The National Health Protection Scheme (NHPS), which is to cover 10 crore poor families by providing health insurance of Rs 5 lakh per family per year, is among the biggest takeaways of Budget 2018. Or so the administration would have us believe. After all, Union Finance Minister Arun Jaitley did use all the right words in Thursday's speech when he said: “We will launch a flagship National Health Protection Scheme to cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries) providing coverage upto Rs 5 lakh per family per year for secondary and tertiary care hospitalization. This will be the world’s largest government-funded health care programme. Adequate funds will be provided for smooth implementation of this programme.”
While the cover of Rs 5 lakh per family per year may sound generous, the minister's words are incredible. Firstly, the Scheme is hardly a flagship scheme. It was announced in last year's budget as well, with a cover of Rs 1 lakh per family, but never came to be. This was admitted by the government as recently as in December 2017, when the Ministry of Health and Family Welfare submitted to the Lok Sabha that the “contours of the scheme are yet to be finalized”. News reports have pointed out here and here that the NHPS is merely a rehash of the Rashtriya Swasthya Suraksha Yojana (RSSY), earlier called the Rashtriya Swasthya Bima Yojana (RSBY).
In fact, the latter, Fact Checker report also observes that the “spending on the health ministry has declined to 2.1% of the total union budget from 2.4% in 2017-18”. So where is the money for the generous NHPS going to come from? The answer is in Jaitley's speech. “In order to take care of the needs of education and health of BPL (below poverty line) and rural families, I have announced programs in Part A of my speech. To fund this, I propose to increase the cess by one per cent. The existing three per cent education cess will be replaced by a four per cent “Health and Education Cess” to be levied on the tax payable. This will enable us to collect an estimated additional amount of Rs 11,000 crores,” the 65-year-old minister said. Ergo, the NHPS will be funded as much by ordinary tax-paying citizens as by the government. The brag about it being the world's largest “government-funded” initiative will have to wait until after the Modi administration actually figures out the scheme's “contours” and implements it.
Infrastructure versus insurance
Ten crore families. 50 crore (500 million) beneficiaries. That's nearly 41 % of India's 1.2 billion population. Even without the scheme having taken off, it's being dubbed ‘Modicare’ – in the vein of Obamacare or the US's Patient Protection and Affordable Care Act, which was estimated to cover between 20 and 24 million people by 2016. China's New Rural Co-operative Medical Scheme, which covers over 90 % of its population to provide subsidised healthcare, had served 670 million people by 2015 alone, and is much bigger in terms of beneficiaries than India's NHPS intends to be.
Nevertheless, the NHPS is an ambitious and well-meaning scheme in the offing. Universal healthcare can at best be a patchy solution in a country where at least two-thirds of healthcare spending as of 2014 (according to the Institute of Health Metrics and Evaluation) comes out of the common man's pocket and where public healthcare infrastructure is kaput. Besides, state-funded health insurance schemes arouse concerns about exploitation by private hospitals and insurance companies.
In Cuba, long endorsed for its public healthcare policies despite concerns about drug shortages and patient consent, the administration has for decades invested in fortifying health infrastructure at multiple tiers such as family physicians, community doctor-nurse teams, local polyclinics, hospitals and research institutes. Measuring parameters consistently testify that Cuba experiences among the world's lowest infant-mortality rate and the highest life expectancy.
If the Modi administration is amenable, it can look for an example closer home (perhaps too close for comfort even). The Delhi government, with its capacity-building approach to public healthcare, has demonstrated a formidable willingness to tackle the problem head on. With over 150 mohalla clinics, a second tier of polyclinics and another layer of hospitals, it has served more than 2 million residents in the last two years.