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Indian Prime Minister Narendra Modi launches the government health insurance scheme in 2018. However, the scheme has run into problems over non-payment to private hospitals.<\/p>\n\tIndian Prime Minister Narendra Modi launches the government health insurance scheme in 2018. However, the scheme has run into problems over non-payment to private hospitals.<\/p>\n
ROHTAK (Haryana), India \u2014 When 22-year-old Sunita* rushed her father to a private hospital in for a cardiac emergency earlier this month, she expected her government health insurance scheme, Ayushman Bharat\u2013Pradhan Mantri Jan Arogya Yojana<\/a>\u00a0(known as PM-JAY), which promises to cover hospital expenses up to \u20b95 lakh (around $5,725) per family, would spare her family from crushing debt.<\/p>\n Instead, she was told that the hospital in Haryana State had stopped admitting scheme patients over months of unpaid dues from the government. The facility is one of 650 private hospitals across Haryana that have suspended all PM-JAY services in protest over \u20b9490 crore ($59 million) in pending reimbursements.\u00a0<\/p>\n According to the Haryana Health Department, the unpaid dues date back at least six to nine months. The abrupt halt has cut off up to 18 million low-income residents from private-sector surgeries, dialysis, cancer care and other critical treatments.<\/p>\n Sunita\u2019s family, who earn barely \u20b910,000 ($114) a month from farm labour, had to admit her father to a smaller facility with limited cardiac services.\u00a0<\/p>\n \u201cWe had no choice but to borrow money,\u201d she said. The bill ran into several thousand lakhs, \u201can amount my father or any of my relatives had never seen together in our lives.\u201d<\/p>\n National promise under pressure<\/p>\n \u00a0The suspension in Haryana is the latest stress fracture in India\u2019s flagship public health insurance programme, launched in by President Narendra Modi 2018 to provide cashless secondary and tertiary care to the poorest 40% of the population. Nationally, the scheme claims to cover more than 500 million people, with over 25,000 member hospitals.<\/p>\n It also comes as a recent Swiss Re Institute report<\/a> warns that India faces one of the world\u2019s largest health protection gaps, with out-of-pocket expenses accounting for over half of total health spending.\u00a0<\/p>\n The report cautions that without reliable public health financing, millions could fall into poverty due to medical costs\u00a0 directly undermining the government\u2019s universal health coverage goals.\u00a0<\/p>\n A recent Indian study found that nearly 28% of households<\/a> incurred \u201ccatastrophic expenditure\u201d on inpatient healthcare alone in 2024. This is defined as health spending that is over 10% of household\u2019s capacity to pay.\u00a0<\/p>\n Haryana\u2019s deadlock with private hospitals highlights a deeper problem: while PM-JAY has been touted as the world\u2019s largest government-funded health insurance scheme, its rollout across states has been uneven, plagued by delayed reimbursements, under-enrolment of private providers, and allegations of fraud.<\/p>\n And the cracks are not limited to Haryana. In Jammu and Kashmir, where healthcare infrastructure is weaker and private hospitals are fewer, delayed claim settlements and restrictive empanelment rules have left many patients travelling hundreds of kilometres for treatment, sometimes across state lines.<\/p>\n The region has fewer than 130 empanelled private hospitals<\/a> compared to Haryana\u2019s 650.<\/p>\n Months of unsuccessful negotiations<\/p>\n In Haryana, the private hospitals and representative bodies began their refusal to accept members with the government insurance scheme in early August after months of unsuccessful negotiations with the state health department over pending dues, the Indian Medical Association (Haryana) told the Hindustan Times<\/a>.\u00a0<\/p>\n Hospitals say they cannot sustain payroll, utilities, medicine purchases and consumables when reimbursements are delayed for six to nine months.<\/a><\/p>\n Dr Suresh Kumar, a doctor based in Haryana, said private facilities could no longer sustain operations without timely reimbursements.\u00a0<\/p>\n \u201cWe have to pay salaries, electricity bills, buy medicines and consumables \u2014 all on time,\u201d he told Health Policy Watch. \u201cIf the government delays payments for six to nine months, we simply cannot function.\u201d<\/p>\n Hospital administrators also argue that\u00a0 the national Health Benefit Package (HBP) rates for procedures under AB-PMJAY are often outdated and may not match rising input costs.\u00a0<\/p>\n The Health Benefit Package documents list package prices for procedures<\/a>, while the audits show that actual costs for complex surgeries<\/a> frequently exceed package rates in many private hospitals, creating a shortfall for providers<\/p>\n The state health agency, however, has accused some hospitals of inflating bills and submitting dubious claims. Officials say they are conducting audits to weed out fraud before releasing payments, which has contributed to the delays.<\/p>\n Patients in limbo<\/p>\n While the standoff drags on, patients are bearing the brunt.<\/p>\n Ramphal*, a 56-year-old construction worker in the Rohtak district, had postponed a hernia surgery for three months because the nearest government hospital has a waiting list and private options are off-limits.\u00a0<\/p>\n \u201cThe pain is constant,\u201d he said. \u201cBut without Ayushman, I can\u2019t afford the operation.