You might have seen somewhere that we are SEBI-Registered Investment Advisors (RIAs). What’s the big deal? Why have we mentioned it almost everywhere you can find the name DocWealth?

What’s Special About SEBI-Registered Investment Advisors (RIAs)?

Perhaps you’ve encountered some transcendent advice like “Turmeric cures cancer,” “Drink cow urine & never get sick!,” or “Eating rice at night makes you diabetic.”? As doctors, you might even feel enraged when such things get undue attention, while the fundamentals of good health are neglected.

We feel a similar pain when random people make blanket statements and share generic advice. In fact, RIAs are similar to doctors in many ways. While anyone can pick up the phone and become a guru, an RIA firm is well-equipped to handle your finances. 

Here’s what makes them different:

#1. No Commissions

In our co-founder’s personal experience, this is the most powerful factor that sets us apart, and the reason why DocWealth was created. When bankers, brokers, agents, and online influencers share “financial advice,” they tend to make their income from commissions.

For every insurance policy, mutual fund share, or credit card sold, they receive a share of the profit. Meanwhile, RIAs are legally bound to act in their clients’ best interest. We charge clients directly and transparently (flat-fee or percentage of Assets Under Management (AUM)). 

#2. Qualifications Required

There are strict requirements that a firm must achieve before it becomes an RIA:

• Educational Qualifications: PG degree in finance, accounting, economics, commerce, business management, capital markets, etc. 

• OR a professional qualification like CA, CFA (India or US), CS, ICWA, MBA (Finance).

• OR a NISM Level 2 Investment Adviser Certification (mandatory even if you’re otherwise qualified).

• Industry Experience: Minimum 5 years’ experience in financial advisory, portfolio management, or related fields. You can’t be an RIA without expertise.

• High Net Worth: It’s not enough to simply manage wealth; RIAs need to maintain their own wealth too. We “practice what we preach.”

• Individuals: Minimum ₹5 lakh net worth.

• Partnerships/Companies: Minimum ₹50 lakh net worth.

#3. Answerable & Accountable

Being an RIA is not a one-time thing. We must continually prove our worthiness of the title to maintain our status. We are also held accountable for our actions and are responsible for our clients and their wealth.

• Licensed Professionals: We must demonstrate the above qualifications to obtain certification and renew our license every 5 years. We must also renew our NISM certification every 3 years.

• Long-Term Adherence: Keeping records, prioritizing client needs over self-interest, maintaining our net worth, and going through annual audits are just some of our ongoing compliance activities. We lose our title if we don’t follow these rules.

What’s more, there is a clear way to address grievances to SEBI that makes any malpractice next to impossible. While most investment advice hides behind a sneaky disclaimer, any unwarranted losses incurred by an RIA can be reported via their license number! (ours can be found on this website’s footer)

Conclusion

SEBI-registered investment advisors are licensed, trustworthy, accountable, and experienced professionals who offer conflict-free advice. We do not discourage anyone from saving and investing on their own, but we always prioritise our clients' interests.

That’s the key difference: a doctor prescribing what you need vs. a pharma rep pushing what pays them most. If you’d like to learn more, please give us a call, drop us a text, or book a free consultation.

FAQs

Q1. What is a SEBI-registered investment advisor (RIA)?
A. An RIA is a licensed financial professional regulated by SEBI who provides unbiased advice without commissions.

Q2. Why should doctors choose an RIA instead of online financial influencers?
A. Fin-fluencers often earn from selling products, while RIAs are legally bound to act in your best interest.

Q3. How do I verify if someone is a SEBI-registered investment advisor?
A. You can search their name or license number on SEBI’s official website.

Q4. What qualifications are required to become an RIA in India?
A. A PG in finance/economics or certifications like CFA, CA, MBA (Finance), plus minimum experience and net worth.

Q5. Do RIAs earn from commissions?
A. No. They charge either a flat fee or a percentage of assets under management (AUM), making advice conflict-free.

In India, where 70% of healthcare is corporate-run, doctors must balance two forces: ethics & profit. The industry's challenges are not for the faint of heart; only a higher calling can prevail. Who gets up at 3 AM to deliver a baby for a paycheck? Yet, any sustainable endeavor needs a healthy cash flow. 

The conflict between values and profits can be observed on multiple levels: doctors weigh whether to serve in government Primary Health Centers (PHCs) or corporate hospitals, clinic owners balance the patient experience with maximum turnover, and pharma reps fine-tune salesmanship with health impact. Let's simplify and note these challenges, as reported by senior doctors.

Ethical Challenges in Modern Indian Healthcare

Medicine is a social science, making every medical professional a social worker. Yet most of India’s healthcare is provided by massive corporations like Fortis, Max Hospitals, Aster, and Apollo Hospitals, which are answerable to shareholders.

This conflict of interest, the company’s need to profit vs. the hospital's role in social service, leads to serious systemic issues. Despite the “Planet>People>Profit” idiom that supposedly guides boardroom decisions, the ground reality in most corporate hospitals involves:

#1. Over-Investment

Overzealous and naive hospital management tends to overinvest in world-class facilities. The idea is that the latest technology will improve footfall by attracting patients. While that may be true to some extent, potential ROI can only be calculated in hindsight, while the actual capital demands a break-even point. This way, overinvestment leads to immense pressure for rapid growth.

#2. Referral Fees

Faced with the pressure of rapid growth, hospitals then offer independent practitioners referral fees to grow their patient base quickly. This practice is widely criticized as deplorable, as it veers dangerously into the marketing & sales domain. What's more, the cost of referral fees ultimately falls on patients, as the hospitals factor it into the bill. This makes healthcare costlier.

