India is in a state of health transition. Nearly 60 millionpeople are pushed into poverty every year. The biggest takeaway from union budget 2018-19 is the National Health Protection Scheme. This is a part of current government’s Ayushman Bharat project. It is an ambitious scheme which has generated hope and anxiety because it is world’s largest government funded healthcare programme.The National Health Protection Scheme has promised to cover 10 crore families involving 50 crore family members with health insurance cover of Rs. 5 lakh for secondary and tertiary hospitalisation.

How is NHPS better than RSBY :-

• NHPS does not require the renewal of the ID card every year, the ration or the Aadhaar card being adequate
• Services can be accessed from any empaneled hospital in the country
• An increase in the sum assured from Rs 30,000 to Rs 5 lakh, per family per year.
• It will be critical for the government to strengthen the overall healthcare system-including the infrastructure, availability of healthcare professionals and even the regulatory environment-for the effective implementation of the NHPS.
• The NHPS will be easier to implement by the southern states like Andhra Pradesh, Karnataka and Tamil Nadu, given their better health infrastructureand the experience of running regional health insurance schemes. 

NHPS does not offer the required solution to India’s healthcare problems :-

• The amount of Rs 5 lakh per family is a massive and unexpected hike from the existing fund of Rs 1 lakh per family. This amount is 17 times bigger than the RSBY scheme and will cover 40% of India’s population.

• Though it improved access to health care, it did not reduce out-of-pocket expenditure (OOPE), catastrophic health expenditure or health payment-induced poverty.
• The NHPS addresses those concerns by sharply raising the coverage cap, but shares with the RSBY the weakness of not covering outpatient care which accounts for the largest fraction of OOPE.
• The NHPS too remains disconnected from primary care.
• Universal health insurance through private hospitals has not worked for the poor anywhere.Biggest beneficiaries are the private hospitals and insurance companies. There is no substitute for public health care. 
• The government’s proposals do little to prevent poor health in the first place. India is plagued by increasing levels of water and air pollution, some of it worsened by pro-business policies. Malnutrition, poor sanitation and lack of proper housing also remain major problems.
• Earlier programme failures cast new doubts:-
  1. In its final iteration in 2016-2017, the RSBY also targeted 5.9 crore families, and managed to enroll 3.6 crore families. Thus the government’s announcement today of reaching ten crore families is also vastly ambitious
  2. There is evidence to show that despite efforts towards pushing for increased insurance coverage, neither have the poorest been reached out to nor has there been efficient financial protection.

• Access to medical services:-
  1. The critical barriers are acute shortage of human resources, huge operational costs and the low volume of paying patients to offset expenses.
  2. Expectation that the corporate sector hospitals, that seem to have deep pockets to take such risks, will rush in to expand their footprint once such a market is created, appears to be problematic, given that the sector is showing signs of fiscal stress.
• Budgets:-
  1. States have been reneging on their payments to hospitals. Under the Aarogyasri scheme, Telangana has not reimbursed hospitals for a year.
  2. The non-synchronisation of financial releases of the Centre and states can lead to partial payments, forcing hospitals to bill patients.
  3. Given the all pervasive scale of corruption, the large pool of illiterate patients, the information asymmetry, the fiscal stress and shifting priorities, the scheme could result in hospitals shortchanging the poor even more.
  4. In real terms and as a percentage of GDP, there is a decline in the health budget this year.
• Cost of care:-
  1. Prices are likely to be substantially hiked necessitating a higher outlay. Besides, with increased utilisation, premiums are likely to increase in future years. As it is, the NHPS has increased the base premium amounts. 

Way forward:-

• NHPS requires a high level of cooperative federalism, both to make the scheme viable and to ensure portability of coverage as people cross State borders.
• The NHPS will pay for the hospitalisation costs of its beneficiaries through ‘strategic purchasing’ from public and private hospitals.

• Both Central and State health agencies or their intermediaries will have to develop the capacity for competent purchasing of services from a diverse group of providers.
• An incentive-based model for the government hospitals will help improve their performance and ease some of the supply constraints. The government should purchase healthcare services from the private players, wherever the government doesn’t have the wherewithal to cater to the demand.
• Reducing supply gaps in needy areas by optimising the functioning of the public facilities that have unused capacities due to lack of human resources and diagnostics is necessary
• Incentivising the small and mid-level hospitals to provide services in accordance with quality guidelines and more importantly, aggressively strengthening primary healthcare to reduce hospitalization need to be done.