New Delhi: A federal health insurance scheme for the poor that the Congress party-led government launched last year is facing trouble in several states, including ones where the Congress or its allies are in power.
Some of these states are rolling out rival packages and, in some cases, scrapping it ahead of national polls due by May.
The Rashtriya Swasthya Bima Yojana (RSBY), which provides health benefits to unorganized workers living below the poverty line (BPL), was launched in April.
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Rajasthan, which has so far covered 120,000 people under the RSBY, has decided to scrap it. In its place, the newly elected Congress government launched a new scheme on 1 January—Mukhyo Mantri BPL Raksha Kosh (the chief minister’s BPL life protection plan).
Tamil Nadu—where Dravida Munnetra Kazhagam, an ally of the Congress-led United Progressive Alliance (UPA), heads the government—has recently launched the chief minister Kalaignar’s Insurance Scheme for Life Saving Drugs to reach out to the state’s 100 million poor people. While it has no plans to discontinue RSBY yet, it has floated tenders for the new plan, said a state official who declined to be identified.
Rajasthan’s principal secretary R.L. Meena defended his government’s move, saying RSBY has been unproductive. “We have decided not to go ahead with RSBY because we realized...only 8% of the money was actually spent on patients’ treatment,” said Meena.
Rajasthan has earmarked Rs9.26 crore for the project, he said. “Normal cards will be issued to BPL families and special counters will be opened in each hospital,” he said. “Those who are covered under RSBY will be automatically eligible for the new plan.”
BPL families are those that earn less than Rs356.30 per individual per month in rural areas and Rs538 in cities.
While 14 of the country’s 28 states have signed letters of intent with the Centre to take forward RSBY, even Congress-ruled governments—such as those in Arunachal Pradesh and Mizoram—are yet to start the programme, said a Union labour ministry official, requesting anonymity.
According to him, Andhra Pradesh, where chief minister Y.S. Rajasekhara Reddy-led Congress government is in power, had decided not to adopt RSBY as it had launched its own health insurance programme in 2007, funded by the chief minister’s relief fund. This scheme offers free treatment for a little less than thousand for serious ailments and patients can claim expenses up to Rs2 lakh.
Officials of Arunachal Pradesh, Mizoram and Andhra Pradesh governments weren’t immediately available for comment.
RSBY is the Centre’s flagship health cover scheme for unorganized workers, who are either self-employed, unskilled or migrants who travel to cities in search of work. Each beneficiary is issued a smart card in the name of the family head, and family members can avail of cash-less service at both private and public hospitals and claim expenses up to Rs30,000, exclusive of Rs1,000 travel allowance in a year; a separate card is issued for migrant workers who can split the entitled benefits with the family.
The labour ministry official said the RSBY has been opened to private hospitals as more poor people access private hospitals for treatment.
A 2004 National Sample Survey Organization’s data shows that only 30% of the poorest and 26% of low-income groups use government services. Of these, 21% of the poor are indebted due to health care expenses.
Some insurers say RSBY is faltering in some states because of lack of awareness. “Claim ratio is most negligible because people do not know they are insured. We are doing mandatory publicity but it’s difficult to expect from the uneducated to claim their loss,” said A.K. Das, deputy general manager of Oriental Insurance Co. Ltd, which is the implementing agency for RSBY in Delhi and Bihar. He didn’t give details.
“About 80% of India’s population does not have any form of health insurance. I have not come across any person in Delhi who has been able to buy any policy against a payment of Rs30 or Rs50,” said Suresh K. Sethi, chief executive of Ria Insurance Brokers Ltd and vice-president of Insurance Brokers’ Association of India, which has 300 members. “We need plans targeted for the poor to be made available in post offices and through public distribution system so that the benefits reach the people they have been designed for.”
Ruhi Tewari contributed to this story.
Graphics by Sandeep Bhatnagar / Mint