#3. Unnecessary Procedures

There are two primary reasons why doctors and hospital management are motivated to undertake unnecessary investigative procedures like diagnostic tests (x-ray, bloodwork, etc.):

1. “Fee For Service” Model

This is not about whether the patient pays cash, has a cashless private insurance, or opts for credit; It's about how the bill amount is calculated. They do it based on the individual services administered throughout the treatment process. When patients are charged separately for each service, hospitals are monetarily incentivized to perform more procedures.

2. Defensive Medical Practices

While no systematic data proves the full extent, medico-legal cases have been rising at an alarming rate. Whether the causes behind it are healthcare's commercialisation, rising patient/consumer awareness, hostility toward healthcare professionals, or something else is uncertain. Regardless, the looming threat of malpractice lawsuits prompts procedures to be done “for the record” and “just in case.”

Yet, the fact remains:

• More tests do not always mean better treatment.

• CT scans & over-diagnosis add risks beyond cost.

#4. Brain Drain

To be clear, we are not calling this (very public) economic issue an ethical conundrum to place the onus on doctors and condemn them for prioritising career growth. We believe this issue belongs on this list because it warrants discussion, particularly among Indian medical students. 

When private institutes overtake public ones, it encourages a brain drain & concentration of talents. The result? 80% of Indian doctors are in cities where only 28% of the population resides. Most doctors struggle with this decision at some point in their career: go where they think they are needed or where they might get paid the best?

Generally, we believe that the best solution is to practice as best as you can wherever you may be. Moving tends to carry greater and less predictable financial repercussions than trying to do better wherever you are. Of course, for more helpful advice, you should give us a call and talk to our advisors who specialise in doctors' finances.

#5. Medical Tourism in India

India holds great potential for medical tourism. Foreigners worldwide often seek out “first-world treatments at third-world prices” here. This is mainly seen as a net positive for both hospitals and patients, and doctors need all the "win-win" situations they can get. 

Without diminishing the positives, there are some ethical implications to be aware of. Many hospitals end up having separate facilities (areas, floors, or even buildings) for the rich and the poor. Separate hospital facilities for affluent patients both symbolize and perpetuate health exclusion.

#6. Polypharmacy

Our pharmaceutical industry is also a worldwide giant, with India being one of the biggest exporters of affordable generic meds. Yet, for being the birthplace of Ayurveda, there is another troubling trend shaping within our borders: Overprescription of medicines to patients.

This might partly be fueled by defensive medical practices (as explained in point #3.2 above), but patients themselves are often unwilling to stop taking medicines. Big Pharma's aggressive promotions can also produce drugs of questionable value. Furthermore, it’s dangerous when pharma companies sponsor medical conferences to push their products. 

Conferences are rare opportunities for busy doctors to stay updated, and this commercialisation of healthcare products (where new, bigger, better drugs are emphasised) also contributes to polypharmacy.

Potential Solutions: Ethical Guidelines

The reason we discuss these issues is that in high-stakes industries like medicine, finance, and law, trust matters most. As the public loses confidence in hospitals, they also lose faith in the doctors, nurses, and staff's ability to help them heal. 

The point is not to play the blame game. It’s to understand why tensions are rising between doctors and patients, and how HCPs can better succeed. Once we acknowledge & accept these difficulties, we can start building sustainable solutions. These rules of thumb, partly inspired by official NMB guidelines, might help:

• Informed consent (clearly explaining procedures, risks, and alternatives to patients).

• Lean Healthcare (invest & expand slowly as income & patients grow organically).

• Transparency in billing and referrals (avoiding kickbacks, unnecessary tests).
  

• Patient confidentiality (protecting medical records and privacy).
  

• Duty of care (prioritizing patient safety and best interest over profit motives).
  

• Competence & accountability (practicing only within one’s expertise, avoiding negligence).

These standards are widely known and practiced by most doctors, but a little revision never hurt. In the first guideline shared above, informing the patient should also include the cost and effectiveness of other centers. When patients are educated & offered second opinions, the clinics providing such excellent service profit in the long term.

Shrouded in Darkness, A Glimmer of Hope

It’s natural to get jaded and lose faith. High-stress situations can make even the most resilient among us feel naive for believing in ideals. Here is a little inspiration:Dr. Govindappa Venkataswamy of Tamil Nadu. Dr. Venkataswamy (affectionately known as Dr. V) had a dream to eradicate blindness from the world.

He founded the Aravind Eye Care System in 1976, which annually treated up to a million people, with 60% of them receiving free treatment. The doctors who participated performed an average of 80 daily surgeries and became renowned for their incredible gentleness. 

A key component of the system was its differential pricing model, which featured tiered charges for individuals in various economic groups. Dr. V said it best:

“If you can’t pay them, you don’t have to. If you can’t come to them, they’ll come to you.”

Business executives might flinch at this philosophy as a business model. But that might reveal a fundamental misunderstanding of profiting in healthcare, more than anything else. As a Harvard Business Review study should prove, Dr. V’s lifelong efforts led to a very successful & financially viable institute that continues to thrive.

Conclusion

This is the mantra of Business in Ethics: the good of the many leads to the good of the few. As doctors, the more good you do in the world, the more likely you are to succeed in the long run- financially, personally, and holistically. I’ll end by quoting Dr. V:

“We identify ourselves with all that is in the world, 

so there is no exploitation.

It is ourselves we are helping.

It is ourselves, we are healing.”

- Dr. Govindappa Venkataswamy

Is Ayushman Bharat (PM-JAY) 

Financially Viable?

Universal health coverage is a noble goal. But for doctors, it often means more paperwork, less time per patient, and fewer rewards. Ayushman Bharat (PM-JAY), India’s biggest national health insurance scheme, is at the center of this challenge.

