Over the past 50 years, Indian public health policy and administration has been mainly focused on family planning, immunization and specific disease eradication programmes. Programmes such as the oral polio immunization scheme are given high publicity in the media (often driven by the agenda of global agencies). However, there has been a silence in the media over the widening gap of availability of quality curative care in the healthcare system. It is common knowledge that 80% of healthcare expenditure in the country is borne by the sick person as out of pocket (OOP) expenditure. The complete deterioration of clinical care at the primary health centres (PHCs) is only one indication of a much larger governmental trend. It was in this scenario of poor quality medical care that the Rajiv Aarogyasri programme was launched in 2006 by the then Congress chief minister Y.S. Rajasekhar Reddy in Andhra Pradesh. It was promoted as a promise to provide the best quality scientific medical care to the poor. It has since been projected as a landmark programme, winning accolades from the World Bank, and drawing international financial speculators. It has also succeeded in convincing the electorate that such a step in health care is both possible and necessary. This article tries to provide the reader with the historical origin of the programme, its basic structure and its limitations.

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The politics of healthcare in Andhra Pradesh

We trace the Aarogyasri programme to a series of events that were selectively highlighted by the Andhra Pradesh (AP) government to build an orchestrated consensus for the project. The Jayati Ghosh Committee (2006) report on economic distress in the agricultural sector described the precarious condition of the farmers. In its chapter on health and nutrition, the report discussed the poor health indicators, the failure of the public health system, and the cost of privatized care, that were contributory factors to farmer indebtedness, distress and suicide. It recommended that, “…immediate attention of the government should be on enforcing the provision of free care to the poor by the private hospitals, which have benefited from financial incentives, land grants, etc.”

It is possible to speculate that this specific recommendation of the report was a convenient support to Y S Rajasekhar Reddy’s scheme to provide healthcare for all through corporate hospitals. While there was a lack of adequate healthcare for the poor in AP, there was at the same time also uncontrolled growth of corporate hospitals. How did this happen?

From the mid 1970s onwards, there has been a strong presence of the post-green revolution entrepreneurial castes from AP in the lucrative medical profession in the US. These groups had the know-how and also a deep cultural attraction for sophisticated western science and technology. It is possible to link the presence of these groups to the establishment of private/corporate hospitals in Andhra Pradesh. By the 1980s, Hyderabad and Andhra Pradesh became major hubs of medical diagnostics (Vijaya Diagnostics and Medinova were pioneers) and healthcare (Apollo, Care, Medwin and Yashoda are the foremost examples). These private institutions began to provide ‘world-class’ super-specialty diagnostic and therapeutic procedures (indeed, also in the process trying to become a key destination for global medical tourism). In privatized medical care in India, there is no standardized treatment for diseases, nor are there any quality assurance agencies. All these resulted in a small, but powerful group of corporates taking full control of advanced medical care. These super-specialty hospitals formed cartels to keep prices artificially high.

When Rajasekhar Reddy proposed his scheme, these hospitals were willing to accommodate the poor provided the costs were borne by the State. This state-insured business would surely help fatten their financial bottom lines.

From the year 2004 onwards, the political conditions were ripe for the introduction of some innovative health measures in AP. The newly elected chief minister (who was a qualified medical doctor) had a long-lasting interest and financial commitment to healthcare. Between May 2004 and June 2007, Rs 168.52 crore were spent from the Chief Minister’s Relief Fund to help 55,362 below poverty line (BPL) patients requiring hospitalisation. However, this aid was ad hoc, and given to those who had the resources and connec­tions to tap into it. In addition, the patient had to spend a lot before availing this CM Relief Fund. Therefore the purpose of providing this money to avert a debt trap for the patients was not effectively met.

In 2006, Manda Krishna Madiga, one of the founders of the Madiga Dandora movement, undertook a padayatra to highlight the problems of young children with heart ailments. Shocking media visuals depict­ed parents carrying sick children on the city streets in the peak of summer, and they led to a focus on heart problems among the children of the poor. About 4600 such children’s names were listed. Soon after, Rajasekhar Reddy announced free heart surgeries for these children and by August 2006, op­erations (it is not clear how many) were carried out under the Chief Minister’s Relief Fund. It must be noted at this point that most of the children had preventable health problems such as rheumatic heart disease, or issues that could be taken care of in the long run through education (for instance about the link between congenital heart problems and consanguineous marriages). None of these contributory factors, preventive measures or health education strategies were discussed, but the magnanimous gesture of funding the heart operations on children set the stage for the Aarogyasri programme. The point to be noted is that Rajasekhar Reddy’s political astute­ness and understanding of healthcare were important factors that led to this scheme. In addition, he also needed ways to guarantee his re-election in the coming polls.

