Falling short on most counts (The story of Ayushman Bharat healthcare scheme 2018)

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Falling short on most counts (The story of Ayushman Bharat healthcare scheme 2018)

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• The revolutionary Modicare: When many call Modicare (NHPM) a revolutionary model, we can try to compare with US’s Obamacare. Modicare wants to cover 10 crore families, while Obamacare covered just 2 crore individuals (18-64 years).
• Financial comparison of the two schemes: 
1. In 2015, US budgetary provision for Obamacare was $ 16.3 billion (At 60 Rs/$, it becomes Rs.97,800 cr). 
2. US medical costs are 200 times higher, so let us reduce it – and it becomes Rs.480 crores. 
3. But Modicare is covering 25 times more people – so total expenses should be Rs.12,225 crore (Allotted sum = Rs.2000 crores only) 
4. This is a conservative calculation – that same incidence of illness will be seen in poor in both nations. That is wrong.
• The story of RSBY: In 2017-18, actual expenses were Rs.470 crores, against the budgeted Rs.1000 crores. Coverage is for 3.63 crore families, upto a max of Rs.30,000 in health-care costs. For Modicare, it is 10 crore families and Rs.5 lac. So three times more coverage (10 crore / 3.63 crore) and premium goes up by half (at least), total allocation needed = Rs.26 k crore.
• Insurance versus Public Provisioning of health: The most fundamental question is always this! Can an insurance-based solution be ever as good as actual provisioning of government health-care services? In pure insurance schemes, the out-of-pocket expenses will be high. In India, 1% of GDP is spent on health-care, and OOP expenses are 65%. Thailand’s figures are 2.89% and 12% only.
• Government ends up paying more: As such insurance-based schemes induce more hospitalisation, costs always go up with time, and so do premiums (so govt. pays more). And, insurance firms start cross-financing losses arising from private policies through such lump-sum govt. payments.
• Since profit is the motive … As insurance firms work for profits, they will always pay out total claims less than the total premiums recd (from govt.). Hence that is the upper limit of public provisioning for health-care.
• Disaster awaits: It seems that the Modicare scheme may fail spectacularly, as the withdrawal of govt. from public healthcare provisioning will weaken all services.
• Summary : Indian health-care needs massive public investments, something that the Modicare scheme goes directly against.

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