Budget 2024-25: Ayushman Bharat -- Dream or Dilemma?

As the Narendra Modi government gears up for the first budget of its third tenure, it is set on making healthcare more accessible with a significant expansion of the Ayushman Bharat health insurance scheme over the next three years.

According to PTI, discussions are underway to increase the annual insurance coverage under the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) from ₹5 lakh to ₹10 lakh per family. This major upgrade is expected to be announced by Finance Minister Nirmala Sitharaman in the upcoming Union Budget 2024-25.

Additionally, the ruling Bharatiya Janata Party’s (BJP) election manifesto promises to extend the scheme to include the transgender community and all senior citizens over 70 years old.

In the interim Budget 2024, Sitharaman allocated ₹7,500 crore for the scheme, an increase from ₹6,881 crore in the revised estimate (RE) for 2023-24 and ₹7,200 crore in the budget estimate (BE) for 2023-24. Given these forthcoming changes, it is crucial to evaluate the performance of the Ayushman Bharat - Pradhan Mantri Jan Arogya Yojana to date.

Ground Realities

Bhim Tripathi from Jhansi, Uttar Pradesh, has been waiting six months for approval of his Ayushman card. Due to recurrent health issues, he hasn’t been able to work as an agricultural labourer for four months, relying instead on income from his livestock. "If the card was made, it would have been so helpful for me," he told this writer.

Bhim Tripathi and his wife in Jhansi

The PMJAY eligibility criteria are based on the 2011 Socio-Economic Caste Census (SECC), targeting poor and vulnerable families in rural and urban India. Initially, the scheme aimed to cover 10.74 crore families, about 50 crore individuals. By 2022, the scope expanded to 12 crore families, including those under the National Food Security Act (NFSA) and the Rashtriya Swasthya Bima Yojana (RSBY) from 2008.

As of 2023, further expansions based on additional state criteria have increased the eligible beneficiary list to about 15.5 crore families. States must bear the full cost for beneficiaries added beyond the Central government’s criteria (SECC 2011, NFSA or National Food Security Act, and RSBY or Rashtriya Swasthya Bima Yojana). At least 23 states have opted for this approach. This expansion reflects a significant increase in the beneficiary base and over the past two years, 3.14 crore beneficiaries have benefited under the scheme, leading states to bear additional costs for these individuals.

When an eligible beneficiary applies for the Ayushman Bharat Card, the identification involves matching applicant details with the eligible list (SECC and RSBY data) and sending relevant documents online for approval. The system generates a match confidence score from 1 to 100. The Comptroller and Auditor General of India (CAG) report of 2023 noted that no uniform threshold for approval or rejection has been set by the National Health Authority (NHA). Consequently, out of 94.88 lakh rejected cases, 38.57 lakh (40.65%) were rejected despite having a match confidence score of 51 to 100.

Reports on the number of individual beneficiaries under PMJAY also vary. The Press Information Bureau (PIB) in March 2023 stated the scheme covers over 60 crore individuals. However, in August 2023, the Minister of State in the Ministry of Health and Family Welfare, S.P.S. Baghel, gave the number as 55 crore individuals. In contrast, the NITI Aayog report of 2021 claimed around 70 crore individuals. This discrepancy highlights the evolving nature and complexities of accurately reporting PMJAY’s coverage.

From 2021 to 2023, the number of families included in PMJAY has increased, but different sources provide varying individual beneficiary numbers. This variation underscores the dynamic and expanding nature of the scheme, highlighting the challenges in translating policy into effective ground realities, where each beneficiary’s record is crucial.

State vs. Centre

In a meeting held on May 1, 2024, by NITI Aayog with private hospitals and the Union Health Ministry, it was revealed that many private hospitals across various states had scaled back services for beneficiaries of AB-PMJAY. The primary reason cited for this was the delay in payments and insufficient fund allocations from state governments to the health insurance scheme.

Launched in 2018, AB-PMJAY is jointly funded by the Central and state governments in a 60:40 ratio. This year, the Union government has allocated ₹7,500 crore to the scheme. Although the NITI Aayog report detailing these issues has not yet been released, multiple media reports have highlighted these ongoing challenges.

States can implement PMJAY through three distinct methods: trust mode, insurance mode, and hybrid mode. In trust mode, the state government runs the scheme independently, without involving any insurance company. Insurance mode involves selecting an insurance company to manage the scheme, while hybrid mode combines both approaches.

By 2024, as many as 23 states and Union Territories (UTs) had adopted the trust mode, seven had selected the insurance mode, and three opted for the hybrid mode. In contrast, West Bengal, Odisha, and Delhi decided not to participate in PMJAY, instead relying on their own state-specific health programmes.

The financial responsibility for PMJAY is shared between the Central and state governments. In most states and UTs with legislative bodies, the Central government covers 60% of the funding, with the remaining 40% borne by the states. For Himachal Pradesh, Uttarakhand, Jammu & Kashmir, and the seven Northeastern states, the cost-sharing ratio is 90:10 in favour of the Central government. In states and UTs without legislative Assemblies, the Centre may provide up to 100% of the funding, depending on specific circumstances.

