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Pradhan Mantri Jan Arogya Yojana (PM-JAY)

Updated: Jul 27, 2022

Ayushman Bharat

Ayushman Bharat, a flagship scheme of Government of India, was launched as recommended by the National Health Policy 2017, to achieve the vision of Universal Health Coverage (UHC). This initiative has been designed to meet Sustainable Development Goals (SDGs) and its underlining commitment, which is to "leave no one behind."

Ayushman Bharat is an attempt to move from sectoral and segmented approach of health service delivery to a comprehensive need-based health care service. This scheme aims to undertake path breaking interventions to holistically address the healthcare system (covering prevention, promotion and ambulatory care) at the primary, secondary and tertiary level. Ayushman Bharat adopts a continuum of care approach, comprising of two inter-related components, which are -

  • Health and Wellness Centres (HWCs)

  • Pradhan Mantri Jan Arogya Yojana (PM-JAY)

Health and Wellness Centers (HWCs)

In February 2018, the Government of India announced the creation of 1,50,000 Health and Wellness Centres (HWCs) by transforming the existing Sub Centres and Primary Health Centres. These centres are to deliver Comprehensive Primary Health Care (CPHC) bringing healthcare closer to the homes of people. They cover both, maternal and child health services and non-communicable diseases, including free essential drugs and diagnostic services. Pradhan Mantri Jan Arogya Yojana (PM-JAY)

The second component under Ayushman Bharat is the Pradhan Mantri Jan Arogya Yojna or PM-JAY as it is popularly known. This scheme was launched on 23rd September, 2018 in Ranchi, Jharkhand by the Hon’ble Prime Minister of India, Shri Narendra Modi. Ayushman Bharat PM-JAY is the largest health assurance scheme in the world which aims at providing a health cover of Rs. 5 lakhs per family per year for secondary and tertiary care hospitalization to over 10.74 crores poor and vulnerable families (approximately 50 crore beneficiaries) that form the bottom 40% of the Indian population.

Key Features of PM-JAY

  • PM-JAY is the world’s largest health insurance/ assurance scheme fully financed by the government.

  • It provides a cover of Rs. 5 lakhs per family per year for secondary and tertiary care hospitalization across public and private empanelled hospitals in India.

  • Over 10.74 crore poor and vulnerable entitled families (approximately 50 crore beneficiaries) are eligible for these benefits.

  • PM-JAY provides cashless access to health care services for the beneficiary at the point of service, that is, the hospital.

  • PM-JAY envisions to help mitigate catastrophic expenditure on medical treatment which pushes nearly 6 crore Indians into poverty each year.

  • It covers up to 3 days of pre-hospitalization and 15 days post-hospitalization expenses such as diagnostics and medicines.

  • There is no restriction on the family size, age or gender.

  • All pre–existing conditions are covered from day one.

  • Benefits of the scheme are portable across the country i.e. a beneficiary can visit any empanelled public or private hospital in India to avail cashless treatment.

  • Services include approximately 1,393 procedures covering all the costs related to treatment, including but not limited to drugs, supplies, diagnostic services, physician's fees, room charges, surgeon charges, OT and ICU charges etc.

  • Public hospitals are reimbursed for the healthcare services at par with the private hospitals.

Benefit Cover Under PM-JAY

Benefit cover under various Government-funded health insurance schemes in India have always been structured on an upper ceiling limit ranging from an annual cover of INR30,000 to INR3,00,000 per family across various States which created a fragmented system. PM-JAY provides cashless cover of up to INR5,00,000 to each eligible family per annum for listed secondary and tertiary care conditions. The cover under the scheme includes all expenses incurred on the following components of the treatment.

  • Medical examination, treatment and consultation

  • Pre-hospitalization

  • Medicine and medical consumables

  • Non-intensive and intensive care services

  • Diagnostic and laboratory investigations

  • Medical implantation services (where necessary)

  • Accommodation benefits

  • Food services

  • Complications arising during treatment

  • Post-hospitalization follow-up care up to 15 days

The benefits of INR 5,00,000 are on a family floater basis which means that it can be used by one or all members of the family. The RSBY had a family cap of five members. However, based on learnings from those schemes, PM-JAY has been designed in such a way that there is no cap on family size or age of members. In addition, pre-existing diseases are covered from the very first day. This means that any eligible person suffering from any medical condition before being covered by PM-JAY will now be able to get treatment for all those medical conditions as well under this scheme right from the day they are enrolled.


Over the last few decades, the world’s eyes have been on India as it’s economy has been one of the top three fastest growing economies of the world. However, despite making remarkable strides in several sectors, India is still classified as a Lower Middle-Income Country (LMIC) according to World Bank classification of countries based on per capita GDP, mostly due to its inconsistent socio-economic and health indicators.