This article examines the many hurdles of PM-JAY to answer one question: Is it financially viable for private healthcare providers?

Progress matters, but not at the expense of your well-being. Read on to explore the scheme's challenges, or find our other guides for an overview, best practices, and how to get empaneled.

#1. Systematic Delays

Cash flow is the lifeblood of any organisation, and hospitals have always struggled to stay afloat. Massive investments, uncertain flow of patients, and regulations are just some of the constant challenges.

Yet, government systems just don’t move as fast as private companies. Under PM-JAY, private Healthcare Providers (HCPs) risk their already precarious revenue cycle to potential delays.

• Every step in the PM-JAY process has an official Turnaround Time (TAT). 

• Empanelment = simple 30-45 days. (varies greatly)

• Beneficiary verification = Automatic

• Pre-Authorization = 6-12 hours

• Claim settlement = 15-30 days

• Yet, on-ground reports suggest otherwise:

• Empanelment process is said to be slow, opaque, and burdensome.

• There have been reports of delays due to IT glitches on holidays.

• Delayed pre-authorization that directly affects treatment.

• Notorious payment delays, to the point of severe disruptions. 

The IT ecosystem has improved with the launch of BIS 2.0 & HEM 2.0, but the claims system (TMS) still has a long way to go. A key issue is the lack of prompts for incomplete submissions, leading hospitals to develop their own software.

#2. Constant Scrutiny

No one becomes a doctor to do administrative work. Unfortunately, medico-legal cases are rising, and most patients are dependent on health insurance. Even HCPs are forced to maintain detailed notes and accurate documents.

In AB-PMJAY, empanelment hassles are just the beginning. Long after joining, private hospitals are subject to audits, policy changes, and surprise visits. 

• Thousands of hospitals have been de-empaneled for various issues.

• Claims are rightfully scrutinised as well. To the extent that dedicated staff needs to be hired for PM-JAY administrative work (Arogyamitras).

• Up-to-date information must be filled in the Hospital Empanlement Module (HEM). Keeping up with policy changes is additional work.

For example, the govt. is currently pushing the Ayushman Bharat Digital Mission (ABDM). While participation is not mandatory, savvy managers will recognize the potential benefits, especially under the PM-JAY scheme. 

#3. Cashflow Disruptions

It’s no secret that the scheme is notorious for delayed payments (on average, 6-9 months). Mid to small-sized healthcare providers cannot afford such delays, as they cripple the cash flow. 

Tertiary healthcare professionals (specialists) are especially vulnerable due to their dependence on short-term revenue to maintain operations. Recently, private doctors in Haryana were forced to go on strike due to these delayed payments.

The Comptroller and Auditor General of India (CAG) did a revealing audit of the scheme’s performance covering the period from 2018 to 2021:

• A shocking 39.57 lakh claims for pre-authorisation took longer than the stipulated 12-hour period. This delays care while taking up hospital resources.

• As of Nov 2022, 40.23 lakh claims worth Rs 6,052.47 crore were still under process, awaiting approval or rejection.

• Inconsistencies were noted (eg, some late claims being rejected) while 2,04,654 late claims worth Rs 201.55 crore were approved in UP alone.

#4. Inadequate Package Rates

AB (PM-JAY) groups healthcare services into “treatment packages” for simpler claims. But these package rates are often 40-50% lower than the market prices. This is the scheme’s biggest criticism, leading to several issues:

• Treating chronic diseases → often costs more than PM-JAY pays, since care is long-term and resource-heavy.

• Complex surgeries (e.g., cardiac) → offer better rates, making them more profitable. So, clinic owners might favor these procedures. 

• To avoid this “cherry-picking” of patients, PM-JAY mandates that hospitals provide all treatments that their infrastructure & resources allow.

“Standardisation” means that the quality of care in private and public hospitals is similar for beneficiaries. Yet, private hospitals tend to have better, more expensive facilities. Thus, private hospitals often end up absorbing losses, with little flexibility.

#5. Cycle of Distrust

These issues snowball and pressure hospital owners. Many of them join the scheme to improve occupancy rates and get more patients. When facing cripping delays, HCPs might be tempted to engage in shady practices, like:

• Performing one procedure, but documenting two, citing medical complications.

• Additional charges for things not covered by the scheme (like certain valves).

• Providing unnecessary procedures to “make up” for losses.

In fact, this is quite common in certain places and is casually swept under the rug with bribes. This leads to even stricter reforms and lengthy procedures that further delay the claims process, creating a vicious cycle of distrust.

#6. Logistics & STGs

So far, we’ve covered “top-down” issues with the policy, highly relevant to clinic owners. However, the scheme is implemented on the ground, and HCPs also struggle with numerous problems. 

• The scheme’s Standard Treatment Guidelines (STGs) note the “ideal” treatment for any package. Sticking to STGs ensures smoother claims.

• But in practice, STGs often prioritize logistics over patient experience.

• In Madhya Pradesh, 472 packages (mostly non-surgical) are reserved only for public hospitals. This creates gaps in multi-package treatments, for example:

• A cancer patient gets surgery in a private hospital, but must get chemo at a public one.

• Patients usually refuse, since public hospitals may lack oncologists.

• Result: patients pay out of pocket, hurting the private hospital’s goodwill.

In public hospitals, Arogyamitras (AMs) often have a medical background, enabling them to navigate STGs & claims better. But in private hospitals, it’s not always possible to get such an ideal candidate.

#7. Indirect Issues

Some other challenges hampering the scheme’s smooth operation:

• A lack of any feedback mechanism for Empaneled Healthcare Providers (EHPs). 

