The Maharashtra government has made a noteworthy decision by terminating its Rs 3,000 crore agreement with United India Insurance (UII), which was in charge of carrying out the redesigned Mahatma Jyotiba Phule Jan Arogya Yojana (MJPJAY). According to rumours, the Eknath Shinde-led administration has opted to fund universal health care directly, bypassing the insurance industry. The state pays the remaining portion of the premium; the Centre provides around 60% of it.
After 12 years of operation under the old plan, the state government made a fundamental shift in managing medical claims by switching from the Insurance Model to the Trust Model. With effect from September 14, the government will handle the direct settlement of these claims. Prior to this, United India Insurance was in charge of the cashless program and handled the claims settlement procedure for residents’ medical care. Nevertheless, the Maharashtra government cancelled the agreement due to the insurer’s subpar performance.
The Mahatma Phule Jan Aarogya Yojana’s CEO, Ramesh Chavan, stated that the insurance company’s inadequate reaction was the reason behind the contract’s termination. “The corporation was supposed to pay Rs 93 crore in performance bank guarantee after we signed the contract in June, but they failed to do so. In addition, the firm was withholding payment as a result of the rise in claim amounts from the previous year, and the hospital began to complain to us often.
The Maharashtra government launched a redesigned Mahatma Jyotirao Phule Jan Arogya Yojana (MJPJAY) health insurance scheme in the most recent state budget, and it went into effect on July 1. This most recent effort provided all state citizens, regardless of economic levels, with a maximum coverage of Rs 5 lakh for cashless medical treatment. About 2.72 crore households are covered by the updated MJPJAY, which also gives them access to 1,900 hospitals, 1,450 of which are private healthcare institutions.
With respect to the new universal health coverage, the state set a premium of Rs 1,300 per household for about 2.38 crore families, or 12.3 crore people in total. Over Rs 3,000 crore worth of insurance premiums were paid to UII in total. The family coverage has been increased to Rs 5 lakh from Rs 1.5 lakh, which is noteworthy.
Up to Rs 1.5 lakh each family was covered by UII; State Health Assurance Society (SHAS), a state institution, was in charge of managing the remaining sum. The goal of the comprehensive health coverage program known as MJPJAY 2.0 is to provide universal access to healthcare to all qualified citizens of the state who have a valid ration card and domicile certificate.
First introduced in 2020, this program targeted the most economically disadvantaged groups in society, guaranteeing statewide coverage. Through a network of healthcare providers from the public and commercial sectors, it provides seamless, cashless healthcare services for certain conditions. A yearly insurance premium of Rs 797 per household was sent under the auspices of the State Health Assurance Society (SHAS), totalling around Rs 1900 crore annually in total. Over the previous four fiscal years, this amount was paid to the United India Insurance business in quarterly instalments.
