Reaping the Silver Dividend: Elderly Healthcare in India (GS Paper 2, Government Policies)
Context
- The Indian government has extended the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) to include a ₹5 lakh top-up for elderly adults aged 70 and above.
- This move aims to enhance healthcare access and financial protection for a rapidly aging population, but it raises concerns about its adequacy and limitations in promoting healthy aging.
About Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY)
- Launched in February 2018, AB-PMJAY is the world's largest publicly funded health assurance scheme, providing ₹5 lakh in coverage per family annually for secondary and tertiary care.
- It covers a wide range of medical treatments and hospital expenses, currently benefiting around 55 crore people across 12.34 crore families.
- The scheme has facilitated 7.37 crore hospital admissions, with nearly half of the beneficiaries being women.
Expansion of AB-PMJAY
- The recent extension to older adults reflects the government's recognition of their unique healthcare needs.
- However, while it is projected to assist 4.5 crore families, many elderly may still face catastrophic healthcare expenditures (CHE), indicating a need for a more comprehensive approach to financial protection.
Aging Population and Healthcare Needs in India
- India is experiencing rapid aging, with a life expectancy of around 70 years but a healthy life expectancy of only 63.5 years.
- The increasing prevalence of non-communicable diseases (NCDs) among older adults necessitates robust healthcare coverage.
- Currently, only 20% of those over 60 have health insurance, highlighting a significant gap, especially given the high costs of private insurance.
Financial Implications and Coverage Gaps
- The government's allocation of ₹3,437 crore for the AB-PMJAY extension appears insufficient.
- Projections indicate that approximately 5.6 crore households are eligible, but the scheme's reach may only cover about 43.5 lakh families after accounting for those already insured.
- With average hospitalization costs estimated at ₹32,804, the scheme would require ₹14,282 crore annually—four times the current funding.
Challenges in Addressing Elderly Healthcare Needs
The AB-PMJAY's limitations include:
- Exclusion of Outpatient Care: Vital for preventive health, outpatient services constitute 46% of total health expenditures and are not covered by the scheme.
- Focus on Secondary and Tertiary Care: This neglects the ongoing healthcare needs of elderly individuals, particularly those with chronic conditions.
- Inadequate Support for Long-term Care: Many older adults require frequent consultations and long-term care, which the current framework does not address.
Holistic Reforms for Healthcare Systems
- While extending AB-PMJAY is a necessary step, it alone cannot meet the healthcare demands of the aging population.
- Public healthcare spending in India remains low, stagnating at around 0.9% to 1.35% of GDP.
- In contrast, countries with better healthcare outcomes invest substantially in public health as a human capital issue.
Conclusion: The Need for Comprehensive Reforms
- The extension of AB-PMJAY is an important intervention to mitigate the financial risks of healthcare spending among the elderly, yet it falls short of ensuring their overall well-being.
- As India undergoes significant demographic transitions, the healthcare model must evolve to support healthy aging.
- To reap the "silver dividend"—the economic and social contributions of the older population—India needs a holistic healthcare approach integrating primary, secondary, and tertiary care.
- This includes addressing outpatient services, increasing public health funding, and ensuring that healthcare systems are prepared for the challenges posed by an aging society.
- By fostering an environment that supports healthy aging, India can create a more inclusive and sustainable healthcare landscape for its elderly citizens.
