Health insurance for poor may cost Rs 1,00,000 crore

New Delhi: The mega healthcare plan for the poor, as announced in the Budget, will cost about Rs 1,00,000 crore annually and curtail states’ autonomy to design their own policies in the sector, says a research paper, authored by a professor at economic think tank NIPFP.

The paper’s estimate is 10 times higher than the one made last week by Niti Aayog adviser Alok Kumar, who had said that the National Health Protection Scheme (NHPS) will cost around Rs 10,000-12,000 crore annually.

National Institute of Public Finance and Policy (NIPFP) assistant professor Mita Choud-hury said in the paper — ‘The National Health Protection Scheme in the Union Budget 2018: Is it in the Right Direction?’ — that resource requirements for implementing NHPS are likely to be very high.

“Not only would such a scheme impose a heavy burden on both the Union and the states’ exchequers, it will also curtail states autonomy to design their own policies in a sector that is constitutionally mandated to be in their domain,” said the paper.

It added that even if one assumes a “conservative two per cent rate of premium on the insured sum, the scheme would cost about Rs 1 lakh crores annually”.

It further said: “Assuming that 60 per cent of this burden would be borne by the Union government and the rest passed on to the States, the Union government would still need to fork out an additional Rs 60,000 crores annually.”

Niti Aayog Vice- chairman Rajiv Kumar, however, believes that revenue from the one per cent additional cess would be enough to meet the funding needs of this plan. He regretted that “a completely baseless and false propaganda” is being spread against the ambitious scheme of the government.