Healthcare Expenditure Not the Same For All

According to the Central Government Health Scheme (CGHS) and the National Rural Health Mission (NHRM), the per capita expenditure by the government varies drastically. On one hand the central government employees like- current and ex-member of Parliament, retired and serving babus, the judiciary etc. are offered the annual capita expenditure of more than Rs. 5000. And, the rural masses come under a slab of just Rs 180 per head.

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    CGHS is financed via two modes, first being the Centre’s tax revenues and second is the share of wages contributed by the beneficiaries. Beneficiaries’ contribution is decided on the basis of the pay scale that might vary from Rs 600- Rs 6000. Here the government revenues make 95% of the fund.

    CGHS in 2012-13 had spent more than Rs. 1600 crore for covering 10.3 lakh card holders and 33.6 lakh beneficiary base. Delhi topped the list with 40% cardholders that exhausted 60% of CGHS budget, followed by Kolkata.

    Critics believe that the reason behind the lower enthusiasm in the government to curb the escalating healthcare costs might be the presence of schemes like CGHS which are sufficient to take care of the earning member and his family.

    Another noticeable feature of CGHS is that there is no limit on expenses as in case of most publicly funded health coverage schemes like the Rashtriya Swasthya Bima Yojana’s limit- Rs 30,000 per family per year, Andhra Pradesh's Rajiv Aarogyasri’s limit- about Rs 2 lakh per family per year and Tamil Nadu's Kalaignar scheme’s limit- Rs 1 lakh over four years per family.

    The Employee State Insurance Scheme (ESIS) also does not have any cash limit but the per capita medical expenses on its beneficiaries is only Rs 379. The scheme looks after worker and their families which touch the count of about 5.6 crore people. ESIS and CGHS are the only 2 insurance schemes with comprehensive health cover that includes- hospitalization, outpatient care and preventive care.

    A Critical Assessment of the Existing Health Insurance Models in India” is a report displayed by the planning commission in the year 2011. It states how ESIS tries to keep lower costs by providing their own facilities in most cases. And, CGHS is being driven by high-end tertiary care offered by corporate hospitals and 100% inpatient via private network of hospitals.

    Among the state funded insurance scheme, CGHS has the highest hospitalization rate of 22 per 1000 beneficiaries. The average hospitalization expenses range higher than the commercial insurers but lower when compared to other private insurer.

    A public health expert informed that prescription drugs are one of the big drivers of cost under CGHS. It offers vast benefits to few million of people. CGHS purchases expensive and branded drugs for its own employees which actually diminish the transparency related to the CGHS operation. CGHS functions secretively by not publishing or reporting about its performance publicly, as per the Planning Commission report. And, CGHS does not even provide its claims ratio.

    Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.

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