A critical aspect of this financial arrangement is the insurance premium cap set by the Central government, which limits its own contribution. As of 2023, this cap is set at ₹1,500 per family per year, up from ₹1,052 per family per year until February 2022, according to a News18 report. If the premium set by insurance companies or state agencies exceed this cap, the additional costs must be covered by the states and UTs.

Unfortunately, specific details about the premium charged by state agencies or insurance companies are not readily available. This premium cap is intended to keep the Central government's spending within budget, but it also means that states and UTs must bear any extra financial burden if higher premium are necessary to meet their healthcare needs.

Challenges in Expansion

The Hospital Empanelment and Management (HEM) guidelines for PMJAY classify criteria for hospital empanelment into two broad categories: General and Specialty. Hospitals must meet advanced criteria to offer specialty packages in addition to general services. This structured approach has facilitated a significant expansion of the network of empanelled hospitals, growing from 7,387 (3,413 private and 3,974 public) in 2018 to 28,432 (12,859 private and 15,573 public), as of June 12, 2023.

However, this growth has not been without challenges. The Parliamentary Committee's December 2023 report highlighted significant deficiencies in empaneled hospitals, including malfunctioning medical equipment and a lack of basic infrastructure such as IPD (in-patient) beds, operation theatres, ICU care with ventilator support, blood banks, pharmacies, and round-the-clock ambulance services.

The average bed size per Empaneled Healthcare Provider (EHCP) is roughly 48 beds, totaling around 14.28 lakh beds across all empaneled hospitals. This translates to 2.5 beds per 1,000 people for the estimated 55 crore beneficiaries. Although this figure surpasses the national average of 0.6 beds per 1,000 people, it falls short of the World Health Organisation standard of five beds per 1,000 people.

The average of 48 beds per empaneled hospital suggests that most participating institutions are small-scale, with many larger hospitals opting out of the scheme, as also pointed out by NITI Aayog in meeting on May 1. According to the NHA, most of these hospitals are in Tier-2 and Tier-3 towns, with fewer in Tier-1 or metropolitan cities. However, a state-wise analysis shows the availability of EHCPs per one lakh beneficiaries is particularly low in states like Assam, Maharashtra, Rajasthan, and Uttar Pradesh.

This scarcity of specialty services in some districts force PMJAY beneficiaries to travel to other districts or states for treatment. Furthermore, in Jharkhand, two private EHCPs were not providing three specialties to PMJAY beneficiaries, which were otherwise available for the public and in Assam, 13 EHCPs were providing 4% to 80% of available facilities to PMJAY beneficiaries.

On the part of hospitals, the problems under the scheme are different. Adding to these challenges are delays in the hospital empanelment approval process. The Parliamentary Committee noted that in some cases, these delays ranged from one day to 44 months beyond the stipulated 30-day period. The Committee has recommended that the government review and streamline these procedures to reduce approval pendency, ensuring all effective checks are carried out promptly.
System Issues

Dating back to July 2020, the CAG audit report found a major issue with the Transaction Management System (TMS) used for PMJAY (Ayushman Bharat) health insurance. The system was letting hospitals submit pre-authorisation requests for patients who had already been marked as deceased in earlier treatments under the scheme.

The NHA, which manages PMJAY, acknowledged the problem and said they had put in place checks on April 22, 2020, to ensure that a patient's PMJAY ID would be disabled once they were marked as deceased in the system. However, the audit found that this wasn't working as intended. Patients who were previously shown as deceased were still able to receive treatment and claims under the scheme.

Data analysis revealed that 88,760 patients were marked as deceased during their treatment under PMJAY. Despite this, there were 2,14,923 new claims paid out for these patients, with 3,903 of these claims, amounting to ₹6.97 crore, paid to hospitals. The highest number of such cases were found in Chhattisgarh, Haryana, Jharkhand, Kerala, and Madhya Pradesh.

The NHA responded in August 2022, explaining that back-dating of admissions was allowed for operational reasons, with pre-authorisation requests being raised within three days for private hospitals and five days for public hospitals. However, the CAG report argued that this explanation was not valid. The fact that pre-authorisation initiation, claim submission, and final claim approval were happening for beneficiaries already marked as deceased, showed flaws in the system and made it susceptible to misuse.

Ayushman Bharat is a landmark initiative aimed at providing accessible healthcare to millions of vulnerable families in India. Despite the government's ambitious plans to expand coverage and include more beneficiaries, several challenges remain. Payment delays and insufficient fund allocations have led private hospitals to reduce services, while discrepancies in beneficiary data and the approval process have further complicated the scheme's implementation. Addressing these operational and financial hurdles is essential to realising the scheme's full potential and providing comprehensive healthcare to all eligible citizens.

"We are dependent on the government for everything. We are beneficiaries of the Awas Yojana and receive rations, yet we are still not approved for the Ayushman Card," said Bhim Tripathi from Jhansi.

As the Modi government aims to increase insurance coverage and broaden the scheme's scope, it must address these existing gaps to ensure that eligible beneficiaries like Bhim Tripathi and his family receive the healthcare they are entitled to.

Shubhangi Derhgawen is a freelance journalist based in Delhi.