Health Insurance Plan

Health Insurance Plan for the Poor to be Reworked

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The beneficiaries will be allowed to receive transport allowance of Rs 200 per hospitalisation with a maximum subsidy of Rs 2,000 in a policy period

The new government is planning to redo the health insurance scheme for the poor with a view to help a further 11 crore people, mostly belonging to below poverty line (BPL) families.

The improvements include increasing the transport allowance, launching wellness checks and extending the validity of smart cards issued under the Rashtriya Swastha Bima Yojana (RSBY), a scheme that was introduced by the previous United Progressive Alliance government.

The beneficiaries will be allowed to receive transport allowance of Rs 200 per hospitalisation with a maximum subsidy of Rs 2,000 in a policy period. Presently, a beneficiary is allowed to receive Rs 100 per hospitalization with a maximum limit of Rs 1,000 a year as transport charges, which are reimbursed by the hospital at the time of discharge.

According to the official, the ministry has also decided to raise the validity of the smart cards, which are required to participate in the scheme, thereby saving on its cost, which is borne by the government.

Smart cards could be possessed at Rs 60 and now need renewal every year. If the proposal gets accepted, the card will cost Rs 100 and will remain valid for three years. This will make it convenient for the beneficiaries besides enabling us to save Rs 80 per card issued. The ministry of labor and employment has already distributed a Cabinet note for inter-ministerial discussion and an announcement to this effect could be made in the budget.

RSBY, a flagship scheme of the UPA government was implemented in 2008, aims to offer protection to BPL households from financial issues due to health shocks that involve hospitalisation.

Under the scheme, the beneficiaries are offered hospitalisation coverage of up to Rs 30,000 for most diseases that require hospital stay. The coverage is meant for five members of a family which includes the head of the household, spouse and up to three dependents. Beneficiaries only need to pay Rs 30 as registration fees while the central and state governments pay the premium to the insurance provider.

Being a centrally-sponsored scheme, 75% of the premium is going to be paid by the central government and the rest by the state government.

However, in the case of northeastern states and Jammu and Kashmir, the Centre would pay 90% and the state 10%. RSBY was initially created to target only BPL households, but was recently improved to cover a number of non-BPL categories of informal sector workers, including street vendors, domestic workers, beedi workers, building and construction workers, and most importantly, those who have worked for more than 15 days under MGNREGS. The target is to cover 7 crore households by the end of the 12th Five-year Plan (2012-17).

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