Ayushman Bharat Card Holders Alert! Private Hospitals May Stop Services

Ayushman Bharat Yojana: Through the central government’s Ayushman Bharat initiative, financially disadvantaged and vulnerable families are provided with cashless health coverage of up to Rs 5 lakh. This scheme was introduced by the central government in 2018. Millions have benefited from free treatment under this initiative, yet media reports suggest that several prominent private hospitals are now considering withdrawing from this government program.

As per reports, the reasons for this could include low treatment rates, delays in payments, and price caps imposed by the government. Although no major hospital has publicly announced their withdrawal from government schemes, organizations such as Max Healthcare, Narayana Health, Fortis Healthcare, and Healthcare Global have recognized the challenges and losses they are experiencing while managing these programs. Government initiatives like CGHS (Central Employees Health Scheme) and ECHS (Ex-Servicemen Health Scheme) generally represent about 25% of the total revenue for private hospitals, but consulting firm Praxis Global Alliance predicts that this percentage may decrease by 3 to 5 percent in the coming years. Hospitals might choose to exit certain schemes or restrict the number of beds available for these patients.

Specifically, the CGHS scheme caters to central government employees and pensioners, while the ECHS is designed for military personnel and their families. The government determines the treatment rates for both schemes, which hospitals find to be less lucrative. Apollo Hospitals has not commented on these schemes, citing their low business volume. The company reports that 83% of its revenue in the third quarter of FY26 was generated from patients with insurance and cash payments, indicating that revenue from government schemes is quite limited.

1. Getting less money for treatment
2. Delayed payments from the government

The report stated that private hospitals are now attempting to rebalance their revenue streams. They are prioritizing patients and payers who receive payments quickly, so that hospitals’ cash flow, or working capital, remains stable. Max Healthcare has, for the first time, clearly disclosed the losses it is incurring due to the government scheme, CGHS.

According to the company, its involvement with CGHS has affected revenue by approximately Rs 200 crore. Under the agreement with CGHS, Max is required to offer up to a 30% discount on chemotherapy drugs. Supply of drugs with a profit margin of less than 30% has been discontinued. Drugs with a profit margin of more than 30% are still being provided.