Focus on risk pooling to provide healthcare: NITI Aayog to govt

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Published: November 19, 2019 6:00:18 AM

The report recommended that all healthcare schemes should be brought initially under a common co-ordination arrangement managed by the government, including PM-JAY and NHM.

healthcare, NITI Aayog, NITI Aayog report, economy news, PM JAY, Pradhan Mantri Jan Arogya Yojana, healthFinally, the government could merge functionally and financially all similar risk pools previously organisationally aggregated.

Drawing from global findings on healthcare financing, a NITI Aayog report has proposed that the government should focus on risk pooling, strategic purchasing, health-service provisioning and digital health to make services affordable and reduce out-of-pocket (OOP) spending by vulnerable sections of society.

“A transition for integrating fragmented risk pools, and benefits packages, is essential at the state-level, building basic support systems, reducing transaction costs and dispersion of scarce state talent and capabilities,” the think-tank said in the report titled ‘Health Systems for a New India: Building Blocks—Potential Pathways to Reforms’.

The report recommended that all healthcare schemes should be brought initially under a common co-ordination arrangement managed by the government, including PM-JAY and NHM. “Transition to establish single strategic purchasing rules for all of them, eventually having a single strategic purchaser even if pools continue to be separated financially,” it noted.

Finally, the government could merge functionally and financially all similar risk pools previously organisationally aggregated.

Incrementally homogenise and equalise contributions (from beneficiaries, state and Union, if available) across all merged schemes so that household contributions in contributory schemes are the same for the same package and the subsidised per capita fiscal contributions are also the same for the standard (basic) benefits package.

In collaboration with states, the Centre launched the Pradhan Mantri Jan Arogya Yojana (PMJAY) last year, which offers Rs 5-lakh-a-year free health cover to 10.7 crore households or bottom 40% of the pyramid.

Fragmentation and lack of risk pooling explain India’s very high and slow-to-decrease levels of OOP financing from households which accounts for more than 64% of total health expenses in the country, the report said.

In most emerging markets, health shocks account for between 1-10% of new poor households annually. In India it is 9% (2010).

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