Published in The Lancet
A new health insurance scheme announced in the Union Budget 2018/19 draws praise and also concern about limits to implementation. Patralekha Chatterjee reports from Delhi.
The Indian Government’s plan to provide health insurance for 100 million poor and vulnerable families—or 500 million people, about half of India’s population—has catapulted health to the centre stage of policy and political discourse in the country.
Last week, while presenting the federal budget for 2018/19, India’s Finance Minister Arun Jaitley revealed the National Health Protection Scheme (NHPS), a grand plan aimed at providing coverage up to about INR500 000 (US$7805) per family per year for secondary and tertiary care hospitalisation.
In its latest budget, the government announced a federal allocation of INR20 billion ($31·82 million) for the scheme in 2018–19. The cost of insuring each family is expected to be about INR1100 (US$17·15).
Informally referred to by some as “Modicare” after Indian Prime Minister Narendra Modi, the NHPS is one of the two key health-related announcements in India’s Union Budget 2018/19. This is the Modi Government’s last full-fledged budget before national elections next year.
“My government”, Jaitley said, “has decided to take health-care protection to a new aspirational level”. This will be “the world’s largest government-funded health-care programme”, he said.
The central government plans to start discussing the scheme’s modalities with the state governments from this week. The scheme is expected to be rolled out on Oct 2, a public holiday in India that celebrates the anniversary of the birth of Mahatma Gandhi.
“We’re working out the nitty-gritty of the scheme, and will provide details when the programme is rolled out”, Health Minister Jagat Prakash Nadda recently said.
Although the NHPS has been front-page news in the country in the past week, the idea was broached by Prime Minister Modi in his Independence Day speech in 2016.
Federal funds that have been allocated to the health insurance scheme in the budget. Additional resources will come from the proposed increase of a health and education cess, or tax, and from contributions from state governments who will be implementing the NHPS, government officials, and the Niti Aayog (National Institution for Transforming India), a government-supported think tank that has been involved in the planning process, have said.
Currently, a 3% education cess is levied on personal income tax and corporation tax. The latest budget raises this cess by 1% and the existing education cess will now be replaced by a 4% so-called health and education cess, to be levied on the tax payable.
A second key health-related initiative in the budget relates to the government’s decision to upgrade 150 000 subcentres—peripheral outposts of the Indian health-care system—into so-called health and wellness centres across the country.
These centres will provide comprehensive health care, including for non-communicable diseases and maternal and child health services, as well as free essential drugs and diagnostic services.
The finance minister has invited contributions from the private sector through corporate social responsibility and from philanthropic institutions in adopting some of these centres.
India’s latest budget has also proposed setting up 24 new government medical colleges and hospitals by upgrading existing district hospitals.
The other highlights, as flagged in an analysis by the Delhi-based Centre for Budget and Governance Accountability (CBGA), include additional money to provide nutritional support to all tuberculosis patients at the rate of INR500 (about $8) per month for the duration of their treatment.
India’s public health community has flagged several important concerns. These pivot chiefly around finances for the ambitious schemes and the implementation architecture.
“It appears that India is taking a huge leap on universal health coverage and comprehensive primary health care”, Sakthivel Selvaraj, a senior health economist working with the Delhi-based Public Health Foundation of India told The Lancet.
Patients queue up outside a hospital for medical treatment during Finance Minister Jaitley’s announcement of National Health Protection Scheme, Kolkata, Feb 2
“The proposed [NHPS], which is transitioning from its erstwhile Rashtriya Swasthya Bima Yojana [a health insurance scheme for those living under India’s poverty line; RSBY], is an ambitious programme. At the outset, it appears to be an aspirational scheme. Although doable, it may take 2–3 years to implement it entirely”, Selvaraj said.
The RSBY was introduced by the previous government to reduce out-of-pocket expenditure on health and increase access to health care.
“As far as the NHPS is concerned, it is argued that the centre and states will contribute [60% and 40% of the costs, respectively]. Some southern states are already spending a significant amount of their respective budget on health insurance. In those states, the centre’s contribution will be a top-up, over and above what they are currently spending”, Selvaraj said.
“The state governments may demand cobranding with NHPS or insist on retaining the current brand of the schemes, even with 60% of funds they may receive from the central government through NHPS.”
The moot point is that the NHPS can only provide partial relief to households on out-of-pocket expenditure.
“Currently, millions of poor people in India don’t even have access to a well run primary health-care system”, former Union Health Secretary Jonnalagadda Venkata Rama Prasada Rao told The Lancet.
“The proposed NHPS seeks to address catastrophic health expenditure but it is about secondary and tertiary care, and it doesn’t cover outpatient treatment. A huge amount of money is spent as out-of-pocket expenses on medicines and diagnostics”, he said.
For Prasada Rao, although the proposed health protection scheme is a welcome step, the entire continuum of care, starting from outpatient to secondary and tertiary care, needs to be comprehensively addressed, and primary health care has to be the primary focus to make any real dent in India’s health indicators.
“We also need to keep in mind the dangers of private hospitals exploiting poor gullible people by putting them through unnecessary medical procedures and diagnostic tests…If proper control systems are not put in place before rolling out the scheme, anyone who walks into a hospital can be ‘admitted’ and asked to undergo surgeries that may or may not be necessary”, Prasada Rao told The Lancet.
The implementation of the scheme faces other challenges. “It is not clear whether the NHPS will be implemented using the insurance-based model or the trust-based model”, Ravi Duggal, country coordinator and senior programme officer of the International Budget Partnership told The Lancet.
”Out-of-pocket expenditure on health is going up even in states which have government-funded health insurance schemes. There is a huge shortage of human resources and infrastructure as official rural health statistics show. The budget doesn’t really address the human resources issues”, said Richa Chintan, a health researcher with the CBGA.
Getting the states on board
“The rules of engagement will have to be mutually agreed on a state-to-state basis”, Rajeev Sadanandan, health secretary in the state of Kerala, a human-development star among Indian states, told The Lancet.
Sadanandan believes that it is not impossible to factor the concerns of the states into the national programme, but “a lot of hard work and openness will be needed”.
“This is an opportunity to bring the middle class into a universal health insurance scheme. But it will require imaginative design like the [USA’s]Affordable Care Act. The middle class will be able to buy insurance at much cheaper rates if they are allowed to be part of the expanded pool. This will also improve the quality of care the poor receive”, he told The Lancet.
A backdrop of public health shortfalls
According to the government’s Economic Survey 2017–18, child and maternal malnutrition posed the most challenging health risk in India in 2016, followed by air pollution, dietary risks, high blood pressure, and diabetes.
Many health analysts say that the budget’s health initiatives do not quite address the underlying problems flagged in the survey.
“Budgets for nutrition programmes, like the Public Distribution System, school midday meals, and Integrated Child Development Services, saw a nominal increase, and the budget for maternity entitlements has been reduced. There is a decline in budgets for the National Health Mission and the AIDS control programme”, points out Sulakshana Nandi, national joint convener of Jan Swasthya Abhiyan, the Indian regional circle of the People’s Health Movement, and state convener for the Public Health Resource Network in the state of Chhattisgarh, central India.
“A commitment to improving maternal health and child health, especially in the context of stark socioeconomic inequalities, should have involved a comprehensive effort in investing in, and improving, public systems for health care and nutrition. Unfortunately, the 2018 budget fails on both these counts”, she told The Lancet.