Budget 2018: The Healthcare Umbrella

Healthcare Budget 2018

Union Budget 2018 is the first since the government implemented major economic and structural reforms, including the Goods and Services Tax (GST). This is also the last full Budget of the government led by Prime Minister Narendra Modi before the country goes votes in the 2019 general election.

Finance Arun Jaitley announced two new programmes under the aegis of Ayushman Bharat. The first is to set up 1.5 lakh healthcare centres across India. The other is the National Health Protection Scheme (NHPS), which will cover 10 crore poor and vulnerable families, providing them Rs 5 lakh per annum, per family for secondary and tertiary purposes.

Mr Jaitley said: “We are now launching a flagship national health protection scheme to cover 10 crore poor and vulnerable families. This is approximately 50 crore beneficiaries, by providing them up to Rs 5 lakh per family per year for secondary and tertiary care hospitalisation”.


  • Ayushman Bharat: 1.5 lakh centres will be set up to provide health facilities closer to home. These centres will provide comprehensive healthcare, child services, maternal care and treatment of non-communicable diseases.
  • Rs 1,200 crore will be allocated for the above programme. It will also include free essential drugs and diagnostics.
  • Flagship National Health Protection Scheme: Approximately 50 crore beneficiaries. Up to Rs 5 lakh per family, per year for secondary and tertiary care hospitalisation.
  • Rs 600 crore allocated for tuberculosis patients, at the rate Rs 500 per month during the course of their treatment.
  • Setting up of one medical college for every three parliamentary constituencies, with 24 new government medical colleges to be set up by upgrading district hospitals in the states.

These announcements are nothing but good news for those who struggle for basic healthcare and often find themselves overcharged at private hospitals. It would also appear that recent reports of such overcharging as well as the gap between private and state healthcare costs mapped by the Economic Survey have been taken into account by the Budget.

Again, a joint study by KPMG India and FICCI, covering 219 MSMEs across 15 manufacturing and services sectors, which analysed worker welfare in terms of healthcare coverage, had reportedly stated that 90% of MSMEs did not have financial provisions for medical facilities for family members of employees. What the Budget announcement means is that informal sector workers will now get healthcare coverage.

Historically, India has not spent what international institutions like the World Bank would consider a substantial amount on healthcare. With this, reportedly the world’s largest state-funded healthcare scheme, India has substantially extended the welfare and social security net.