• The culture of believing that “Hospitals are only for worst-case scenarios.” 

• Beneficiaries delay treatment until ailments become emergencies.

• Each state has its own set of unique roadblocks and ecosystems.

The Other Side of PM-JAY

So, if there are so many issues, why should a private hospital join Ayushman Bharat? Putting aside the benefit of the public, a popular study published in Springer Medizin might shed some light.

• The study ran 10-year projections for a hypothetical 100-bed hospital running PM-JAY rates only.

• Annual Expenditure: Rs 8.527 crore, with HR (40%) & drugs/consumables (20%) being the most significant cost centers.

• Annual Revenue: Rs 10.436 crore, based on PM-JAY package rates and patient volume data.

• Break-Even Point: 4th year of operation.

• High occupancy rates and government subsidies (like free land for construction) can reduce the break-even point to the second operational year.

While idealistic, the study challenges the popular narrative of unviability with concrete information. Another excellent example is the real case study of a successful tertiary HCP based in New Delhi: (download full PDF)

• High success rate: 1,255 claims filed → 1,210 settled (~96% success).

• Specialty-driven: Neurosurgery (28.9%), Orthopedics (20.8%), & Cardiology (17.1%) dominated claims = lucrative specialties.

• Cross-subsidization: 21 package costs exceeded the official rates. The losses were balanced by profits on other packages, keeping services viable.

• Flexibility in Packages: 32 unspecified surgeries were approved, showing the potential to expand beyond fixed packages.

• Zero-denial policy: No patients were turned away = reputation + patient trust.

Conclusion

While the challenges are very real, the financial viability of empaneling under PM-JAY depends on many factors. The real determining factor of any such project is the people on the ground. 

How is the situation in your state, area, and district? Who is your target patient base? What do you have to offer in terms of human resources and infrastructure?

Depending on your answers, participation could sink or swim your practice. To learn more, read our articles on PM-JAY best practices, the empanelment process, and the overview.

FAQs

Q1. What are the biggest challenges of PM-JAY for private hospitals?
A: Key issues include payment delays, inadequate package rates, heavy scrutiny, logistical hurdles in STGs, and cash flow disruptions.

Q2. How long do PM-JAY payments take?
A: Officially 15–30 days, but reports suggest payments are often delayed for 6–9 months, creating severe cash flow problems for smaller hospitals.

Q3. Why are package rates under PM-JAY considered inadequate?
A: Package rates are often said to be 40–50% lower than market prices. This makes chronic disease care unprofitable, forcing hospitals to cross-subsidize treatments.

Q4. Can private hospitals be profitable under PM-JAY?
A: Yes. Studies show profitability is possible with high occupancy, efficient operations, and government subsidies, though challenges remain.

Q5. Should small hospitals join PM-JAY?
A: It depends on factors like patient base, infrastructure, local implementation, and ability to manage delayed payments. 
For some, it’s viable; for others, it’s not.

This article is for Healthcare Providers (HCPs) who are interested in the best way to participate in Ayushman Bharat (PM-JAY). You may already be empaneled, or you may be conducting in-depth research to make a decision.

DocWealth is a specialised financial advisory firm where healers thrive. Read our articles on the introduction to the AB-PMJAY, the empanelment process, & the scheme's challenges for more information.

How to Make AB-PMJAY Financially Viable?

As one of the world’s most ambitious national health insurance schemes, the implementation of PM-JAY  has been bumpy. Delayed claims and miscommunication are just the beginning. Complex issues surrounding Standard Treatment Guidelines (STGs), systematic delays, and logistical challenges remain substantial. 

Yet, there are many steps an Empaneled Healthcare Provider (EHCP) can take to make participation more sustainable.

#1. Consider Your Business Model

• Do you have a sufficient number of beneficiaries to justify participation?

• Are there other, more established empaneled competitors in your area?

• If you are deep in debt, it might be better to delay participation.

Knowing your operation’s business model is an excellent practice in general. 

Make a plan to address any issues, and try to implement it on a small scale. 

If your patient base is incompatible and you face high competition, PM-JAY may not be the right option for you.

#2. Certifications & Incentives

Certifications:

• An entry-level National Accreditation Board for Hospitals & Healthcare Providers(NABH) certification = 10% incentive on package rates.

• Full NABH or National Quality Assurance Standards (NQAS) = +15%

• PM-JAY quality certifications: Bronze, Silver, Gold = +5%, +10%, +15%

Other Incentives:

• EHCPs in “aspirational districts” = +10%

• Educational EHCPs offering PG/DNB courses = +10%

In theory, a hospital can have a full NABH/NQAS/PM-JAY Gold certification (+15%), in an aspirational district (+10%), and offer PG/DNB courses (+10%). They can then get reimbursed for treatments under PM-JAY at 35% above the official package rates.

#3. Do Local Research

Look at your state and city’s AB-PMJAY data and analyse it for insights. Local health associations and NGOs can provide insights about your specific patient base/PM-JAY beneficiaries. Connect with other EHCPs to understand their plights.

• Guess the claim settlement ratio, outstanding debt, & average payment time.

• Are the beneficiaries familiar with the healthcare process under PM-JAY?

• What can you learn from other EHCPs in the area?

#4. Financial Testing

Don’t assume timely payments & record PM-JAY treatments as income after submitting the claims.

• Add all your fixed & rough variable expenses. 

• Factor in all your cash inflows, including the PM-JAY claims.

• Remove PM-JAY inflows for 3, 6, 9, & 12 months to see the gap vs expenses.

• Calculate the buffer, min. reserves/credit line, needed to survive each scenario.

If your accountant has a sense of humor, call this model Schrödinger’s reimbursement. 

