Center for Health Market Innovations (CHMI)

Programs

Aarogyasri Community Health Insurance Scheme

last updated Oct 3, 2011

Overview

Implementing organization: 
Aarogyasri Health Care Trust
Legal Status: 
State/government
Year Launched: 
2004
Stage: 
Existing/expansion stage
Income Level of Target Population: 
Bottom 20%

Funding

Primary Source of Funding: 
Government

Scale

Number of Clients Served: 
65 million people
Number of Facilities Operated/Networked: 
Public providers: 98, private providers: 244
Summary: 

The objective of the Aarogyasri Communiy Health Insurance Scheme is social protection, addressing healthcare problems that cause indebtedness and often bring people into devastating financial and physical distress. Indebtedness due to hospital expenditures is one of the main reasons for people falling into poverty in the state.

Click here to read a full case study from the Joint Learning Network (JLN) for Universal Health Coverage.

Key program components: 

In order to facilitate effective implementation of the scheme, the government set up Aarogyasri Health Care Trust under the chairmanship of the Chief Minister of Andhra Pradesh. The Trust—in consultation with specialists in the field of insurance and other medical professionals— devised the tailor made Aarogyasri health insurance scheme. The Trust includes representatives from various government agencies and professional organizations.

Aarogyasri is a state‐funded health insurance scheme for below‐the‐poverty‐line citizens in Andhra Pradesh, India. Catastrophic (inpatient) care is provided primarily by private providers (the network does include some public facilities, but the majority of the network providers remain private facilities), and administrative services are provided by a private insurer. Aarogyasri beneficiaries have access to facilities they would not otherwise be able to utilize due to the financial barriers to access.

Aarogyasri is funded by general tax revenue generated by the state of Andhra Pradesh. The state subsidizes the full cost of the insurance premium for each beneficiary. The state chose to fully cover this cost as the administrative costs of collecting the premium would outweigh the total cost of the premium itself. In addition, the state wanted to ensure that the benefits of the scheme reached the poorest, who might otherwise be deterred from enrolling even if the premium to be paid out-of-pocket was nominal.

For rollout of Aarogyasri, the State government engaged in an open, competitive bidding process to select a single insurer to implement the program. The insurer with the lowest premium bid (for the specified benefits package) won the contract to be the insurer for Aarogyasri. For the first phase of Aarogyasri, the premium was set at Rs.210 (US$4.50) per household annually, with each household entitled to claim all expenses in relation to a set of pre-specified critical diseases and surgeries up to a maximum of Rs.200,000 (USD4,440). The premium is the same across all districts in the state and the amount reimbursed per procedure to any network hospital is also the same.

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