The scheme that will provide a health cover of Rs 5 lakh per family per year is also being called Modicare or Namocare
National Health Protection Scheme which was announced in the Union Budget on Thursday will be launched either on Independence Day or on Gandhi Jayanti.
Finance minister Arun Jaitley announced in his Budget speech a healthcare scheme for 10 crore families covering expenses of Rs 5 lakh per year. Though the formal name of the scheme is NHPS it has already started being referred to as Modicare or Namocare after former US President Barack Obama’s proposed Obamacare.
“Gandhi Jayanti is the latest by which the scheme will be launched. We, in fact are working towards an Independence Day launch. We are ready. Work has been going on for very long now,” said Niti Ayog’s member health Dr V K Paul.
Interestingly rollout of NHPS is being planned, executed and led almost completely by the Niti Ayog instead of the ministry of health – so much so that in a press conference health minister J P Nadda could not answer any questions on its expected costs or launch deadline though Niti Ayog had the blueprint ready.
While actual estimates would depend on the tendering process etc but according to estimates drawn up by Niti Ayog based on actuarial calculations, the premium for each family is likely to be between 1000-1200 and the annual cost of the scheme in the range of Rs 12,000. As per tentative timelines drawn up by Niti Ayog the scheme is likely to get approvals (from cabinet and the Expenditure Finance Committee) by March, when the stakeholder consultations will happen too. The tender deadline is of July.
“Gandhi Jayanti is the latest by which the scheme will be launched. We, in fact are working towards an Independence Day launch. We are ready. Work has been going on for very long now,” said Niti Ayog’s member health Dr V K Paul.
Niti also expects the scheme to achieve 50% coverage in the first year at a cost of Rs 5000-6000 crore. Till now only Rs 2000 crore has been sanctioned. Basing its calculations on the currently running Rashtriya Swasthya Bima Yojana (RSBY), a highly successful insurance based scheme for migrant workers formerly run by the labour ministry but currently with the health ministry, Niti has reached a premium amount of Rs 1082 per family (there is no cap on family size in the proposed NHPS) based on the fact that for every RSBY beneficiary who is entitled to a maximum cover of Rs 30,000, government currently pays a premium of Rs 500.
Asked about the format of the scheme Dr Paul said: “We are keen on a trust but because it is a federal structure and many states are already running their own health protection schemes, it is the prerogative of the states to decide whether the scheme will be a trust based one or an insurance based one.”
The proposal that is being worked out in fact also has safeguards for both formats. Insurance companies cannot make a profit of more than 20% in administrative and other costs. Moreover if there is a delay in payment, by the company or a trust, there is a provision to pay daily interest.
