The NDA government’s announcement of a health insurance scheme covering 500 million poor and needy Indians is indeed laudable. An estimated 75 million Indians are driven to bankruptcy and poverty each year because they have to pay over 60% of hospitalisation costs out of their own pockets.

Given the dismal healthcare scenario, the NHPS can be a game changer if implemented effectively. Expectedly, the financial allocation and overall contours of the scheme have generated extensive discussions. For NHPS to be the optimal model to deliver sustainable, quality healthcare to 40% of India’s population some crucial questions have to be addressed.

What is a viable funding model for NHPS? How long will it take states to sign up for the NHPS scheme? Has the NHPS been conceptualised as an end-to-end integrated healthcare delivery system or only as a cashless secondary and tertiary care model? Is there a plan for a PPP model?

The math being discussed to fund health assurance to 500 million people ranges between Rs. 10,000 crores and Rs 30,000 crores depending on how the government plans to roll out the scheme. I believe it is a cost that we can afford and a cost we must afford to ensure inclusive economic development. So, the question about the financial model for the scheme will need to be addressed expeditiously.

Regardless of whether the government follows the insurance model or reimbursement model, there are certain basic objectives that NHPS would need to achieve. It has to provide cashless hospitalisation to 100 million families, with the upper limit capped at Rs. 5 lakhs per family per year.

For FY2018-19, Rs 2,000 crores has been set aside for the scheme, which will be rolled out in the second half of the fiscal.

To assess the optimal model, the government could run pilots to cover 1 million families enrolled on a “first come, first served” basis in Phase 1. The Rs 2,000 crores can be considered well spent if the first phase is implemented effectively and it yields key learnings, which can be applied to the full rollout of the scheme in FY 2019-20.

The Centre wants to share NHPS costs in a 60:40 ratio with all states except the hill states, for which the split will be 90:10. While Uttar Pradesh has said NHPS rollout is possible in two months, West Bengal has opted out of the scheme. As is evident, getting all the states to cooperate could prove to be difficult but I am sure that citizens will demand that their state governments sign up once the effectiveness of NHPS is demonstrated in neighbouring states.

I believe the NHPS can be effectively used to capture valuable pan-India medical data, with the linking of Aadhaar identification number to patient Electronic Medical Records (EMRs).Block chain technology can be used to develop a seamless infrastructure for insurance-based NHPS to prevent fraud and ensure accountability and traceability.

I believe that with a few modifications the NHPS can offer a unique opportunity to the government to map out a comprehensive healthcare ecosystem, encompassing primary healthcare centers (PHCs), wellness centers, secondary & tertiary care hospitals, along with the required medical human resources, complemented by an IT backbone to support EMRs, health databases and telemedicine.

Integrating primary healthcare into NHPS can make the scheme both viable and sustainable as downstaging diseases through diagnosis at PHCs can reduce the burden on tertiary care hospitals.

PHCs need to be conceptualised as diagnostic and preventive health centres run by technicians and Ayush doctors. The government needs to allocate budget to upgrade 20,000 PHCs to be digitally enabled e-PHCs. It can emulate the e-LAJ model created by Biocon Foundation for the PHCs it runs in rural Karnataka and Rajasthan. At a cost of Rs. 5 lakhs per PHCs, this will amount to Rs 1,000 crores.  Assuming each PHC supports a minimum population of 25,000, or 5,000 families, upgrading 20,000 PHCs would support 100 million families.

Preventive healthcare should be made an integral part of NHPS. Mass screening for NCDs as a part of the preventive healthcare plan can reduce the burden of hospitalisation caused by disease progression.

The government can bridge the deficit of doctors at PHCs through a combination of technician-led diagnostic centres, Ayush doctors, nurses and telemedicine. ASHA workers, attached to PHCs, can conduct technology-enabled mass screening.

Most PHCs in India provide only limited services that represent less than 10% of all morbidities. One of the important announcements in the Budget was the allocation of Rs 1,200 crores for setting up of 1.5 lakh Health & Wellness Centres. By integrating these Health & Wellness Centres with the PHCs, the government can deliver on its plan of providing comprehensive healthcare, including check-ups for NCDs, maternal and child health services, as well as, essential drugs and diagnostic services.

Moreover, the government needs to look at creating a PPP model to maximise the availability of hospital infrastructure for NHPS by regulating service charges at private hospitals for this scheme. Online technology can be used to ensure transparency and accountability.

Finally, I believe a data-driven methodology to measure outcomes could prove to be crucial for the success of NHPS.

A well-planned NHPS can give a big push to the eventual introduction of much-needed universal health coverage in our country and prove to be transformative for the Indian economy.

The Article was also published on Economic Times on February 28, 2018 under the title:

Start a healthy habit: Centre needs to maximise availability of hospitals for NHPS


  1. I accept on ur view on enforcing to people underprivilage are benifited but when comes to medical data it is a concern as we have no mechanisms that are hackproofing of personal health information.If it goes to wrong hands that is a large threat than a nuclear bomb.

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