Modicare #29

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Mains Paper: 2 | Health

 'Modicare' has laudable goals, but it must be supplemented with accessible, affordable and high-quality primary healthcare. Comment


• Prime Minister Narendra Modi’s Independence Day speech was headlined by the announcement of the Pradhan Mantri Jan Arogya Abhiyan, previously Ayushman Bharat.

• The National Health Protection Mission (NHPM), or “Modicare”, will roll out on 25 September.

• It is expected to provide basic health insurance coverage for 100 million families, based on a range of socioeconomic deprivation criteria culled from the Socio-Economic Caste Census 2011 (SECC).

• The scheme will provide coverage up to ₹500,000 per family for secondary and tertiary care and is expected to cost ₹11,000 crore per year.

• This cost will be shared according to a 60-40 formula between the Centre and states.

 What are the challenges for government ?

• It is an attempt to create a publicly-funded national health insurance scheme for the poorer half of the population is an ambitious and laudable goal.

• This is an era of a backlash against liberalization and globalization everywhere, driven by people’s inchoate sense that they have been the losers of market-based economics.

• It is even truer in a vibrant and politically-competitive democracy with many poor voters, such as India that capitalism and the market system must prove their legitimacy each and every day.

• An important component of creating and sustaining political legitimacy, the market, which is key for the pursuit of further liberalizing reforms, is laying the foundations for a re-engineered welfare state for India.

• The irony is that decades of socialism and central planning in India, emanating from Jawaharlal Nehru’s vision, failed to achieve this.

• We have created a welfare apparatus that is corrupt, wasteful, and ineffective in addressing the needs of the poorest. It is exemplified by the fact that  out-of-pocket expenses account for a whopping 67% of total health spending.

 Limitations of this scheme

• Modicare does not extend to primary healthcare, which the weakest link in the provision of public health in India.

• As much as 55% of households in India opt for privately provided primary healthcare, even though free government-provided primary care, in theory, exists down to the village level.

• The crucial point is that poorly delivered primary care inevitably increases the burden on health and finance at the secondary and tertiary levels down the line.

• Data from the National Family Health Survey (NFHS-4, 2015-16) shows that almost half of respondents cite the poor quality of public health provision as the reason for preferring private care.


• Modicare rightly allows insurance to be used at both public and empanelled private hospitals and clinics, recognizing the reality that much of secondary and tertiary healthcare is, in fact, privately provided, by itself, it cannot address an important market failure at the primary level.

• There is absence of adequate or any privately provided primary health care in the poorest and more remote rural regions of the country. Besides, hardly any private doctors or healthcare professionals are willing to serve in rural locations—indeed, a catastrophic market failure.

• For much of rural India and the most disadvantaged of our citizens, public provision of primary healthcare remains the only solution. Regrettably, this system has thus far failed to deliver, forcing most Indians to turn to whatever private care they are able to afford. It is a primary reason of poverty.


.The announcement of the  the creation of 150,000 publicly provided “health and wellness centres” in this years budget is a move in the right direction.

• These are evidently intended to supplement the faltering public primary healthcare sector. Union finance minister Arun Jaitley went so far as to describe these new centres as the “foundation of India’s health system” in the budget speech.

• If, indeed, they are given their due prominence in a holistic approach to healthcare, with sufficient funding and adequate capacity to deliver basic primary health care to the most vulnerable. We could be much more sanguine about the chances for long-term success of Modicare.

Related terms:

  • Hungama report
  • Rashtriya Swasthya Bima Yojana (RSBY)
  • Pradhan Mantri Suraksha Bima Yojana

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Hemant Bhatt

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