This stress test allows management & owners to have a clear “go/no-go” signal. 

If unpaid claims pass a certain threshold, you must stop taking PM-JAY patients.

#5. Human Resources

People are the core of any organisation. The success of this scheme for your practice hinges on the coordination of two groups: Pradhan Mantri Arogya Mitras (PMAMs) & all staff involved in treating PM-JAY beneficiaries.

5.1 Arogyamitra:

A dedicated staff member to be the face of the scheme and responsible for its implementation. 

To be hired & trained by the private hospital itself.

• Quantity:

• The NAH recommends one arogyamitra for every 10 PM-JAY patients per day. 

• (eg, 30 daily PM-JAY patients = 3 PMAMs) 

• Selection criteria:

• Soft skills: local language fluency, empathetic, & amicable. 

• Hard skills: Scheme knowledge & computer proficiency.

• Education: 10+2 minimum.

• Role: 

• Greet patients, coordinate onboarding, staff, and discharge, & documentation.

• Managing the scheme’s IT platforms (BIS, TMS, & HEM).

• Training: the PMAM Qualification Pack (QP Code: HSS/Q6105)

Qualified female ASHA workers are often preferred for this role. SOPs are crucial as arogyamitras are the bedrock of this scheme. Make them responsible for updating the HEM & coordinating with other departments. 

5.2 Hospital Staff:

All staff members involved in treating beneficiaries should be informed of their role in the process. 

Workshops and educational modules are worth the effort to avoid claim issues.

• Everyone should be familiar with the general policy & implementation process.

• HMIS & EHR systems should be integrated with the PM-JAY IT ecosystem.

• Doctors should make detailed notes & suggest the right package.

• Staff should adhere to STGs & maintain good records.

• Clarify the “Whys” of participation to boost morale.

Avoid overburdening anyone, but encourage smoother claims & treatments. While many problems are unavoidable, effective solutions require collaboration between the admins and healers.

#6. Planning The Workflow

Ironing out the operational flow should be the next step. This entails mapping out your patients' physical movements and journey through the healthcare process. Each touch point should be placed accordingly.

• Strategic PMAM/AB-PMJAY desk placement at entry points for BIS verification.

• E.g., IBD, OBD, & Emergency reception areas

• Integrated IT systems throughout the hospital/clinic for pre-authorization.

• Detailed records aligned with STGs (as much as possible) at every step.

• Final check & smooth TMS/claim upload when the beneficiary is discharged.

#7. Monitoring & Improvement

The patient journey extends beyond your clinic, just as there is more to PM-JAY success than claim submission. 

Beneficiaries must be attracted, just as unpaid claims must be monitored & contingencies must be enforced.

• Consider marketing or awareness campaigns to guide & attract beneficiaries.

• Ensure that the financial stop-marks calculated in Step #4 are utilised. 

• E.g., Arogyamitras updates accountants on unpaid claims every month.

• Accounting tallies against projections & informs management.

• Monitor the PMAM satisfaction ratings submitted by beneficiaries.

• Hold regular workshops whenever possible to inform new staff.

#8. Systemic Reforms

We cannot pretend that Ayushman Bharat (PM-JAY) is flawless simply because it's ambitious. 

Real progress requires facing the facts, finding solutions, and breaking boundaries. 

The key to this is nurturing strong communities. 

Get involved with industry bodies, stay connected with other HCPs, and discuss issues. 

Support & participate in efforts to lobby the NHA & state governments for critical systemic reforms.

Potential Solutions

• Transparent, real-time, & verifiable claim tracking system visible to EHCPs.

• Penalty clause for delayed payments.

• For example, a 1% monthly interest charge on dues pending beyond the official timeline.

• Regularly improving STGs that may be outdated or problematic.

• Feedback & grievance redressal mechanisms on central, state, & district levels. 

Conclusion

Depending on your hospital/clinic’s location, following these practices can significantly improve your chances of thriving under PM-JAY. Otherwise, following the first few steps should tell you whether or not to join the scheme.

As a hospital owner, a senior doctor, or a clinic manager, it’s your responsibility to make your practice sustainable. This means having a solid ethical business plan and reliable financial models.

Healthcare providers, investors, and patients can achieve win-win scenarios. When health and wealth combine, it enhances our nation's quality of life. With better standards, everyone benefits.

FAQs

Q1. What is the main benefit for private hospitals to join AB-PMJAY?
Access to a larger patient base and government-backed reimbursements, provided claims are managed efficiently.

Q2. How can a hospital increase its PM-JAY reimbursement rates?
By achieving certifications like NABH/NQAS or PM-JAY Quality levels (Bronze, Silver, Gold), and leveraging incentives for aspirational districts or PG/DNB programs.

Q3. What is the biggest financial risk under PM-JAY?
Delayed reimbursements causing cash flow issues. That’s why stress-testing financial models & putting stop marks in place is critical.

Q4. Who manages the scheme inside the hospital?
Pradhan Mantri Arogya Mitras (PMAMs) act as the main coordinators, supported by doctors, nurses, and administrative staff.

Q5. What are common mistakes EHCPs should avoid?
Relying on timely reimbursements, poor documentation, ignoring STGs, and failing to train staff on scheme processes.

This is a straightforward, step-by-step guide for private hospitals on how to join Ayushman Bharat (PM-JAY). The first step is to get your hospital empaneled. Please read our article on Ayushman Bharat’s nuances before proceeding. Once you understand and accept the risks and benefits of joining the scheme, you can follow the steps below to participate.

(This article is based on official government resources.)

Step 1: Minimum Requirements

• Minimum Bed Capacity: You must have at least 10 functional in-patient beds.