As we shall discuss, the programme by design does not address primary or secondary level healthcare requirements, which are relegated to the public sector. In fact, Aarogyasri’s focus on tertiary healthcare to the exclusion of all other forms of medical assistance has lead to an inefficient medical care model. This model does not meet the health care needs and has low impact on meeting the felt needs of healthcare and on the overall health of the population. At the same time, the enthusiastic popular reception of the programme has to be taken note of.

Rajiv Aarogyasri Scheme (2006)

The scheme aims to provide medical care for BPL families up to a value of Rs 2 lakh per year. This is for tertiary surgical and medical treatment of serious ailments. The stated aim is to help them avoid a debt trap. The scheme is run by a public-private partnership called the Aarogyasri Health Care Trust (AHCT, hereinafter the Trust) between the corpo­rate hospitals and state agencies. The Trust has a supervisory role and it also ensures that the government departments help in implementation. It provides this care through an established network of corpo­rate hospitals, 50 + bedded private hospi­tals, government medical colleges, district hospitals and area hospitals (and yet the programme has al­most no role for the PHCs). The beneficiaries are the members of BPL families as enumerated and identified by the Rajiv Aarogyasri Health Card/BPL Ration Card. (The definition of BPL families for the Aarogyasri programme differs from that used nationally, and includes 80% of the population).

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Each family is allowed a total reimbursement of Rs 1.50 lakh per annum availed individually or collectively and a buffer of Rs 50,000 meets expenses exceeding Rs 1.5 lakh (up to Rs. 6.50 lakh in cochlear implant surgery and auditory-verbal therapy). There are a total of over 950 procedures that are covered under this scheme.

Some of these procedures have been recently earmarked for the government hospitals. The healthcare transaction is cashless at the point of service. Basic outpatient department (OPD) examination of potential cases is supposed to be free. Some diagnostic procedures to establish whether the condition or proposed interven­tion is in the eligible list (even if they do not result in the patient undergoing any treatment under Aarogyasri) are supposed to be free. Network hospitals, i.e., corporate hospitals, are expected to conduct at least one free medical camp in a week, to screen patients in villages. The entire operational database including all transac­tions is paperless, real-time and online.

In theory, all the PHCs and area/district hospitals are the usual first contact points for the majority of the beneficiaries. Aarogyamitras (qualified graduates appoint­ed by the Star Health and Allied Insurance Company) are responsible for “hand-holding” patients lacking the confidence and the knowledge to engage with the care pro­viders. In this handholding role, the Aarogyamitras func­tion without checks and restraints from the local health administration since they are not accountable to them. There is anecdotal evidence of Aarogyamitras diverting cases from government hospitals (and even medical colleges) to private hospitals. Thus, in practice, these Aarogyamitras control the process of referral.

Structural Features

Focus on Tertiary Care

The Aarogyasri programme is designed for advanced sur­gical and medical care. When the system was first implemented, this care was avail­able only in corporate hospitals and medical colleges who had been empanelled in the scheme. However, in the second and third year of the programme, the list has been expanded to include smaller private hospitals and secondary government hospitals. The corporate hospitals continue to handle the biggest share of the Aarogyasri cases. There is no provision for outpatient treatment of everyday illnesses that affect the working capacity of the patient. This lack of early management of illnesses also often results in complications that are handled in the programme at a higher cost. In effect, the focus on specialty care results in a suboptimal use of healthcare funds. For example the list covers surgical treatment of gastric perforation, but does not cover gastritis and gastric ulcer, which in some cases are an earlier stage requiring simpler and cheaper medical treatment. Earlier and simpler treatment would have averted the need for surgical intervention.

Medicine Costs

Originally, the post treatment medication costs were covered only for a period of 10 days. Since about a year now, this coverage has been increased to one year. Research indicates that the cost of medications for in-patient treatment is more than 40% of the total cost of treatment. For complex procedures that may require lifelong medical support, one year’s support is clearly inadequate and will need to be increased through some suitable mechanism.

