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Year : 2018  |  Volume : 11  |  Issue : 5  |  Page : 385-388  

India's national health protection scheme: A preview

1 Department of Community Medicine, Armed Forces Medical College, Pune, Maharashtra, India
2 Department of Community Medicine, Army College of Medical Sciences, New Delhi, India

Date of Web Publication5-Sep-2018

Correspondence Address:
Manisha Arora
Department of Community Medicine, Army College of Medical Sciences, Brar Square, Near Base Hospital, Delhi Cantonment, New Delhi - 110 010
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Source of Support: None, Conflict of Interest: None

DOI: 10.4103/mjdrdypu.mjdrdypu_109_18

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India has recently announced the “Ayushman Bharat–National Health Protection Scheme (AB-NHPS),” one of the largest government health insurance schemes in the world. The scheme aims to provide quality health care to the poor and vulnerable families, a step forward toward the government's commitment on universal health care. The beneficiary households under the AB-NHPS will be based on the deprivation and occupation status of the family, drawn from the Socioeconomic and Caste Census database. The scheme will take care of all the secondary health care and most of the tertiary health care procedures. The road map envisaged for the implementation of the scheme consists of number of challenges such as funding, acceptance by the states, exclusion of primary health care, and outpatient expenditure from the scheme. We conclude that successful implementation of the said scheme will require robust planning, stringent regulations, simplified processes, and continuous monitoring using advanced technological E-health platforms.

Keywords: Ayushman Bharat, challenges, health insurance, scheme

How to cite this article:
Mukherjee R, Arora M. India's national health protection scheme: A preview. Med J DY Patil Vidyapeeth 2018;11:385-8

How to cite this URL:
Mukherjee R, Arora M. India's national health protection scheme: A preview. Med J DY Patil Vidyapeeth [serial online] 2018 [cited 2022 Nov 26];11:385-8. Available from: https://www.mjdrdypv.org/text.asp?2018/11/5/385/240366

  Introduction Top

After seven decades of self-governing independence, India is yet to provide its people with a successful and widely accessible health protection program. A step in that direction, “The National Health Protection Scheme,” touted as one of the largest government-sponsored health insurance schemes in the world, was announced by the finance minister during the budget speech in parliament. The union cabinet under the prime minister approved the launch of this scheme meant to benefit more than 10 crore poor and vulnerable families, targeting 50 crore individuals, with a family cover of Rs 5 lakhs per family per year.[1] The National Health Policy 2017 aimed at providing universal health care and quality services to all at an affordable cost, which was in line with the Sustainable Development Goal 3 of universal health care. The National Health Protection Scheme (NHPS) is an ambitious project of the government of India, aimed at providing quality health care to the poor and vulnerable families, and achieving its commitment on universal health care. The Pradhan Mantri Jan Arogya Abhiyaan (Ayushman Bharat) will be rolled out on 25 September,2018 on the occasion of Pandit Deendayal Upadhyay's birth anniversary, as announced by the hon'ble Prime Minister on 15 August 2018 independence day speech. An official website 'abnhpm.gov.in' has been launched by the government of India for the mission. Ayushman Bharat-National Health Protection Mission (AB-NHPM) will subsume the on-going centrally sponsored schemes – Rashtriya Swasthya Bima Yojana (RSBY) and the senior citizen health insurance scheme. However, despite the RSBY having functioning for more than a decade now, the verdict on the effectiveness of this government-sponsored health insurance scheme is at best mixed;[2] in this backdrop will the NHPM succeed where the RSBY could not, or is the ambitious NHPM merely old wine in a new bottle? This paper outlines the details of the NHPM, as available from public documents and MoHFW press releases, and also some of the problems envisaged in its implementation.

  Ayushman Bharat: How Will it Work Top


Beneficiary households under the AB-NHPS will be based on the deprivation and occupation status of the family, drawn from the Socioeconomic and Caste Census database. The scheme will cover roughly 10 crore families.[1],[3] In rural areas, families having only one room with kucha walls and kucha roof; families having no adult member between the age of 16 and 59 years; female-headed households with no adult male member between the age of 16 and 59 years, disabled member, and no able bodied adult member in the family; SC/ST households; and landless households deriving major part of their income from manual casual labor are included in this scheme. This is roughly 7.5 crores of the total 18 crores of the rural Indian population. Further, families having any one of the following criteria: households without shelter, destitute, living on alms, manual scavenger families, primitive tribal groups, and legally released bonded labor are automatically included under the scheme. These families account for an additional 0.16 crore rural beneficiaries of this scheme. For urban areas, 11 defined occupational categories are entitled under the scheme. Thus, of the 6.52 crore urban households, around 1.92 crores get included in the scheme. Finally, 9.91 crore households stand to be beneficiaries under the NHPS, which includes the 0.22 crores who are covered under the RSBY scheme.