• 24/7 Manpower: You must have qualified medical and technical staff physically present and on duty around the clock. At least one “Medical” and one “Technical” detail must be submitted in the application process.

• Support Systems: Your facility must have arrangements for 24/7 support, including a pharmacy, laboratory, and blood bank (either in-house or through a formal tie-up).

• Statutory Licenses: You must possess valid and current certificates for:

• Hospital Registration (e.g., under the Clinical Establishments Act).

• Fire Safety (No Objection Certificate from the local fire department).

• Bio-Medical Waste Management (Authorization from the State Pollution Control Board).

• Super Specialty Criteria: The required infrastructure, advanced equipment, and super-specialist manpower for specialised treatments.

• Ex. Empanelment for cardiology may require a functional Cath Lab, while oncology may require specific radiation therapy equipment.

Step 2: Gather Documents

• Institutional Documents:

• Hospital Registration Certificate.

• All statutory licenses mentioned in Step 1.

• PAN Card of the hospital or its parent entity.

• Financial Documents:

• A cancelled cheque leaf clearly showing the hospital's bank account details.

• A Bank Mandate Form (download from the application portal, fill out, sign, stamp, and then scan).

• Quality Accreditations (if applicable):

• NABH Accreditation Certificate or PM-JAY Quality Certification (Bronze, Silver, Gold). These are optional but recommended, as they can fast-track your empanelment process.

• Also, hospitals with PM-JAY quality grades (Bronze, Silver, Gold) are eligible for higher package rates (5%, 10%, 15% respectively).

Table 1: Document Checklist

Step 3: The Online Application

(Tip: Ensure your hospital is "inspection-ready" when you submit your application.)

All applications must be submitted through the central, web-based Hospital Empanelment Module 2.0 (HEM). 

#1: Register on the HEM Portal

1. Access the Portal: Navigate to the official PM-JAY website (pmjay.gov.in) and find the link for the "Hospital Empanelment Management (HEM)" in the top-left drop-down menu to reach the portal (hospitals.pmjay.gov.in). 

(Update: the portal has been shifted to HEM 2.0: hem.nha.gov.in )

2. Create Your Account: First-time users must create an administrator account. Use a reliable mobile number and email address, as your login credentials will be sent there.

3. Activate Your Account: You will get a unique Hospital Reference Number & one-time password (OTP). Use these to log in for the first time. Now set a new, permanent password and answer three security questions for future recovery.

#2: Complete & Submit the Application

1. Fill Out All Sections: Log in with your new password and fill out every section of the online form. You can save your progress at any time. It includes:

• Organisation: Name, address, ownership type, contact info, etc.

• Infrastructure: Beds, OTs, ICUs, Backup power supply, etc. 

• Equipment: Ventilators, Monitors, Diagnostic Machines, etc.

• Manpower: Personal & professional details of the staff (medical, technical, & non-medical). At least one medical and one technical is mandatory.

• Licenses: Hospital’s Registration Certificate, Pollution Control Board Certificate, NABH, etc.

2. Upload Documents: Upload the scanned documents you prepared in Step 2 into the appropriate sections.

3. Final Review and Submission: Before submitting, use the "Check Eligibility and Submit" feature. The system will flag any incomplete or incorrect sections in red. Once everything is correct, tick the final declaration and click "Submit".

Step 4: Verification and Approval

Once submitted, your application is first verified by the District Empanelment Committee (DEC) and then approved by the State Health Agency (SHA). This should take a maximum of 30 working days from the date of submission.

1. Desktop Verification: The DEC matches the filled application info with the uploaded docs info. Minor issues may mark your application as "clarification required," giving you 30 days to provide the necessary information.

2. Physical Inspection: Then, an inspection team visits the facility to confirm the presence and functionality of all the declared assets (infra, staff, equipment, etc.). They also take original, time-stamped, and geo-tagged photos as evidence.

3. Final Decision by SHA: The SHA approves or rejects your application after considering the DEC’s report & recommendations. You will be notified of the decision via SMS and email.

Step 5: Final Onboarding

Approval is the final hurdle in the application process, but a few key steps remain to become fully operational.

1. Memorandum of Understanding (MoU): Within 2-3 days after approval, the system will generate a legal contract (MoU) with details like payment terms, legal obligations,  & package rates. You must sign it and ensure the SHA countersigns it within 7 working days post-approval.

2. IT System Integration: Your hospital will be onboarded onto the PM-JAY IT platforms. Your staff must be trained to use the Beneficiary Identification System (BIS) (to verify patients) and the Transaction Management System (TMS) (to manage pre-authorizations and claims). 

3. Establish On-site Support: It is mandatory to set up a dedicated PM-JAY Kiosk or help desk at a visible location in your hospital. This kiosk must be staffed by a trained Arogyamitra, who acts as a facilitator to guide beneficiaries through the entire cashless process. 

State-Level Variations

For example:

• Karnataka

• Scheme Name: Ayushman Bharat-Arogya Karnataka (AB-ArK), managed by the Suvarna Arogya Suraksha Trust (SAST). 

• Key Feature (Mandatory Referral System): For most complex and tertiary procedures, private hospitals can only treat patients who have an online referral from a public hospital.

• Referral Condition: The referral is issued only if the required treatment is unavailable at the public facility.

• Exception: Direct admission to private hospitals is allowed for 171 specified emergency procedures without a referral.

• Maharashtra

• Scheme Name: Mahatma Jyotirao Phule Jan Arogya Yojana (MJPJAY), integrated with PM-JAY. 

• Key Feature (Universal Coverage): As of July 2024, the scheme covers the entire population of Maharashtra, expanding beyond the national PM-JAY beneficiary list. 

