covers all the residents of the state. This leads states hesitating adopting PMJAY.
• Sustainability of insurance companies has to be ensured. According to the Insurance Regulatory and Development Authority of India’s data on incurred claims ratio (premium earned versus pay outs) for government-sponsored health schemes, it went up from 87 per cent in 2012-13 to 122 per cent in 2016-17. In case of PMJAY, the government has set a premium of Rs 1,050. Insurance companies find this amount very low to provide coverage. This would be more of an issue in states like Kerala where claims ratio is quite high.
• Though hospital care is a big expenditure, it is still a very small percentage of people’s Out of Pocket (OoP) expenses on healthcare. People spend much more on illnesses that don’t need hospitalisation and are not covered under insurance. NSSO 2014 round shows there was no relief from increasing health expenditure w.r.t
2004.
• Along with Insurance model focus must be on strengthening the country’s health infrastructure. It would have a long-term impact. Globally, countries with adequate public health facilities have been successful in implementing health insurance schemes. e.g. Thailand, extensively focused on strengthening the public health infrastructure before rolling out its Universal Coverage Scheme in 2001.
Conclusion: The “best health care at the lowest possible cost” should be: inclusive; make health-care providers accountable for cost and quality; achieve a reduction in disease burden, and eliminate catastrophic health expenditures for the consumer. Ayushman Bharat – Pradhan Mantri Jan AarogyaYojana (AB-PMJAY) is a paradigm shift from sectorial, segmented and fragmented approach of service delivery through various national and State schemes to a bigger, more comprehensive and better converged and need based service delivery of secondary and tertiary care.
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