Ayushman Bharat Faces Setback in Delhi, AHPI Seeks 1 per cent Interest for Payment Delays

New Delhi: With over 1,200 private hospitals operating in the capital, only 19 have enrolled under the Ayushman Bharat Scheme, as many leading and well-known hospitals have opted out, citing key financial concerns.  

Even two months after the official launch of the Ayushman Bharat scheme in Delhi, the response from the city’s private hospitals is underwhelming. The main reasons behind this hesitation are low reimbursement rates and long delays in receiving payments. 

While the government aims to provide accessible and quality healthcare to the population through schemes like Ayushman Bharat, large private hospitals are struggling to align with the fixed reimbursement rates, which apply uniformly across all private hospitals irrespective of their size. 

In many cases, the approved rates are reported to be less than 50% of the operating cost, especially for general and tertiary care procedures. While smaller and some mid-sized hospitals have managed to offer services under the scheme, larger hospitals find it financially challenging due to the expense of their procedures. 

Doctors from leading hospitals said that the money they get under the scheme is far lower than what it actually costs to treat patients. They say that reimbursement rates under Ayushman Bharat are only 30 to 40 per cent of actual treatment costs. These rates are also lower than those of the Central Government Health Scheme (CGHS), which have not been revised since 2014.

To ensure that such hospitals show interest in joining the scheme, the Association of Healthcare Providers of India (AHPI), which represents a large number of private hospitals across the country, wrote a letter to the Delhi Government demanding amendments to the scheme’s terms. The association has urged the government to include a clause for a 1 per cent interest on bills that remain unpaid beyond 30 days. The association believes this will ensure accountability and timely payments.

Also read- Hospital Empanelment Under Ayushman Bharat drops over low rates

Commenting on the matter, Director General of AHPI, Dr Girdhar Gyani, told Medical Dialogues, "The original scheme had this provision of paying 1% interest if payment is delayed beyond a specified period. This clause has conveniently been removed by state governments. We have been raising this issue with the government on numerous occasions. The 1% interest will help the government, as by this, officials will become accountable. In any case, when the government makes an agreement, it should be sacrosanct, and that is why we are demanding this provision. If the government can provide timely payment, many mid-size hospitals may come forward to join the scheme."

When asked about the exact reason for the hesitation, Dr Gyani said, "As we know, the private sector has about 60% of the total beds. Even more important is that 85% of tertiary care beds are in the private sector. While the government, in all good intention, is keen to provide healthcare to the population at large through schemes like Ayushman Bharat, it does not have the infrastructure and has to depend upon the private sector."

"In a way, it sounds good, PPP, but the fact is that the government has not done any scientific study to arrive at reimbursement rates for various procedures and these have been fixed more on an ad-hoc basis. Many of the rates are found to be less than 50% of the operating cost in general and for tertiary care procedures in particular. In such a scenario it is loss making proposition for hospitals to join scheme and hospitals avoid being part of it," he said, adding that although the agreement promises payments within 15 to 30 days, in reality they are delayed, disrupting cash flow and making it impossible for hospitals to sustain operations under the scheme.

Responding to a question about the government's reason for maintaining fixed rates for all private hospitals, Dr Gyani said, "Firstly, the government has not done any scientific study. Secondly, with 1.5% of GDP being investment, it may be difficult to increase allocation. For example, in the case of CGHS, rates were fixed in 2014, and it has been more than 10 years since rates have not been revised. In fact, the Minister of State had announced that rates have been revised, but for reasons best known, these have still not been released. Till, scientific study is done, the government can at least revise rates every year by applying inflation, the way it is done for revising DA for government employees. These are reasons that no new hospitals are coming up in deficient regions like Tier-III towns, and without which we will continue to have poor accessibility of healthcare services.

Similarly, Dr Narin Sehgal, owner of Sehgal Neo Hospital and Secretary of the AHPI’s Delhi Chapter, told Medical Dialogues, "The scheme is good, but the rates are quite low. Large hospitals have high operating costs. Therefore, with the low reimbursement rates, it won't be possible to proceed further with the procedures through the scheme. Delayed payments, along with heavy documentation and technical issues, make things difficult. There's a lack of trust - the payment release process needs to be smoother, and rates should be reconsidered."

Also read- Rs 1.21 lakh Crore claims pending under Ayushman Bharat, reveals RTI