The NHPS will take care of almost all secondary care and most of the tertiary care procedures. It is proposed to set up 1,50,000 health and wellness centers, from within the subcenters and primary health centers to take care of the primary health-care element. To ensure that the umbrella of health care includes everybody, there will be no cap on family size and age in the scheme, unlike the RSBY. Priority will be given to girl child, women and and senior citizens. The benefit cover will also include pre and post-hospitalization expenses, as these were identified as one of the important out-of-pocket expenditures (OOPs) in literature reviewing the impact of RSBY. All preexisting conditions will be covered under the policy. A defined transport allowance per hospitalization is also proposed to be paid to the beneficiary.

The beneficiaries can avail benefits in both the public and empaneled private facilities. All public hospitals in the states implementing AB-NHPM will be deemed empaneled for the scheme. Hospitals belonging to Employee State Insurance Corporation may also be empaneled. Private hospitals will be empaneled online based on the defined criteria. To control costs, the payments for treatment will be done on package rate, and these will be decided by the government. The package rates will include all the costs associated with treatment. For beneficiaries, it will be a cashless, paperless transaction. Keeping in view the state-specific requirements, states/UTs will have the flexibility to modify these rates within a limited bandwidth.[1]


At the center or the apex, it is proposed to set up AB-NHPM council. This will be chaired by the Union Health and Family Welfare Minister. It is also proposed to have an AB-NHPM Governing Board, which will be jointly chaired by Secretary (Health and Family Welfare) and Member (Health), NITI Aayog. It is proposed to establish an AB-NHPM agency (AB-NHPMA) to manage the AB-NHPM at the operational level in the form of a society. AB-NHPMA will be headed by a full-time CEO of the level of secretary/additional Secretary to the government of India. Under this apex, the body will be the state health agency (SHA). It is proposed to set up a structure at the district level too. States would be given the option of rolling out NHPS with either a trust-based model (where states themselves set up a trust which will hold and administer the funds) or through private insurance companies. However, certain reports claim that the government would encourage the states to go for a trust model.[4],[5] To provide a seamless experience to the beneficiary, an Ayushman Mitra(AM), a certified frontline health service professional shall be present at each of the Empanelled Health Care Provider (EHCP) and shall serve as a first contact point for beneficiaries, (abnhpm.gov.in).


The premium per family is expected to be roughly around Rs 1000–1200/year. This cost is to be borne by the center and the state. The scheme will be financed by the general taxation and there will be no earmarked funds especially for this scheme.[3],[4] The contribution of the center and the state toward the premium will be in the ratio of 60:40 in all states except the northeastern and Himalayan states (viz. Jammu and Kashmir, Himachal Pradesh and Uttarakhand), where the center will contribute in the ratio 90:10. As per the NITI Aayog estimates, 5000–6000 crores would be required for this scheme, and the government has allocated 2000 crores in the current budget.[6] To ensure that the funds reach SHA on time, the transfer of funds from the central government through AB-NHPMA to State Health Agencies may be done through an escrow account directly. The state must contribute its matching share of grants within the defined time frame.


After announcement of Ayushman Bharat, the implementation has followed tight timelines. Six working groups were constituted to put together experiences drawn from the RSBY, along with global best practices, and inputs from states running their own health insurance schemes to make recommendations for the NHPS. Based on these recommendations, broad operational guidelines have been laid down in the fields of beneficiary identification, empanelment of hospitals, grievance redressal, claim settlement etc. The first Health and Wellness Centre was launched by the Hon'ble Prime Minister at Jangla, Bijapur, Chhatisgarh on 14 April 2018. The National Health Agency (NHA) was constituted for the effective implementation of AB-NHPM and established as a society on 11 May 2018, (abnhpm.gov.in). The official date for roll-out of Ayushman Bharat has been announced.

The road ahead

In a country where around 63 million people are pushed into poverty due to health-care expenses, NHPS could be an effective approach to ensure universal health coverage. Some of the problems envisaged in the implementation of this program are predominantly the funding, acceptance by the states, exclusion of primary health care and outpatient expenditure from the scheme, problems regarding awareness of the scheme among its beneficiaries who are automatically included under the ambit of scheme, and the best model to provide health-care insurance to be used in the implementation of the program. However, critics are skeptical about this new scheme being proposed by the government and cite the apparent failure of RSBY, which despite now running for almost a decade has shown to be ineffective in reducing OOP expenditures with an average claim ratio of only around 33%. RSBY also left almost 40% of its beneficiaries uncovered.[2],[7] The most important reason for this was lack of good quality care. In most of the northern states, health care was being provided mainly through empaneled private hospitals and clinics due to the abysmal state of the public health infrastructure in these states. In case stringent empanelment norms were followed, even these private hospitals would not have been empaneled, as these were substandard and offered poor quality of care. This coupled with illiteracy and poor awareness and lack of any regulatory mechanism to control these private hospitals, which overtreated the patients, led to RSBY having almost no impact on OOP in these states, despite the government spending money.[2],[7] The only clear gainers seemed to be the insurance company and the private hospitals. However, in the southern states, which have implemented robust health insurance schemes of their own, analysis showed that these states have managed to reduce OOP.

