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India Sees $1.9 Billion Spending on Free Health Care for Poor

Under the National Health Protection Scheme, each family will get a cover of up to Rs 500,000.  

India Sees $1.9 Billion Spending on Free Health Care for Poor
Public Health Foundation of India workers conduct a free door-to-door screening program in Thana kalan, Haryana, India. (Photographer: Prashanth Vishwanathan/Bloomberg)  

(Bloomberg) -- India expects to spend up to 120 billion rupees ($1.9 billion) annually on premium payments to provide as many as 100 million poor families with free access to health care.

The program, which provides poor with hospital care, will be funded with 60 percent contribution from the federal government and rest coming from the states, the National Institution for Transforming India, the government’s think tank known as NITI Aayog, said in a presentation in New Delhi on Friday. The program will be based on either an insurance or trust model, with the states having the flexibility to choose between the two, it said.

The plan, announced by the Finance Minister Arun Jaitley in his budget on Thursday, will provide an annual premium of as much as 1,200 rupees per family, with the beneficiaries not required to pay anything and provide a total cover of 500,000 rupees a year, it said.

The government is looking to address an underfunded public health system and low levels of insurance in a country where about 60 percent of health care expenses are paid out of pocket, putting medical care out of reach for many. As many as 70 million people slip into poverty each year due to ailments, according to the Niti Aayog.

To contact the reporter on this story: Shruti Srivastava in New Delhi at ssrivastav74@bloomberg.net.

To contact the editors responsible for this story: Unni Krishnan at ukrishnan2@bloomberg.net, Subramaniam Sharma

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