Procedure-Driven

It is an accepted fact that when health insurance schemes are planned, costing the treatment of each illness covered is essential to ensure rational and effective functioning. For this, the average duration of illness, the duration of hospitalisation, and a list of the investigations required are essential information. None of this information was available for the population in AP – in fact even the disease burden and morbidity profile of the BPL populations were not accurate. This “technical problem” was not of consequence to the Aarogyasri programme since it is simply designed on the basis of the cost of the procedures of surgical or medical intervention available at those corporate hospitals empanelled in the scheme. In other words, the programme subsidises the working costs of advanced equipment in corporate hospitals through the provision of patients who are supported by the insurance programme. Ideally the payment should be done for disease conditions rather than procedures so that hospitals have an incentive to provide the most cost effective treatment. As it stands, the scheme tends to provide (often unnecessarily) exorbitant treatment based on advanced equipment and technology.

There are three consequences to this unusual route of cost determination:

One, since the focal point is the medical or surgical procedure, there are no prescribed methods to determine the best way of treating the patient, and to determine whether the patient actually needs the procedure. There is only one thing to determine, once the procedure is decided upon, whether the hospital follows the standard method for that procedure. Thus, in January 2010, it was discovered that several hospitals in the smaller towns in the state were performing unnecessary hysterectomies to benefit from the Aarogyasri largesse. The government has cracked down on this and has instituted regulations. However, the case of unnecessary hysterectomies is only one example of the possibilities of unnecessary surgical interventions that lurk on the horizon.

Two, as we have already noted, the procedures approved are often high cost interventions when compared to their less expensive conventional counterparts. For instance, gastrointestinal cases are funded for high cost laparoscopic (keyhole) surgeries rather than for the more conventional and cheaper abdominal surgeries; laparoscopic appendicectomy is funded rather than conventional appendicectomy, the only advantage of the former being the avoidance of a two-three inches scar. Here it is important to note that conventional care has better penetration in rural/quasi-rural institutions compared to advanced high cost care which is sustainable only in metros and big cities. Hence, an insurance funding mechanism that covers only high cost procedures will bias the medical system towards an urban-centric specialty system and against a broader distribution of medical care throughout the state. It also restricts the local availability of treatment (as only advanced treatment is covered under Aarogyasri) in rural and remote areas.

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Three, the cost of the procedure is determined at the beginning of the programme based on the costs prevalent at that time. The reduction in the cost of the procedure due to the increased patient base provided by Aarogyasri is not accounted for, leading to a profitable enterprise for the hospitals at the cost of state funds.

Health Impact

One of the difficult questions that the Aarogyasri programme raises is about the health impact it has on morbidity and epidemiological profile. While it is designed to take care of catastrophic expenditure due to serious illness, it leaves us wondering about how effective it is in improving the general level of health of people. How does one measure this, and how do we measure the relative effectiveness of treatment and prevention strategies? How do we decide on a health care strategy in situations where there is widespread morbidity on the one hand, and the need for sharply defined acute medical care on the other? For example, in 2009, the widespread outbreak of dengue fever resulted in the then Chief Minister Rosaiah declaring that dengue would be treated under Aarogyasri, only to be contradicted the very next day by the Aarogyasri minister, Satyanarayana on the grounds that it was not included in the list of 950+ treatments covered under the programme. The problem is that dengue needs focus at both the preventive and the curative level. The failure of the former and the refusal of the latter are together symbolic of the complete capitulation of healthcare priority to corporate hospital interests – with disastrous results that border on it becoming a medical atrocity.

No Focus on Epidemics and Region Specific Morbidities

One of the problems of the Aarogyasri programme is the lack of a comprehensive disease management protocol; but the other problem is that it has become impossible to bestow recognition on a disease as deserving attention if it does not fall within the list of problems covered under Aarogyasri. Thus, any disease that does not fall under the tertiary care profile, like malaria, typhoid, cholera, respiratory diseases, is neither visible as a disease nor does it qualify for a procedure. If this tertiary care driven system becomes the sole engine of health care (as it is increasingly threatening to be), it would not allow us to recognize/treat the ailments of a large population that has no access to healthcare. It forecloses the possibility of any indigenous research about diseases that are not epidemiologically important in the west, but are crucial in our conditions.

Conclusion

The Aarogyasri scheme has been revolutionary in placing health on the political map in the state. It is a major landmark in India’s administrative approach to health and has emerged as a popular scheme among the masses. It has given hope to multitudes where none existed. However in its current form, the programme is a means to fund corporate hospital profit and distorts the pattern of healthcare in the state. A re-examination of the Aarogyasri programme is urgently necessary, especially in the context of its emergence as a possible model for universal healthcare.

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