States reluctant to push Modicare over own schemes

NITI Aayog, health secretaries to discuss implementation of central insurance scheme today

The roll-out of the Union government’s ambitious new health insurance scheme could face rough patches, as many states, including those with Bharatiya Janata Party (BJP) governments, are reluctant to withdraw their current schemes in its favour.

In the Union Budget, presented in Parliament on February 1, the Centre said it would introduce health insurance for 500 million Indians, called the National Health Protection Scheme — subsequently dubbed “Modicare”. The scheme will provide 100 million vulnerable families insurance cover of up to ~500,000 a year. The states have the option of running it parallel to their own schemes, or merging to, or running only Modicare.

They are, however, not too eager about it.

Even Gujarat, which is Prime Minister Narendra Modi’s home state, is less than enthusiastic. “Our government has no plan of withdrawing or curtailing benefits of the current state government scheme,” Gujarat Deputy Chief Minister Nitin Patel said. States, which have to provide for 40 per cent of Modicare’s costs, are unwilling to run both schemes together. They feel there will be a duplication of beneficiaries, and they will end up funding both schemes. Beneficiaries of state schemes are likely to enrol for Modicare because of the higher insurance cover. Most states provide up to ~300,000 per family.

The NITI Aayog is meeting state health secretaries on Thursday to discuss the roll-out of Modicare. States are not in favour of merging their schemes with Modicare, as the latter does not have many categories that are part of the cover already provided by 24 state governments. The Centre’s new scheme is only meant for the poor identified by the Socio-economic Caste Census, 2011. Gujarat provides benefit to all with an annual income below ~250,000. Launched in 2012, the Mukhyamantri Amrutam Yojana covers reporters and ClassIII and -IV employees.

Maharashtra provides benefits to 85 per cent of its population; Rajasthan’s Bhamashah health insurance scheme covers people below poverty line and health workers, among others.

West Bengal, which has already opted out of Modicare, provides benefits to workers, selfhelp groups, policemen, gram panchayat members, and disaster management teams. Exclusion of these categories can be counterproductive for state governments, especially when the insurance claim ratio is high.

That is perhaps the reason why poll-bound Karnataka, the last bastion of the Congress, announced universal health coverage for all 14.3 million families that live within its borders, barely a day after Modicare was announced.

“Ours is an assurance model, theirs (Modicare) insurance. In case of assurance, we are duty-bound to honour our commitments. That is the reason we have also amended the Medical Establishment Act,” said Karnataka Health and Family Welfare Minister K R Ramesh Kumar. Another hurdle for Modicare is the uniformity of the scheme.

States follow one of three models — direct reimbursement to beneficiaries; “trust”, where the government appoints a national health insurance company to provide medical coverage; and “awards contract” to an insurer with the lowest bid.

More on Business-standard.in.

Sohini Das from Gujarat, Bibhu Ranjan Mishra from Karnataka, Sahil Makkar from New Delhi, Aneesh Phadnis from Maharashtra, Namrata Acharya from West Bengal, Gireesh Babu from Tamil Nadu, and Dasarath Reddy from Andhra Pradesh contributed to this piece