India has completed four years of Ayushman Bharat Pradhan Mantri-Jan Arogya Yojana (AB-PMJAY), the world’s largest public health insurance programme. What has the government’s flagship scheme achieved so far and what do we need from here? Mint explains.
What does our health expenditure represent?
India’s public health expenditure is one of the lowest in the world. Total health expenditure fell from 3.3% in 2017-18 to 3.2% of GDP in 2018-19, while government health expenditure (central and state) as a percentage of GDP fell from 1.35% to 1.28% in the same period. The National Health Estimates showed that the Centre’s share declined to 34.3% in 2018-19 from 40.8% in the previous year, while the share of states increased from 59.2% to 65.7%. silver lining? Out-of-pocket spending as a percentage of total health expenditure declined to 48.2% in 2018-19, although it is significantly higher than the world average of 18.1% in 2019.
What about health insurance penetration?
With a population of 1.36 billion, India is the second most populous country in the world, and is expected to overtake China soon. Retail health insurance covers only 3.2% of the country’s population. Launched in 2018 to provide universal health coverage, AB-PMJAY takes care of the bottom 50% of the population of approximately 700 million individuals. The top 20% of the population is covered through social and private health insurance. Therefore, about 30% of the population, or about 400 million, is the “missing middle” – they have no financial protection for health emergencies.
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Why is healthy healthcare important to the economy?
COVID-19 exposed the economic consequences of poor healthcare. Spending more out of pocket affects savings and consumption. In the workplace, poor health affects physical and mental abilities, increases turnover and leads to low productivity. Data shows that 7% of India’s population is pushed into poverty every year due to healthcare costs.
What is the status of AB-PMJAY scheme?
AB-PMJAY aims to provide quality healthcare for the underprivileged. According to the report, 39.5 million hospital admissions, equivalent to 45,294 crore, have been done so far. State governments have the flexibility to adopt trust, insurance or hybrid mode of implementation. One study found that while trust mode requires large manpower, the output of the scheme is not necessarily high. The beneficiary registration rate was higher in the case of insurance companies as compared to trusts.
What are the shortcomings that need to be addressed?
The focus should be on health care management and disease prevention along with the entire healthcare system including OPDs. The government also needs to focus on health care cover for the “missing middle” population. As a pilot, states can allow the authority implementing the AB-PMJAY scheme in the state to cover the center already missing. Familiarity with the prevailing ecosystem will result in economies of scale.
Jagdish Shettigar and Pooja Mishra are faculty members at BIMTECH
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