Ayushman Bharat has faced criticism for its inadequate funding, low hospital bed availability, and insufficient support for the most marginalized communities. Despite government claims of success, many beneficiaries experience high out-of-pocket expenses and financial exploitation, revealing significant gaps in the program’s efficacy.
Launched in September 2018, Ayushman Bharat, the Prime Minister’s National Health Insurance Programme, aims to provide health coverage and prevent what the government describes as “catastrophic” health expenditure that drives millions of Indians into poverty each year. Official statistics indicate that approximately 60 million individuals fall into poverty due to healthcare costs annually. However, the program has faced significant criticism regarding its efficacy and actual impact on the most marginalized communities in India. Despite claims of success from government officials, including Vinod K Paul from the Niti Aayog, who cited anecdotal evidence of beneficiaries receiving substantial payments exceeding Rs 100,000, data supporting these assertions is lacking. Studies indicate that Ayushman Bharat has not effectively met the healthcare needs of underserved populations and that beneficiaries are often subjected to financial exploitation by private hospitals.
New survey highlights old problems
Recent findings from a 2024 survey conducted among low-income families in Bengaluru revealed that nearly half of all Ayushman Bharat beneficiaries had to seek additional loans from moneylenders at exorbitant interest rates, further indicating the program’s limited effectiveness in alleviating financial burdens. The financial allotment for the scheme in the 2025 budget stands at Rs 9,406 crore, a figure substantially lower than what would be required to adequately support the expected demand from beneficiaries. Estimates suggest that if 10% of the projected 600 million beneficiaries were to utilize the scheme, with claims averaging Rs 50,000 each, the government would need to allocate approximately Rs 300,000 crore to the program, of which Rs 180,000 crore would need to be provided by the central government.
Unless the government invested in public health care, regulated private healthcare and enabled affordable medicines, experts argued, the PMJAY would not help the majority of the people it was meant to and stem the plunge into poverty it was meant to prevent.
Data collected between 2018 and 2023 from the PMJAY dashboard indicates that only 1.1% of beneficiaries—approximately 328,000—received payments exceeding Rs 100,000. This contrasts sharply with the significant demand that has arisen since the scheme’s initiation. The number of hospital beds available in empaneled hospitals has not kept pace with this demand. Official reports estimate around 1.33 million hospital beds available in nearly 28,000 empaneled facilities, a significant shortfall given the widespread need for healthcare services across the nation. The provision of hospital beds per thousand population remains dangerously low at approximately 0.75, far below the two beds per thousand recommended standard.
The Indian government allocates a mere 1.35% of its GDP to healthcare, one of the lowest in the world, contrasting sharply with low- and middle-income countries that invest about 6% of their GDP for public healthcare. This funding gap has led to a reliance on private healthcare, pushing Indians to spend disproportionately more out-of-pocket compared to other nations.
The Ayushman Bharat Revamp?
Ayushman Bharat comprises two complementary components: a cashless health insurance scheme for the economically disadvantaged that covers up to Rs 500,000, and the establishment of 150,000 health and wellness centers aimed at delivering primary care. Although government reports claim that out-of-pocket expenditure has decreased from 69% in 2013 to 39% in 2021, questions remain regarding the true impact of Ayushman Bharat in reducing financial burdens. Notably, the program does not cover outpatient costs, which can often represent the majority of healthcare expenditures for households, further complicating financial management for families in need. Critics point out that the PMJAY platform has shown a lack of transparency, selective data reporting, and the absence of independent evaluations, making it difficult to draw concrete conclusions about the program’s effectiveness in reducing out-of-pocket expenditures.
In April 2024, a health survey funded by the Azim Premji Foundation gathered data from over 1,000 low-income families in South Bangalore. The results illustrated a complex health insurance landscape where only about 20% of households had some insurance coverage, with over 12% utilizing the state-integrated Arogya Karnataka Health Scheme as part of the PMJAY. The average hospitalization expenditure reported by families who had received coverage through Ayushman Bharat was approximately Rs 79,000, yet claim data indicated beneficiaries received an average of less than Rs 10,000 from empaneled hospitals. This discrepancy leaves households with nearly Rs 70,000 in out-of-pocket expenses, a substantial financial burden that many families struggle to manage. The financial implications of healthcare in India are compounded by high borrowing costs. The survey indicated that about 75% of families who reported hospitalization utilized loans to cover medical expenses, revealing the paradox of a health insurance scheme that is intended to shield individuals from catastrophic costs but ultimately forces them into debt.
In summary, Ayushman Bharat demonstrates the government’s attempt to provide universal health coverage; however, the reality suggests that it has not fulfilled its promises for many of India’s most vulnerable populations. The presence of inadequate funding, insufficient healthcare infrastructure, and high out-of-pocket costs starkly contrasts with the government’s optimistic portrayal of the program’s success. Moving forward, a transparent reassessment of the Ayushman Bharat scheme, increased investment in healthcare infrastructure, and a systemic approach to manage the financial barriers faced by marginalized communities will be essential for achieving the intended goals of health equity and universal coverage in India.
