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Thursday, August 18, 2022

No matter what you do, insurance firms will try make money. That is when the system comes in: NITI Aayog’s VK Paul

NITI Aayog member V K Paul talks about why the National Health Mission is an unfinished agenda, lists its achievements so far, explains why the challenges before Ayushman Bharat will be surmounted, plays down fears of insurance fraud, and urges that one be part of this “havan” of transformation, and “shed the negativity”.

vk paul niti aayog, niti aayog member vk paul, national health mission, indian express idea exchange, ayushman bharat, planning commission NITI Aayog member V K Paul with Senior Assistant Editor Abantika Ghosh in The Indian Express newsroom. (Express Photo Amit Mehra)

Abantika Ghosh: When UPA rolled out the National Health Mission (NHM), it was aimed at strengthening the health system. If we are still talking about the same issues for Ayushman Bharat in 2018, was NHM a failure?

No, not at all. The NHM came at the right time, when India could spare more resources for health. And this has helped us identify our health agenda — the mother and child. That is where you always start… maternal care, child care, newborn care, HIV, infectious diseases, tuberculosis and reproductive health. This should be the focus for any nation. If we have not made progress in these areas, then they should be looked at. We can call NHM an unfinished agenda. Let me proudly say that the results of NHM are worth noticing. Did anybody think that India could manage to reduce maternal mortality by three-fourth as part of the Millennium Development Goals of the United Nations? In 2014-16, India’s maternal mortality rate was 130. Our goal was to bring it down to 39. And this is what we are doing now. Infant mortality witnessed two-third reduction in 2015… We are saving 10-12 lakh additional children each year.

Abantika Ghosh: What are the achievements of NHM?

NHM came at the right time and the outcomes are significant. We assigned highest priority to the health sector. And the Ayushman Bharat initiative will take things forward. The system-level change is holistic, and will address issues of financial protection and universal health coverage.

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Abantika Ghosh: The NITI Aayog plans to provide healthcare to 25-35 crore people. Can you tell us about it?

When the NITI Aayog was working with the Health Ministry and other stakeholders to develop a National Health Protection Mission (NHPM), multiple models were considered. This included models which covered the bottom two quintiles — 40 per cent population, and a cover of Rs 5 lakh… Our goal was to provide coverage to everybody. We looked at the practicalities and took the wisest way forward. Start the work by offering Rs 5 lakh coverage to 40 per cent of the population. As the Finance Minister mentioned in Parliament, if it succeeds, we will include other segments of the population. So the goal of universal coverage remains. However, when an initiative is implemented, the benefits are generally lapped up by people who are well-off. This was the case even with the immunisation programme. But I also want to emphasise that 40 per cent of the population not only includes those below the poverty line, but we have also included the lower-middle class. State governments will have to participate in running NHPM. We have created a model in which the states can align their schemes with Ayushman Bharat.

Kaunain Sheriff M: The success of Ayushman Bharat depends on how robust primary healthcare is. But according to CAG data, states are failing to provide primary healthcare.

In the real world, there is never a perfect way of setting things right. For example, where is the supply side for tertiary and secondary care we wish to provide through the NHPM? We have made several estimates for the sake of budget. And these are internal figures meant for the Finance Ministry and government. Take for instance, if Tamil Nadu was earlier doing 300 packages, now it will do 1,350 packages. The state will make an estimate of how many people fall sick. Insurance companies will come out with their own data, then quote their per capita cost. That’s the premium that one should consider.


Our health sector is undergoing a transformation. A lot of supply will be required and a lot of investments. New hospitals will come up — already Odisha is making 20-plus hospitals. Please join and be a part of this havan, shun the negativity. This is an aspirational change. The health sector will never be the same.

Sunil Jain: Will the Centre and states share it in 60:40 ratio?

If the bidding takes place according to the rules, that is how it would be. The numbers were done for the sake of budget exercise. The real numbers will be out when we put this in the public domain for bidding and corresponding assessments through the trust mode.


Sunil Jain: In Bhamashah (the Rajasthan health scheme), the premium increased from Rs 300 to Rs 1,300 in just over two years because the losses were colossal. According to insurance companies, fraud management is at the heart of the subject. Should companies not have better representation in these bodies?

No matter what precautions you take, there will be an issue of insurance companies trying to make money. In some cases, not specific to the Rajasthan scheme, there was cartelisation by companies. They probably made losses after the first year because the premium was too low. So the next year they raised it all together. Now, these are bad practices and have to be tackled. That is where the system would come in.

Wherever in the world there is a similar arrangement, you are always chasing to catch the fraud. The beneficiaries can be a part of the fraud…, somebody can be coaxing them to do wrong things. Doctors, hospitals and TPAs (third party administrators) can also do it. There is a possibility of fraud happening at almost every level and every point of transaction. We are mindful of this. Globally, 8-9 per cent of expense in such schemes is lost to fraud. We have undertaken two intensive studies — for global experience, and experiences of states. It now depends on the groups of people working on it, and the composite report that has been created, which lists all the points where fraud can happen and how best we can address it. Information technology will be an interesting way to tackle frauds. The paperless audit system will also help in fraud mitigation and prevention. We believe that insurance companies have to be given a role that involves hospital interface and claims management.

We had an interesting experience while implementing the Rashtriya Swasthya Bima Yojana, where the job of enrolling beneficiaries was given to insurance companies, and they had a conflict of interest. The more the people enrolled, the less likely insurance companies are to make money… So we have rationalised the role of these companies as accountability to deliver in this case lies with the State. Accountability to take care of frauds is with the State.

