States in dark over Modicare funding

The Narendra Modi government may be trying to pass on part of the cost of its planned 'Modicare' health scheme to the states.

By Jayanta Roy Chowdhury & R. Suryamurthy
  • Published 10.02.18
Arun Jaitley in Rajya Sabha on Friday. PTI

New Delhi: The Narendra Modi government may be trying to pass on part of the cost of its planned 'Modicare' health scheme to the states.

During a debate on the budget in the Rajya Sabha on Friday, Trinamul Congress's Derek O Brien asked finance minister Arun Jaitley whether he expected the states to chip in with a 25 per cent contribution to the scheme's cost and whether he had consulted them on the subject.

The question elicited a vague reply from the finance minister.

"He did not reply to any of the 12 questions we had raised ... on the Modi-care funding he was quite vague," said O'Brien.

Jaitley passed on the buck to the Niti Aayog, which he said would be "chalking out the contours" of the mega health insurance scheme in consultation with the states.

Niti Aayog officials said they were working on models where the Centre would fund between 60-75 per cent of the insurance cost.

In his budget speech, Jaitley had 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 up to Rs 5 lakh per family per year for secondary and tertiary care hospitalisation. This will be the world's largest government funded health care programme. Adequate funds will be provided for smooth implementation of this programme."

At that time there was no indication that states might be asked to share a part of the cost.

States could bristle if such a demand was made, especially since many of them already have their own health insurance programmes. They could oppose the so-called Modicare programme since they have not been consulted on the issue and it might require them to wind up their own schemes.

Health is on the state list of subjects in the constitutionally mandated division of powers. Though the centre has a limited role to play in public health policy, the powers of actual implementation of health schemes lie with the states.

Jaitley did speak about the "encouraging" aspects of Centre-state cooperation through the GST Council, which had seen states giving up their powers to tax production and movement of goods, but refused to field questions on whether this model would be tried out to bring in 'Modi-care'.

The principal sticking point would be getting the states to come on board, both in terms of agreeing to allow the Centre to interfere in a state subject as well as well as by passing on the burden of a scheme it was trying to peddle as a pre-election success story.

Niti Aayog's CEO Amitabh Kant is a Kerala cadre IAS officer who is aware of the successes his state's health cover has had with poor people. Kerala has a basic healthcare coverage of Rs 30,000 per head and an additional Rs 70,000 coverage for people with serious ailments and is believed to have covered 92 per cent of its below-poverty-line people.

However, the success of the Kerala scheme in keeping costs low is largely because the state has over 2,700 government-run medical institutions, with 3.3 beds per 1,000 people, the highest in the country and two-thirds of the claims come from these public hospitals.

Tamil Nadu has a similar Chief Minister's Comprehensive Health Insurance scheme which covers individuals for up to Rs 1 lakh and Rs 2 lakh in case of critical illness. A states' healthcare report released on Friday by the Niti Aayog and the World Bank show Kerala, Punjab and Tamil Nadu as top performers.