Statistics show that more than 20 per cent of India’s population still lives under $1.9 per day (2011 PPP). According to a World Bank projection, by 2021 more than 34% of India’s population will be in the age group of 15-35 years. This rich demographic dividend enables India to be highly optimistic about a sustained economic growth for few more decades before a higher dependency ratio sets in.

However, the perceived benefits of the higher demographic dividend are threatened by the epidemiological transition in India which is currently facing the unique situation of a “triple burden of disease.” As the mission of eradication of major communicable diseases remains unfinished, the population is also bearing the high burden of non-communicable diseases (NCDs) and injuries. This leads to an overall rise in the demand for health care over a prolonged period of time

Coverage under PM-JAY

Including the poorest and most vulnerable population of any country in the health insurance programme is often the most challenging because they cannot pay any premium and are the hardest to reach. Many times they are also not literate and, therefore, require a very different approach for awareness generation. This is true for most Lower and Middle-Income Countries (LMIC) and India is not an exception. Thus, PM-JAY has been rolled out for the bottom 40 per cent of poor and vulnerable population. In absolute numbers, this is close to 10.74 crore (100.74 million) households.

Rural Beneficiaries

Out of the total seven deprivation criteria for rural areas, PM-JAY covered all such families who fall into at least one of the following six deprivation criteria (D1 to D5 and D7) and automatic inclusion(Destitute/ living on alms, manual scavenger households, primitive tribal group, legally released bonded labour) criteria:

  • D1- Only one room with kucha walls and kucha roof

  • D2- No adult member between ages 16 to 59

  • D3- Households with no adult male member between ages 16 to 59

  • D4- Disabled member and no able-bodied adult member

  • D5- SC/ST households

  • D7- Landless households deriving a major part of their income from manual casual labour

Urban Beneficiaries

For urban areas, the following 11 occupational categories of workers are eligible for the scheme:

  • Ragpicker

  • Beggar

  • Domestic worker

  • Street vendor/ Cobbler/hawker / other service provider working on streets

  • Construction worker/ Plumber/ Mason/ Labour/ Painter/ Welder/ Security guard/ Coolie and other head-load worker

  • Sweeper/ Sanitation worker/ Mali

  • Home-based worker/ Artisan/ Handicrafts worker/ Tailor

  • Transport worker/ Driver/ Conductor/ Helper to drivers and conductors/ Cart puller/ Rickshaw puller

  • Shop worker/ Assistant/ Peon in small establishment/ Helper/Delivery assistant / Attendant/ Waiter

  • Electrician/ Mechanic/ Assembler/ Repair worker

  • Washer-man/ Chowkidar

Expansion of coverage by States under PM-JAY and convergence

Various States have been implementing their own health insurance/assurance schemes over the past couple of decades. Most of these schemes provide cover for tertiary care conditions only. The benefit cover of these schemes is mostly available within the State boundaries except some smaller States have empanelled a few hospitals outside the State boundaries. Very few States had converged their schemes with the erstwhile RSBY scheme and many of them were operating independently. This was due to the lack of flexibility in the design of the RSBY, which although initially helped in quick scale-up but became a challenge over a period of time and offered limited flexibility to the States.

Implementation Model

Various States are using different models for implementing their own health insurance/ assurance schemes. Some of them are using the services of insurance companies while others are directly implementing the schemes in their States. Considering the fact that States are at different levels of preparedness and have varying capacity to manage such schemes, PM-JAY provides the States with the flexibility to choose their implementation model. They can implement scheme through assurance/trust model, insurance model or mixed model.

A. Assurance Model/Trust Model

This is the most common implementation model adopted by most of the States. Under this model, the scheme is directly implemented by the SHA without the intermediation of the insurance company. The financial risk of implementing the scheme is borne by the Government in this model. SHA essentially reimburses health care providers directly. Even though no insurance company is involved, the SHA employ the services of an Implementation Support Agency (ISA) for claim management and related activities. As there is no insurance company in the picture, apart from day-to-day management and administration of the scheme, the SHA also has to carry out specialised tasks such as hospital empanelment, beneficiary identification, claims management and audits and other related tasks

B. Insurance Model

In the insurance model, the SHA competitively selects an insurance company through a tendering process to manage PM-JAY in the State. Based on market determined premium, SHA pays premium to the insurance company per eligible family for the policy period and insurance company, in turn, does the claims settlement and payments to the service provider. The financial risk for implementing the scheme is also borne by the insurance company in this model. However, to ensure that the insurance company does not make an unreasonable profit, the scheme provides for a mechanism where insurance companies can only get a limited percentage of the premium for their profit and administrative costs.

