“Modicare” – World’s Biggest Healthcare Program

Varun Arora (Business Analytics Expert)

The biggest take away from Union Budget 2018 presented by Finance Minister ArunJaitley is unveiling of mega National Health Protection Scheme (NHPS) dubbed as Modicare. This is being claimed to be world’s largest government-funded National Health Program in both extent and expense. This will provide the cover of Rs 5 lakh to 10 crore families for secondary and tertiary care.

The secondary care services include those provided by skilled medical practitioners, for outpatient treatment, or a brief stay at the hospital for serious illness upon referral by a primary care physician. Tertiary care is for patients who are admitted to hospitals for longer bouts of illness and needs a higher level of specialty care within the hospital. Tertiary care requires highly specialized equipment and expertise.

The RashtriyaSwasthyaBimaYojana (RSBY), which is the precursor of Modicare provides Rs 30,000 cover for up to five members of a below the poverty line (BPL) family. The Centre provides 75% of the total premium while states pay the rest. Around 36 million of 59 million BPL families across 15 states are enrolled in the RSBY scheme.

NHPS will cover around 40% of the country’s population on a cost-sharing basis with states. Under this, the Centre will fund 60%, whereas states will contribute the remaining 40%. It will increase the insurance cover per family by over 1500% from Rs. 30,000 under extent RashtriyaSwasthyaBimaYojana (RSBY), to Rs.5 lakh. The budget has set aside an allocation of Rs2,000 crore for the scheme in 2018-19 rose from Rs 470.52 crore in FY18.

Another laudable move is the allocation of Rs 1,200 crore for preventive health care services. the government also plans to set up 1.5 lakh Health and Wellness Centers under the Ayushman Bharat program. These centers will provide treatment for non-communicable diseases and disburse primary care to young mothers and children. Free supply of essential medication and diagnostics will also be part of the program.

The government is planning to implement the National Health Protection Scheme (NHPS) from October 2, 2018. The government plans to skip the pilot test usually carried out before implementing a major scheme or project in the country since the government is already running a RSBY. A national health agency will be instituted under the scheme to oversee its implementation at the state-level. The identification of beneficiaries is to be done by consulting the 2011 round of the socio-economic caste census which identifies poor in seven deprived categories. The health ministry and NITI Aayog have formed six working groups comprising health department officials of the states and Union territories to give the scheme its final shape. These include a working group to study processes that will enable identification of beneficiaries; issuance of cards; Aadhaar-seeding; claim submission; and settlement.

The biggest challenge is to integrate the NHPS with respective state health insurance schemes as the intended beneficiaries of both schemes are different. There could be large overlaps and cost ramifications since the Socio-Economic Caste Consensus (SECC) data was not seeded with Aadhaar. There could be the possibility of exclusion of beneficiaries. Some states, including Rajasthan and Gujarat, cover people other than those listed in the deprived category. The Karnataka government recently announced that it would cover all state residents in its health insurance scheme, while West Bengal has decided not to implement the NHPS.

On the demand side, no matter how generous the eligibility criteria and coverage of Modicare, it will have limited effect unless eligible households enroll or do not use the program to obtain care. Most of the times, the hospital or insurance company could not process the insurance card or rejected coverage. Its predecessor, RSBY, suffered low uptake rates.

On the supply side, the major challenge will be limited health workforce for implementation. The program will require many verticals in terms of infrastructure, human resources, doctors, pharma products and medical devices. The demand is so huge that it has to be accomplished with ‘Modi speed’ in next few months. At present, there are 479 medical colleges affiliated to the Medical Council of India (MCI) as opposed to 543 parliamentary constituencies. However, their spatial distribution is uneven, with more colleges being clustered around urban centers.  The number of doctors per lakh population is also below par. A World Health Organization (WHO) report titled The Health Workforce in India states that on an average, there are 79.7 doctors per one lakh people in the country. Chandigarh has the most doctors per capita with 279.9 doctors per lakh of the population. Meghalaya has only 27.5 doctors per lakh of the population. All the north-eastern states lag behind the national average in the number of healthcare professionals. Arunachal Pradesh and Nagaland have 32.5 and 35.6 doctors per lakh citizens respectively.

The government would be setting up 24 new government medical colleges and hospitals by upgrading the existing district hospitals in the country. This will ensure at least one medical college for every three parliamentary constituencies and at least one government medical college in each state. This will also not only strengthen public sector capacity to deliver advanced care at the district level but also position medical colleges in district clusters that don’t have any.

Affordable and accessible healthcare is the need of the hour and this is a major step in making healthcare accessible to the downtrodden and marginalized sections of the society. The program has been welcomed by most of the healthcare professionals since it will benefit the Aam Janata. With an estimated 7% of India’s population pushed to provide an essential safety net for the poor. However Revolutionary measures need Revolutionary reforms. The government can learn from the lessons of RSBY to get Modicare’s implementation right after all health of millions of Indians depends on it.


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