• Specific Criteria: A minimum of 50 beds for multi-specialty hospitals (relaxed to 20 in tribal/aspirational districts) and a quality-linked grading system that directly impacts payment rates. 

• Delhi NCR

• Implementation Status: Delhi is a late adopter, with formal implementation beginning April 5, 2025. 

• Governing Body: Department of Health & Family Welfare, Govt. of NCT of Delhi. 

• Process Alignment: The empanelment process is expected to follow the national NHA guidelines strictly. 

• Fast-Track Option: Hospitals already empaneled under other central schemes like CGHS or ESIC may qualify for an accelerated process. 

• Gujarat

• Scheme Name: Converged with the Mukhyamantri Amrutam (MA) Yojana. 

• Key Requirement (Bank Guarantee): Private hospitals must submit a bank guarantee as financial security, with the amount depending on the hospital's classification (up to ₹10 lakh). 

• Strict SOPs: The state has implemented stringent new Standard Operating Procedures, including mandatory video-recorded consent for major surgeries and the establishment of multi-disciplinary tumor boards for cancer care. 

• Tamil Nadu

• Scheme Name: Integrated with the mature, pre-existing Chief Minister's Comprehensive Health Insurance Scheme (CMCHIS). 

• Key Feature (Administrative Autonomy): The state has a highly developed and independent system for managing the scheme.

• Dedicated Portal: Tamil Nadu uses its own state-specific online portal for empanelment (claim.cmchistn.com). 

• Structured Process: The state has a well-documented, seven-stage online application process detailed in its own manual, which hospitals must follow precisely.

FAQs

Q1. What is Ayushman Bharat (PM-JAY)?
Ayushman Bharat (PM-JAY) is India’s largest public health insurance scheme. IT covers the bottom 40% households (as per the Socio-Economic & Caste Census 2011) and all citizens above 70 with a health cover of ₹5 lakh (each). Learn more here.

Q2. How long does the empanelment process take?
Typically, the process takes up to 30 working days from submission, including DEC verification, physical inspection, and SHA approval.

Q3. Can a hospital be empaneled for only some specialties?
Yes. Single-specialty hospitals may choose to empanel only for the procedures they offer, while multi-specialty hospitals are expected to apply for all specialties they can support.

Q4. Are quality certifications like NABH necessary?
They are optional but highly recommended. Quality certifications can help fast-track the process and even allow hospitals to charge higher package rates (PM-JAY Bronze, Silver, & Gold accreditation).

Q5. What documents are mandatory for empanelment?
Minimum requirements include hospital registration, statutory licenses (fire, biomedical waste), PAN, bank details, and staff credentials.

Q6. What happens after application approval?
Your hospital is issued an MoU, integrated into the PM-JAY IT platforms (BIS & TMS), and must set up on-site support for beneficiaries, usually with a trained Arogyamitra.

Q7. Are there state-specific differences in the empanelment process?
Yes. States like Karnataka, Maharashtra, Delhi NCR, Gujarat, and Tamil Nadu have additional requirements or variations, such as referral systems, bank guarantees, or separate portals.

Q8. Can a hospital lose its empanelment?
Yes. Non-compliance, fraudulent practices, or repeated claim irregularities can lead to de-empanelment or disciplinary action by the SHA.

Q9. Where can hospitals find the official application portal?
The latest portal is HEM 2.0:https://hem.nha.gov.in

As a doctor, you want to help people. Understanding India's government health schemes can help you serve patients who need it most. But this decision has a massive impact on your practice’s cash flow and long-term success.

Ayushman Bharat is the biggest national insurance scheme, and one wrought with countless difficulties. Navigating it successfully has potential benefits and drawbacks for any healthcare provider. 

If you are a doctor, hospital owner, or clinic manager in India unfamiliar with Ayushman Bharat and its many nuances, this article is for you. It is meant to give a simple, concise, & practical summary from start to end.

What Is Ayushman Bharat PM-JAY?

• Cashless health coverage of ₹500,000 for 10.74 crore (107 million) households on a family floater basis. These families, amounting to 55 crore (550 million) individuals, belonged to the bottom 40% of the Socio-Economic Caste Consensus (SECC) of 2011.

• Coverage for 1,929 procedures + all treatment costs. Includes pre-hospitalisation expenses for up to 3 days & post-hospitalization expenses for up to 15 days.

• In September 2024, the GOI expanded the scheme to include all 70+ senior citizens, regardless of their background, with additional coverage of ₹500,000. That’s another six crore (60 million) seniors the scheme now serves.

How PM-JAY Works: 

The backbone of this scheme is a massive network of around 28,000 “empaneled” public & private hospitals. Together, they work toward achieving universal health coverage. Every state has its own State Health Agency (SHA) in charge of the scheme’s implementation. They follow one of three models for logistics:

• Trust Model: SHA directly manages everything from claims to payments.

• Insurance Model: The SHA contacts one or more insurance companies to manage the logistics.

• Hybrid Model: Combines both in some capacity. SHA manages certain aspects, while insurance companies handle the rest. 

That’s the behind-the-scenes of how the scheme operates. Here is what you need to know as a healthcare provider.

1. Empanelment via HEM:

To accept patients under PM-JAY, private healthcare providers must get empaneled through the Hospital Empanelment Module (HEM). The process is designed to be simple: 

• Visit https://www.pmjay.gov.in/> Menu (Top-Left Corner) > HEM.

• Fill in the details, which are approved by the District Empanelment Committee (DEC) within 15 days, pass the physical inspection, and final approval from the State Empanelment Committee (SEC).