\u201d<\/p>\n For Sunita\u2019s father, the consequences were immediate and severe. The smaller hospital where he was admitted lacked advanced cardiac care, forcing a risky makeshift treatment. The family borrowed from relatives and neighbours, sinking into debt that could take years to repay.<\/p>\n Public hospitals, meanwhile, are reporting a surge in patient load since the suspension, with longer wait times and overstretched staff.<\/p>\n In Jammu and Kashmir, the AB-PMJAY rollout has faced its own hurdles \u2013 even without a mass suspension.<\/p>\n The region, which joined the scheme in December 2018, has only a limited number of empanelled private hospitals, most in the Kashmir Valley.<\/p>\n The majority of private clinics are not part of the programme, citing cumbersome empanel procedures and low reimbursement rates.<\/p>\n Patients in rural districts often travel to Srinagar or even to Punjab for eligible treatments. Delayed claim settlements \u2014 sometimes taking more than six months \u2014 discourage providers from participating.<\/p>\n \u00a0Dr Parvez Ahmad, who runs a mid-sized poly-clinic in Baramulla, said the uncertainty has forced private hospitals\u00a0 to limit the number of Ayushman patients.\u00a0<\/p>\n \u201cThe paperwork is heavy, the payments are slow, and the rates don\u2019t match actual costs,\u201d he said. \u201cWe want to help poor patients, but we can\u2019t run at a loss.\u201d<\/p>\n For patients like 45-year-old Naseema from Kupwara, the gaps in coverage are stark. She was diagnosed with breast cancer last year but had to travel over 100 km to Srinagar for surgery under PM-JAY, a trip that drained her savings and left her physically exhausted.<\/p>\n Fragility of public-private model<\/p>\n Health economists say the twin crises in Haryana and Jammu and Kashmir illustrate the fragility of India\u2019s public-private partnership model in healthcare.<\/p>\n \u201cPM-JAY is heavily dependent on private hospitals, but the government\u2019s purchasing power is undermined when reimbursements are delayed,\u201d said public health expert Dr Indu Bhushan. \u201cWithout a predictable payment system and periodic rate revisions, private participation will keep shrinking.\u201d<\/p>\n The Swiss Re Institute\u2019s analysis<\/a> echoes these concerns, warning that India\u2019s heavy reliance on out-of-pocket payments \u2013 currently about 50% of total health expenditure \u2013 risks reversing poverty reduction gains. It estimates that the health protection gap could reach $200 billion by 2033 if current trends continue.<\/p>\n In Haryana, the government has promised to clear dues by October and review package rates, but private hospitals remain sceptical. In Jammu and Kashmir, officials say they are working to streamline empanelment and speed up claims processing, but no concrete timeline has been announced.<\/p>\n High stakes for Universal Health Coverage<\/p>\n India\u2019s 2017 National Health Policy sets a target of reducing catastrophic health expenditure to 25% of households by 2025. But reality suggests that, without structural fixes to schemes like AB-PMJAY, that goal may be out of reach.\u00a0<\/a><\/p>\n According to a 2024 meta-analysis,<\/a> the pooled incidence of catastrophic health expenditure stands at 30% of Indian households \u2013 5% higher than the 25% policy target.<\/p>\n Moreover, a 2024 study of inpatient healthcare found that 28% of households incurred catastrophic health expenditure<\/a>.\u00a0<\/p>\n On average, inpatient care accounted for 11% of monthly household consumption, underscoring how deeply hospital costs strain family budgets.<\/p>\n While government spending on health is gradually rising, out-of-pocket payments remain stubbornly high.\u00a0<\/p>\n Recent National Health Accounts data shows that government health expenditure rose from 1.13% to 1.84% of GDP between 2014\u201315 and 2021\u201322<\/a>, but still leaves households shouldering a significant burden.<\/p>\n Together, these figures paint a stark picture: the policy target of reducing catastrophic burden to 25% by 2025 is not being met, and public financing remains limited despite slow gains.\u00a0 This means that households are still paying a major share of healthcare costs themselves, raising serious concerns about the financial protection that the scheme offers.<\/p>\n For Sunita\u2019s family, the lofty targets mean little compared to the daily reality of debt and uncertainty. \u201cIf Ayushman doesn\u2019t work, where will poor people go?\u201d she asked.<\/p>\n As the impasse in Haryana continues and patients in Jammu and Kashmir remain underserved, the larger question looms: can India\u2019s flagship health insurance programme truly deliver universal health coverage, or will it remain a patchwork safety net that frays when it is needed most?<\/p>\n *Patients asked for their surnames not to be used.<\/p>\n Image Credits: PMO India<\/a>, Disha Shetty<\/a>.<\/p>\n Combat the infodemic in health information and support health policy reporting from the global South. Our growing network of journalists in Africa, Asia, Geneva and New York connect the dots between regional realities and the big global debates, with evidence-based, open access news and analysis. To make a personal or organisational contribution click here on PayPal.<\/p>\n","protected":false},"excerpt":{"rendered":"Indian Prime Minister Narendra Modi launches the government health insurance scheme in 2018. 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A private hospital in Rohtak, India. Some 650 hospitals in Haryana State have suspended services to government health insurance members over non-payments.<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2025\/08\/IMG20240320115946-1024x768.jpg\")
A rural hospital in Paud in western India.
\nParallel crisis in Jammu and Kashmir<\/p>\n