Hospital Participation in India’s National Health Insurance Scheme (RSBY)

This study evaluates the response of hospitals to the National Health Insurance Scheme (RSBY) in order to observe how the scheme impacts hospital decisions geared towards capacity.

Despite achieving remarkable economic growth in recent decade, India continues to struggle with public health care access. Over 75% of all health care costs in the country come from out-of-pocket (OOP), pushing 63.2 million Indians into poverty each year. With the aim of providing protection to the very poor from financial liabilities arising out of health shocks that involve hospitalization, the Government of India rolled out its first large-scale public health insurance program called the Rashtriya Swasthya Bima Yojana (National Health Insurance Scheme) in 2008. This study evaluates hospitals’ response to RSBY through a survey of physicians and retrospective data from the administrative records of hospitals, including those not in the RSBY network. It attempts to look at the effect of RSBY on hospitals’ decisions to expand capacity, adopt new medical or non-medical technologies, provide specialized services (or expand the specialties) and on the prices hospitals charge to those paying OOP.
The field study was based in Karnataka, where 9 million of the 300 million potential beneficiaries of the RSBY scheme live. Data was collected from one urban and ten rural districts in the state. The districts which were chosen in order to maximize geographic representation and variation in hospital types. Overall, the sample included roughly 400 hospitals in the ten rural districts, roughly half of which were empanelled under RSBY.
The survey, which was administered in each hospital comprised of two parts. The first part contained questions for the senior-most doctor/physician-in-charge (Doctor survey) and the second part was designed for the administrative staff person (Admin survey). The Doctor survey encompassed questions about the respondent’s educational and professional backgrounds.

The study explores the impact of National Health Insurance Scheme on the approach that hospitals take towards developing facilities, adopting technology as well as pricing schemes for non-insured patients. This study will shed light on obstacles that hospitals face, an insight which will be valuable for RSBY administrators who are looking to make the empanelment process easier. Research findings will also contribute to estimation of a structural model of hospital entry into an insurance network, knowledge on which is sparse. Insights from the study will not only be converted into actionable items and recommendations for policy design and implementation, but also go into improving government services in developing countries.

Thematic Area

Financial Well-being and Social Protection,

Health Systems and Quality of Life

Project Leads

Anup Malani, Sarojini Rao