Page 11 - Insurance Times August 2018
P. 11
Health Insurance
News
NHPM scheme: Apollo Private insurers irked by exemption only for Ayushman
Munich lowest bidder in Bharat
Nagaland
Insurance services under the Centrally-sponsored Ayushman Bharat scheme will
Apollo Munich Health Insurance be exempt from Goods and Services Tax
Company Limited has made the low- (GST), but other big health insurance
est bid for Ayushman Bharat-Na- segments like private retail and group
tional Health Protection Mission (AB- insurance will remain under GST ambit.
NHPM) for the state of Nagaland at
Rs 444 per family. While Bajaj Allianz While 10 crore poor families who had
General Insurance was second low- no insurance cover will get covered un-
est bidder at Rs 506, it is likely that der the Ayushman Bharat scheme, the
Apollo Munich will handle the health Union Health Ministry will save about Rs. 1,000- 2,000 crore of incremental costs
scheme for the state of Nagaland. that it would have otherwise paid as GST on premium to either private insur-
Interestingly, Rajasthan's Bhamashah ance firms or trusts, who come on board to run the scheme, Indu Bhushan,
health insurance scheme appears to CEO of Ayushman Bharat said.
have had an impact on the bidding
with leading PSU insurers either stay- The Union Health Ministry had written to the Department of Revenue to ex-
ing away or bidding much higher pre- empt Ayushman Bharat scheme from GST purview, Bhushan said, as Centrally-
mium amounts for the Rs 5 lakh of sponsored schemes should ideally not attract GST.
cover promised under the NHPS.
New India, the insurer for Private insurance players are, however, not too happy as it keeps private retail
Bhamashah, did not submit a finan- and group insurance under the GST ambit, making it less attractive for the
cial bid while National Insurance bid middle class. “For the first time ever, Prime Minister Narendra Modi-led gov-
Rs 1,944 per family and United India ernment has exempted any insurance service from tax, albeit this being run by
Rs 1,944. Reliance General Insur- the government itself,” Chief Operating Officer of a top private insurance com-
ance and Religare Health Insurance pany told Businessline. “However, retail and group plans still attract 18 per cent
Company Ltd had bid for Rs 1,020 GST. This means if a company is buying a group cover worth Rs. 50 lakh of pre-
and 1,060 per family respectively. mium, they end up paying Rs. Rs. 9 lakh as GST on it. So the total cost to com-
pany is Rs. 59 lakh.”
While private insurance services earlier attracted a service tax of 15 per cent,
they now attract a GST of 18 per cent. The incremental costs are passed on to
the consumer.
The costs of private healthcare are hitting the roof, while the public sector
crumbles. “On the top of that we do GST loading for the patient, who is not
covered under the Ayushman Bharat scheme. This is unfair. While social initia-
tives have had regulators’ policy level protections and they end up saving money
to be spent from government’s kitty, there should be some relief for the middle
class, who are forced to opt for private insurance too, and are not covered under
Ayushman Bharat,” said private insurance industry sources.
The Insurance Times, August 2018 11