Most reviews of RSBY have divulged that the poor avoid hospitalization due to the associated indirect costs and loss of wages. Most of the expenditure incurred in illness is over OPD treatment, drug, and diagnostics, and these account for two-third of the OOP expenditure as against hospitalization which accounts only for the remaining one-third of the expenditure. The burden of outpatient expenditures that account for the bulk of OOP health care spending is mostly unaffected and utilization of outpatient care may even have increased on account of RSBY.[2] Thus, some of the issues that need to be addressed while implementing NHPS are as follows: first, services to be covered and standard management guidelines for different diseases will have to be defined.

Second, safeguards and regulations will need to be co-opted to avoid unnecessary admissions/procedures and overtreatment. Review of the RBSY scheme showed that even for illness that could be treated on an OPD basis, private clinics resorted to admitting the patients resulting in unnecessary admissions on one hand, loss of wages for the poor on the other and credit on the RBSY was used up and thus not available for more significant illnesses.[8] Thus, the need for stringent regulatory mechanisms cannot be overemphasized. Third, studies indicate that 65% of the health-care expenditure in the country is for outpatient care, which are primarily OOP expenses. If the final goal is comprehensive health care, then effective and quality primary health care is of paramount importance. If there is one lesson to be learnt from the successful universal health coverage of Thailand, then it is the importance of investing in robust primary health infrastructure, in achieving the goal of health care for all. Through setting up of 1,50,000 health and wellness centers, as announced by the government, is a big initiative and it must be implemented effectively, as this will determine and guide the further utilization of secondary and tertiary health-care services provided under the ambit of NHPS.[9] This specifically assumes importance in the light of the fact that the poor prefer to avoid hospitalization due to the associated indirect cost and loss of earning capacity and, therefore, depend on outpatient care and primary health services for their health needs. Without the backing of these effective primary health-care measures, the aim of NHPS will be defeated despite large financial investments into the same.

Finally, there are inherent challenges pertaining to the national wide implementation of the scheme which includes getting the various stakeholders including the state governments on a common agreeable platform and a requirement to work on prevention of possible misuse of the system.[4],[10]

  Conclusion Top

We must realize that implementation of such schemes requires strong planning, stringent regulations, simple and efficient processes, and continuous monitoring using advanced technological E-health platforms. Success of NHPS will depend on a resolute political will, administrative dynamism, and a missionary zeal to fulfill its goals. Implementation failures can not only result in an exponential rise in costs of such schemes but also put a strain on future allocations as well toward the health-care sector.

Financial support and sponsorship


Conflicts of interest

There are no conflicts of interest.

  References Top

Cabinet approves Ayushman Bharat - National Health Protection Mission Press Information Bureau Government of India. Available from: pib.nic.in/newsite/PrintRelease.aspx?relid=177816[Last accessed on 2018 March 29].  Back to cited text no. 1
Karan A, Yip W, Mahal A. Extending health insurance to the poor in India: An impact evaluation of Rashtriya Swasthya Bima Yojana on out of pocket spending for healthcare. Soc Sci Med 2017;181:83-92.  Back to cited text no. 2
NHPS Beneficiaries to be drawn from Economic, Caste Census: Centre to States. The Indian Express; 2018. Available from: http://www.indianexpress.com/article/india/nhps-beneficiaries-to-be-drawn-from-economic-caste-census-centre-to-states-5076049/. [Last accessed on 2018 Mar 29].  Back to cited text no. 3
National Health Protection Scheme: Choosing the Right Model for Implementation. The Financial Express; 2018. Available from: http://www.financialexpress.com/opinion/national-health-protection-scheme-choosing-the-right-model-for-implementation/1114431/. [Last accessed on 2018 Mar 30].  Back to cited text no. 4
Healthcare Scheme Premium to be Rs 900-1,000: Niti | mydigitalfc. Available from: http://www.mydigitalfc.com/plan-and-policy/healthcare-scheme-premium-be-rs-900-1000-niti. [Last accessed on 2018 Mar 29].  Back to cited text no. 5
NITI Aayog Comes to the Rescue as Health Ministry Clueless on “World's Largest Healthcare Programme.” The Wire; 2018. Available from: https://www.thewire.in/220634/health-budget-2018-niti-aayog/. [Last accessed 2018 Apr 08].  Back to cited text no. 6
Prinja S, Chauhan AS, Karan A, Kaur G, Kumar R. Impact of publicly financed health insurance schemes on healthcare utilization and financial risk protection in India: A systematic review. PLoS One 2017;12:e0170996.  Back to cited text no. 7
Ahlin T, Nichter M, Pillai G. Health insurance in India: What do we know and why is ethnographic research needed. Anthropol Med 2016;23:102-24.  Back to cited text no. 8
National Health Protection Scheme: Why Insurance can't Replace Primary Healthcare. The Financial Express; 2018. Available from: http://www.financialexpress.com/opinion/national-health-protection-scheme-why-insurance-cant-replace-primary-healthcare/1058904/. [Last accessed on 2018 Mar 29].  Back to cited text no. 9
Is India Ready for NHPS? The Indian Express; 2018. Available from: http://www.indianexpress.com/article/opinion/columns/national-health-schemes-budget-2018-primary-healthcare-hospitals-is-india-ready-for-nhps-5061319/. [Last accessed on 2018 Mar 30].  Back to cited text no. 10

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