• Minimum requirements might include 10 inpatient beds with ample spacing and quality accreditations, depending on hospital type. (P.S. our PM-JAY: Empanelment Guide)

• Post-empanelment, HEM is also used to update hospital information, learn about new policy developments, view procedure package prices, and ensure compliance with all PM-JAY policies. 

Caution: There have been reports of bribery & corruption to fast-track the process. Empaneled hospitals are also subject to monitoring and disciplinary proceedings. Keep that in mind as you make plans for your practice.

2. Verification via BIS:

Once empaneled, the hospital can start treating beneficiaries (citizens benefitting from the scheme) & get reimbursed under PM-JAY. To do this:

• Once admitted, the hospital must verify the patient’s eligibility through the  Beneficiary Identification System (BIS). It does so by matching the SECC database.

• Staff can input patients' details, such as mobile number, name, age, gender, and Aadhaar number, or they can verify them via BIS with the PM-JAY card.

Note: In the future, the GOI might integrate the Ayushman Bharat Digital Mission (ABDM) with its insurance framework. This might provide the patient’s medical history on BIS.

3. Pre-Verification & Managing Claims via TMS: 

Then comes the most critical part of the process: documentation and managing claims. It’s done via PM-JAY’s Transaction Management System (TMS). How it works:

• A Pre-Authorisation Request (PAR) must be placed for the specific treatment package* in the TMS. The official Turn-Around Time (TAT) for this is just 6-12 hours.

• This request includes documents like the doctor’s notes & test results. These serve as evidence for the treatment’s necessity.

• Once the PAR is approved, the treatment is administered. After the patient is discharged, all final documents are uploaded & the claim is submitted for final adjudication & payment. The whole process happens through TMS.

• The official TAT for the final claim is just 15 days for in-state & 30 days for patients treated outside their home state.

*The GOI has taken a highly controversial measure to streamline the claims process and standardize the procedures covered under PM-JAY. They’ve done this by negotiating fixed rates for each treatment into “treatment packages.” 

Should Your Hospital or Clinic Join PM-JAY?

If you wish to empanel under PM-JAY, it’s vital to know the grave risks and potential opportunities associated with the scheme’s implementation. Here is a simple breakdown:

Pros

• The govt. benefits from private infrastructure, while private hospitals can tap into a new market. 

• Improves the country’s overall quality of life by giving at least some protection to the most vulnerable. 

• Hospitals can fill their beds and improve occupancy, which can lead to improved long-term revenue. They can leverage economies of scale. 

• Massive potential to immeasurably grow your hospital’s goodwill, long-term reputation, and positive impact. 

Cons

• Crippling cash flow disruptions due to systematic delays. According to an audit of the 2018-21 period:

• Pre-authorization usually took longer than the 12 hours, delaying treatment.

• 40.23 lakh claims worth ₹6,052.47 crore were still under process, awaiting approval or rejection.

• Precise documentation and administrative work. It is recommended to keep dedicated staff familiar with the HEM, BIS, & TMS to avoid mistakes.

• Fixed, pre-defined, often lower package rates for procedures (40-50% less than market rates, in some cases). 

• Being forced to “cherry-pick” viable procedures to make ends meet. 

• Ex. A chronic disease treatment might cost more resources than the scheme compensates for. 

• Meanwhile, a complex cardiovascular surgery might cost less than the fixed rate, making it more profitable.

Key Considerations for PM-JAY Participation

It’s important to note that even large, well-established hospitals have said that they make “no discernible profits” from PM-JAY patients and participate primarily to support the needy. 

This does not mean that Ayushman Bharat is a total failure or that treating its beneficiaries is a total loss. Hospitals can earn profits by increasing the volume of treatments. But participation does carry significant risks. Here is our recommendation to balance the two (read our full article on PM-JAY: Best Practices for more):

• Do thorough local research. Reach out to medical associations, look at your state’s PM-JAY data, and even reach out to empaneled hospitals for a feasibility study.

• Prepare for delays without normalising them. Stress-test your financial models for liquidity on 6, 9, & 12-month cycles. Know your threshold for delays according to your required cash flow.

• Dedicate a staff member to specialise in the PM-JAY process. Ensure pristine documentation, systems, and policy compliance to minimize delays and claim rejections.

Conclusion

While Ayushman Bharat has weathered a hurricane of justified criticism and still struggles with massive challenges, hope still lives on. Being one of the most ambitious schemes of its kind, failures and roadblocks are to be expected.

The question for doctors and hospital management is not “Will the scheme work?” but “How can we make it work?” Of course, the implementation has to be financially viable for real, sustainable improvement.

Ultimately, it’s up to the growing corporate medical sector and all its members to hold the administration accountable and lobby for systemic improvements. Read our article on PM-JAY: All You Need to Know for more details.

FAQs

Q1:Who can be empaneled under Ayushman Bharat PM-JAY?
A: Private hospitals, clinics, and single-speciality centers meeting HEM criteria can apply. Government hospitals are automatically included.

Q2:How long does empanelment take?
A: Officially, 15 days at the district level + state approval. Realistically, delays can occur due to inspections, documentation, or other issues.

Q3:What is the Turn-Around Time for claims?
A: Officially, Beneficiary Verification: instant. Pre-authorization: 6–12 hours. Final claim approval: 15 days in-state, 30 days out-of-state. In practice, delays have been reported at various places. Conduct thorough local research to gain a better understanding.

Q4:Is participation profitable for hospitals?
A: It depends. High volumes and efficient management can make it viable, but cashflow delays and low package rates often pose risks.

Q5:Can hospitals update their procedures or policies after empanelment?
A: Yes, via the HEM portal. Updates must comply with PM-JAY policies to maintain empanelment.