Gujarat tops the list as 609 private hospitals exit Ayushman Bharat scheme

New Delhi: Gujarat has recorded the highest number of private hospitals withdrawing from the Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY), with 233 private hospitals opting out since the scheme's launch in 2018.  

The state accounts for nearly 38% of the total 609 private hospitals that have exited the scheme due to issues such as low reimbursement rates, delayed payments, and operational challenges, according to data shared by Minister of State for Health and Family Welfare Prataprao Jadhav in the Rajya Sabha. 

Following Gujarat, Kerala saw 146 hospitals pull out, while 83 hospitals in Maharashtra also withdrew. Other states like Punjab and Chhattisgarh saw 40 and 30 hospitals, respectively, exit the scheme.

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

The AB-PMJAY scheme, which provides health insurance coverage of Rs 5 lakh per family, currently employs 31,805 hospitals across India, of which 14,394 are private sector institutions.

State-wise Hospitals Opting Out of PMJAY:

Gujarat: 233 hospitals

Kerala: 146 hospitals

Maharashtra: 83 hospitals

Punjab: 40 hospitals

Chhattisgarh: 30 hospitals

The withdrawal of private hospitals from the scheme has been steadily increasing over the years. The financial year 2023-24 recorded the highest number of exits, with 174 hospitals pulling out. So far in 2024-25, 41 hospitals have already withdrawn.

Year-wise hospital exits:

2019-20: 83 hospitals

2020-21: 42 hospitals

2021-22: 151 hospitals

2022-23: 118 hospitals

2023-24: 174 hospitals

2024-25: 41 hospitals (so far)

As per a Medical Buyer report, private hospitals have cited several reasons for discontinuing their association with PMJAY, like low packaged rates and delayed payments. 

The ministry in his written reply to the parliament stated that apart from package rates, the reasons for hospitals voluntarily opting out of the scheme include empanelment only for the Covid period, hospitals being closed or non-functional, changes in hospital entity, relocation and shortage of nursing staff and specialist doctors, among others.

“The National Health Authority (NHA) has laid down guidelines for payment of claims to hospitals within 15 days of claims submission for intra-state hospitals and within 30 days of portability hospitals (located outside state),” Prataprao Jadhav said in his response to a query in the Rajya Sabha.

While the empanelment of private hospitals is entirely voluntary under PMJAY, many private and corporate hospitals have highlighted challenges in the scheme’s viability and the need for regulatory reforms to increase private sector participation.

Commenting on the same, an industry source pointed out that corporate hospitals have hesitated to join due to low reimbursement rates and high operational costs.

An industry insider explains that during the initial phase of the scheme, there were about 70 per cent of patients came through cash or private insurance, and 30 per cent were through PMJAY. “It was a model where there was an element of cross-subsidy and hospitals were able to sustain,” he added.

Now, that trend has changed to 70 percent of patients coming through PMJAY, and with low rates and problems related to delayed payment. This is impacting financial sustainability for small hospitals.

An official associated with a Kurukshetra-based PMJAY empanelled hospital said that hospitals are only receiving 10 to 15 per cent of their claimed payments in many cases, with the rest being deducted without giving any reasons. 

“While scrutiny of claims is important, such delays can erode at least 15 to 16 per cent of a hospital’s profit margins,” said another administrator of a Gurugram-based hospital.

Medical Dialogues recently reported that the Ayushman Bharat - Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) has enabled about 8.99 crore hospital admissions, with an overall spending of roughly Rs 1.26 lakh crore up to March 1, 2025 revaled Union Minister of Health and Family Welfare Shri Jagat Prakash Nadda in a written reply to Lok Sabha.

AB-PMJAY provides free healthcare access up to Rs. 5 lakh per eligible beneficiary family annually for secondary and tertiary care hospitalization in 27 medical specialties corresponding to 1961 procedures. Regular updation, such as inclusion of new procedures, empanelment of new hospitals, inclusion of new beneficiaries and other improvements, is done in the scheme as per new requirements from time to time.

Also read- 8.99 crore hospital admissions worth Rs 1.26 lakh crore authorised under PMJAY