C. Mixed Model

Under this, the SHA engages both the assurance/ trust and insurance models mentioned above in various capacities with the aim of being more economic, efficient, providing flexibility and allowing convergence with the State scheme. This model is usually employed by brownfield States which had existing schemes covering a larger group of beneficiaries.

Financing of The Scheme

PM-JAY is completely funded by the Government and costs are shared between Central and State Governments. The Government of India decides a national ceiling amount per family that is used to determine the maximum limit of the central share of the contribution. The actual premium discovered through open tendering process or the maximum ceiling of the estimated premium decided by Government of India for the implementation of PM-JAY, whichever is less, would be shared between Central Government and States/UTs in the ratio as per the extant directives issued by Ministry of Finance, from time to time. In addition, administrative cost for implementing the scheme at the State level is also provided under the scheme and shared between Centre and State in the same sharing pattern.

Hospital Empanelment

The supply of health care services under PM-JAY must be ensured through pre-selected, well equipped and well-prepared hospitals to deliver the benefits. Also, the hospitals must be distributed widely enough over the geography so as to ensure optimal accessibility to the eligible families. In order to cater to the increased demands under PM-JAY and also to ensure quality care to the beneficiaries, it is imperative to maintain and grow a network of hospitals that also conform to the quality standards and criteria. This leads to the need of empanelment of hospitals on a pre-emptive basis so that beneficiaries are certain of their rights being honored in the most convenient, cashless and quality manner.

Empanelment Criteria

Considering the supply side characteristics (nearly 71 per cent of the hospitals are running as proprietorship businesses with less than 25 beds capacity and offering non-specialised general clinical care), two types of empanelment criteria have been evolved. These criteria have been evolved based on the experience of the prevalent practice in other Government-funded health insurance schemes, State-specific regulations related to the quality of care and Clinical Establishment Act 2011.

The detailed criteria for empanelment are available on

  • General criteria – For hospitals that provide non-specialised general medical and surgical care with or without ICU and emergency services.

  • Special Criteria (for clinical specialties) – For each specialty, a specific set of criteria has been identified. Under PM-JAY, a hospital is not allowed to select the risk, which means it cannot apply for selected specialties and must agree to offer all specialties to PM-JAY beneficiaries that are offered by it. However, in order to offer a specialised clinical service, the hospital must have necessary specific infrastructure and HR in place as mentioned in the special criteria developed under PM-JAY for the same.

Packages and Rates

To ensure that the hospitals do not overcharge and rates do not vary across hospitals, empanelled health care providers (EHCP) are paid based on specified package rates. A package consists of all the costs associated with the treatment, including pre and post hospitalisation expenses. The specified surgical packages are paid as bundled care (explained below) where a single all-inclusive payment is payable to the EHCP by insurer/SHA. The medical packages, however, are payable to the EHCP on a per day rate depending upon the admission unit (general ward, HDU, ICU) with certain pre-decided add-ons payable separately. Day-care packages are payable just like surgical packages. The treatment packages are very comprehensive, covering treatment for nearly 24 specialities that include super speciality care like oncology, neurosurgery and cardio-thoracic and cardiovascular surgery, etc. The package rate (in case of surgical or defined day-care benefits) includes:

  • Registration charges

  • Bed charges (General Ward)

  • Nursing and Boarding charges

  • Surgeons, Anaesthetists, Medical Practitioner, Consultants’ fees, etc.

  • Anaesthesia, Blood Transfusion, Oxygen, O.T. Charges, Cost of Surgical Appliances, etc.

  • Medicines and Drugs

  • Cost of Prosthetic Devices, implants (unless payable separately)

  • Pathology and radiology tests: radiology to include but not be limited to X-ray, MRI, CT Scan, etc. (as applicable)

  • Food to patient

  • Pre and Post Hospitalisation expenses: Expenses incurred for consultation, diagnostic tests and medicines before the admission of the patient in the same hospital, and up to 15 days of the discharge from the hospital for the same ailment/ surgery

  • Any other expenses related to the treatment of the patient in the EHCP

As mentioned in the previous section based on a few criteria, hospitals can be paid a higher amount. For such surgical conditions that are not listed in the package list, an EHCP will need to take approval and fix the rate from the insurer/ SHA before providing the treatment up to the limit of INR 1,00,000.

Awareness and Communication

Since PM-JAY is an entitlement-based scheme where there is no advance enrolment process, making beneficiaries aware of the scheme is the most critical aspect. Information, Education and Communication activities need to be carried out to educate beneficiaries about the scheme. Various modes of communication such as leaflets, booklets, hoardings, TV, radio spots etc are important elements for creating a comprehensive communication strategy for disseminating the desired messages across the target audience.

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