Sunil Jain: Insurance companies will have vested interest in keeping the payouts low, and the government has a vested interest in keeping it high. That’s the problem…


Overall, the organisation will make sure that we have the right balance. The government as well as insurance companies are accountable. Ensuring accountability is the business of the system that has been created.

Abantika Ghosh: Do you favour a bridge course for Aayush practitioners prescribing allopathic medicines?


This suggestion has been tackled, and in the revised Bill (National Medical Commission Bill), there will be a provision to address the concern. I personally believe that in primary care, there is a significant scope for coming together of wellness and modern medicine. They have their own distinct character…, underpinnings of science and rationale. We should respect that. We have taken care of the concerns and in the next Bill, things will move forward.

Ravish Tiwari: In the last two weeks, Amazon and Microsoft have rolled out health initiatives. Do you see these projects coming alive in a big way?


We are looking at a system that will change. A strong healthcare system needs a strong information system. And today’s information systems are IT-driven. The national policy is geared towards achieving this end. Efforts are being made by the ministry as well as non-governmental organisations. But Ayushman Bharat is the reason for us to start the process immediately. A system that is resilient, comprehensive and encompasses the entire sector is required. It should not be fragmented — it should help the cause as well as guarantee privacy. It should deliver services as well as provide analytics. Developing this system is the job of experts — we have the Aadhar developed and running so nicely. We have hired the smartest people to work on this. As for the Amazon and Microsoft initiatives, I need to study them in detail.

Abantika Ghosh: Do you think NHPM can be implemented across the nation in an election year?

As many as 25 states have signed it. It is possible that some other states will join a little later. Half of the states have joined the insurance scheme, while the rest have joined other aspects of the initiative. I don’t have the exact numbers yet. In due course, we will determine the budget.

Prasanta Sahu: Have states participating in the insurance model invited bids?

Haryana has already put out a bid and other states will follow. The government is committed to start this initiative as soon as possible. Much of the work at the central- and NHA (National Health Agency) level is complete. States which are ready are rolling out imperatives such as hospital empanelment, energising health agencies, formulating ways in which they will be using the Socio-Economic Caste Census, and preparing public and private sectors. Odisha has decided to have its own scheme and we respect that. India is a federal nation.

Ravish Tiwari: This insurance-based model works on a theoretical premise that it will create private healthcare capacity in rural areas. Therefore, there is a risk that states will abdicate their responsibilities in secondary and tertiary healthcare and leave it to private players, which will lead to a spike in prices. How do you see it unfolding?

First of all, the commitment of the government to the public healthcare system is of paramount importance… We need to take into account the second part of the Ayushman Bharat initiative. In any country with good healthcare schemes, 80-90 per cent of the funding is done by the government — we are committed to fund two-thirds of the scheme. The second is time-bound commitment to build a strong primary healthcare system… This government has talked about AIIMS in every state.

We are present in the tertiary sector in a significant way. We will set the standards and provide training of the highest order. The investment required for setting up AIIMS is huge. States are going to strengthen their medical colleges and district hospitals. And as part of the NHPM philosophy, public sector institutions will provide packages and what these hospitals earn shall stay with them, and can be used to strengthen their infrastructure. This is an additional resource — public money ploughing back into the public sector.

Primary healthcare is the most important thing. The private sector is an asset in our nation. It has jobs, skills, and it has made its name. And what we are doing is bringing poor people into this system. This is the way forward. We are moving along with the private sector. The profiteering part will be taken care of.

Abantika Ghosh: Tertiary care is one person’s business, and primary healthcare is someone else’s. Until the two are linked, will the government not run the risk of going overboard with expenses in the tertiary sector?

One of the ways to link the two is to assign the role of gatekeeping to primary healthcare providers, like it happens in the United Kingdom… We have not yet done it because the supply side is still not there. We will build it. It is one of the important milestones to achieve. We will remain mindful of this. There seems to be a disconnect because of the media, which is first focusing on the NHPM, and then the primary healthcare. These are not two separate things. Look at the philosophical connect provided by the Prime Minister for Ayushman Bharat….

The programme is rolling out now and the exact numbers are emerging. In the NHPM, two-third of government spending will be on primary healthcare. Currently, it is about 52 per cent. If national health accounts are taken into consideration, we have been investing so much more in the public healthcare sector.

Abantika Ghosh: How will the gatekeeping work?

Before you go to the secondary level, you are first examined by a primary healthcare provider. This is the best way to use resources at different levels. Super-speciality institutions also cater to simple things. But because anybody can walk through, it necessarily is not the best way to use resources. Rationalisation should take place — it empowers the system at the grass-roots level. We need to ensure that people are satisfied with the supply side.

Abantika Ghosh: Do you have a timeline for this?

No, not yet. But this is a good way forward. It is good use of resources like the Central Government Health Scheme, which already exists. The process should be straightforward, and anybody can access it. Ayushman Bharat is a path-breaking initiative. It is all about a robust, strong and affordable healthcare system.

Kaunain Sheriff M: You are a global expert in newborn child and maternal health. After what happened at the BRD Hospital in Gorakhpur, has the government been able to utilise your expertise?

I am indebted to the government and the PM for giving me this opportunity to serve the country. The NITI Aayog has a role to play in monitoring these schemes. Neonatal mortality and health are tougher parts of the child health conundrum. Post neonatal mortality has been taken care of. We were the first to bring in facilities such as community-based newborn care, and had a national programme in newborn health in 1992. Now is the time to come up with a second version which will help in taking additional care of babies, and provide life support in terms of ventilation, and larger size special child-care units.

First published on: 15-07-2018 at 01:21:18 am
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