Ayushman Bharat’s New Senior Cover Helps, But Out-of-Pocket Gaps Remain

The Ayushman Bharat–Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) offers Rs 5 lakh annual coverage per family for secondary and tertiary healthcare. According to media reports, eligible families can now extend this limit to Rs 10 lakh. This is due to a special top-up introduced for senior citizens aged 70 and above.

Extra Rs 5 Lakh Pool Reserved Only For Seniors

Everyone is not automatically eligible for the base Ayushman Bharat cover. The original Rs 5 lakh family floater is still targeted: it covers roughly 12.3 crore poor and vulnerable families identified from SECC 2011 and related databases. 

The new senior-citizen benefit (Ayushman Vay Vandana) is universal by age: all Indians aged 70+ are eligible, irrespective of income or whether they are below or above the poverty line. Aadhaar-based age verification and e-KYC are mandatory.

“For such families, the structure is Rs 5 lakh for the existing PM-JAY family cover (husband, wife, children, and other dependents) and an additional Rs 5 lakh ring-fenced only for 70+ members; younger members cannot draw from this pool,” says Narendra Bharindwal, president, Insurance Brokers Association of India (IBAI).

PM-JAY today has a wide package list covering common age-related procedures—cataract, hernia, TURP, hysterectomy, hip and knee surgeries, angioplasty, bypass surgery, stroke interventions, etc. Many of these are already being used under the senior citizen window.

“For standardized, protocol-driven interventions of short or moderate length of stay, package rates are reasonably aligned with costs in a large segment of public and mid-tier private hospitals. For these, seniors get genuinely cashless treatment with minimal or no top-up from their side,” says Bharindwal.

Rs 10 lakh Helps, But Gaps Remain For Elderly

“The rates for packages under Ayushman Bharat have not kept pace with inflation in terms of medical devices, implants, and consumables. For seniors, that gap becomes even more evident because their hospitalizations tend to both be longer and require more complexity,” says Arun Ramamurthy, co-founder, Staywell.Health.

For cases of joint replacements, the use of stents and other procedure-heavy devices, and the prices of devices, exceed what package provisions will allow. ICU, ventilator, and multi-specialty care will most often incur additional costs for the same reason—providing comparable care in a private hospital might incur an increase of 20–40 per cent over package rates.

There are some blatant exclusions of non-medical consumables, which seniors will need at a much higher rate than other populations.

“Taking all of that into account, while moving to Rs 10 lakh is a significant and positive step, it does not entirely eliminate the insurance gap for the elderly,” says Ramamurthy.

Next, there will need to be more rationalization of packages and differential package pricing for geriatric cases and diagnostic workup prior to hospitalization to reduce out-of-pocket costs meaningfully.

Says Sarita Joshi, head of health and life insurance, Probus: “The increased Rs 10 lakh maximum benefits for senior citizens under Ayushman Bharat is a constructive and appreciated first step toward fewer family financial burdens and reducing out-of-pocket expenses. Many older patients are receiving treatment for chronic or age-related ailments, in which costs can rapidly multiply, and more insurance coverage serves to reduce overall financial impact.”

“Although increased benefits are a good development, concerns about costs will always linger as expenses related to consumables, room costs that exceed the facility's hospital plan, and other areas for follow-up are not covered. Ayushman Bharat is a kind of service provided by the government panel authorities, and it doesn't work with cashless or reimbursement. The hospital will coordinate with government staff to recover the claim amount,” adds Joshi.