Over 600 Private Hospitals Exit AB-PMJAY; Gujarat Leads Opt-Outs

The AB-PMJAY, which provides health coverage of INR 5 lakh per family, currently has 31,805 impaneled hospitals, including 14,394 private facilities. Over 600 private hospitals have withdrawn from the Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) since its launch in 2018, citing financial constraints due to delayed payments and low reimbursement rates.

Gujarat recorded the highest number of exits at 233, followed by Kerala (146) and Maharashtra (83), according to data presented by Minister of State for Health Prataprao Jadhav in the Rajya Sabha.

The AB-PMJAY, which provides health coverage of INR 5 lakh per family, currently has 31,805 impaneled hospitals, including 14,394 private facilities. However, concerns over the scheme’s financial viability have led to many private hospitals opting out.

Financial Strain on Private Hospitals

Hospitals participating in AB-PMJAY have expressed concerns over low package rates and reimbursement delays, which they say impact operational sustainability. Girdhar Gyani, Director General of the Association of Healthcare Providers of India (AHPI), stated, “Some facilities, particularly in tertiary care, are struggling due to reimbursement delays and low payment rates, which directly affect their financial sustainability.”

The issue is further exacerbated by hospitals receiving significantly lower amounts than their claimed reimbursements. An administrator of a Gurugram-based hospital highlighted the financial losses, stating, “While scrutinization of claims is important, these deductions often erode 15 to 16 percent of a hospital’s profit margins.”

Data presented in the Rajya Sabha also revealed that 609 private hospitals have opted out of the scheme since 2018. Opt-out numbers have fluctuated over the years, with 174 hospitals exiting in 2023-24 alone.

Additionally, many hospitals had joined the scheme temporarily during the COVID-19 pandemic and later withdrew.

Industry Demands Transparent Payment Mechanism

Private hospital associations have repeatedly raised concerns about payment delays and lack of reimbursement transparency.

Last month, the Indian Medical Association (IMA) Haryana unit suspended its AB-PMJAY services, citing ₹400 crore in pending reimbursements. Similar protests have been witnessed in Punjab and Jammu & Kashmir.

Hospitals in states like Gujarat and Chhattisgarh have also expressed dissatisfaction over restrictions that reserve certain treatment packages for public hospitals, further limiting their participation.

Industry representatives have suggested measures to improve the scheme’s feasibility, including timely reimbursements and cost recovery for private hospitals. Gyani noted that “Introducing a clause of 1 percent interest on delayed payments beyond a month could improve financial sustainability for impaneled hospitals.”

In March 2024, the government formed a high-level committee, chaired by NITI Aayog member VK Paul, to assess challenges in PMJAY implementation. To sustain participation, private hospitals have proposed clearer payment commitments, real-time claim tracking, and better cost coverage. However, the committee’s recommendations are still awaited.

With private hospitals accounting for a significant share of tertiary care beds in India, stakeholders emphasize that addressing these concerns is crucial to ensuring continued private sector participation in AB-PMJAY.