Even as deliberations continue among key stakeholders on the government’s National Health Protection Scheme (NHPS), it seems that general insurers are a little unsure and apprehensive about how the plan may be rolled out. In a letter written to the department of financial services earlier this month, the general insurance council had besides offering suggestions, indicated that the premium amount of Rs 1,082 for a sum assured of Rs 5 lakh may be “inadequate”. The letter includes several suggestions on aspects like success metrics, premium payment terms and standardisation
of treatments. Senior officials in the industry said that the ministry of finance had asked for suggestions on implementation of NHPS, and the council had shared its views in the letter. They added that at the indicated premium amount, insurance companies could incur losses and many may prefer not to join the scheme. Further, they suggested a cap on the number of individuals per family covered, and upfront payment of premiums by the government — as for all other policyholders.
Finance minister Arun Jaitley had on February 1 unveiled NHPS, the world’s largest government-funded healthcare programme, with an initial target to cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries) by providing coverage of up to Rs 5 lakh per family per year for secondary and tertiary care hospitalisation. Officials of the health ministry held a meeting with non-life insurers last week in Delhi on the implementation of NHPS. The meeting included officials from NITI Aayog and General Insurance Corporation of India (GIC Re).
Senior officials in the insurance industry indicated that a decision on whether the scheme should be floated through a trust or insurance model, had also not been decided yet. In case of a trust model, the government will set up a trust and the trust will perform the role of an insurance company. States like Andhra Pradesh, Telangana and certain parts of Karnataka use the trust model. Under this model, the government fixes the price and there is no scope for price discovery.
On the other hand, under insurance model, the state governments will float tenders and the insurance companies shall be selected based through a bidding process. It is likely that for the initial period, the government might use Socio Economic and Caste Census (SECC) for enrolment of beneficiaries, but insurers have said that in the years to come they should opt for an authentic data base like Aadhaar, to help eliminate frauds. “Currently with Rashtriya Swasthya Bima Yojana (RSBY) premiums are around Rs 300-400 for cover up to Rs 30,000, so we assume that government will increase the premiums in NHPS. “We expect some clarity from the ministry in the days to come regrading the premium charges,” said the CEO of a leading non-life insurer.