J&K Hospitals Grapple with ₹275 Crore Ayushman Bharat Dues: A Deep Dive into the Healthcare Crisis

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• Introduction
• The Crisis Deepens: ₹275 Crore Outstanding
• The Root Causes of Payment Delays
• Shift to 'Trust Mode'
• Geopolitical Tensions and Rising Costs
• Severe Impact on Patients and Providers
• Threat to Operational Stability
• Supplier Halt and Service Suspension Threats
• Calls for Urgent Action and Future Outlook

Jammu and Kashmir's private hospitals are facing a severe financial crisis, with approximately ₹275 crore in pending dues under the Ayushman Bharat-PMJAY scheme, threatening the continuity of crucial healthcare services for thousands of beneficiaries across the Union Territory. This critical situation stems from payment delays, some dating back to 2021, and has led to an impending halt in services.

Introduction: Ayushman Bharat's Promise Under Threat

The Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) and its integrated SEHAT scheme have been transformative, aiming to provide universal health coverage to all residents of Jammu and Kashmir. Indeed, J&K is one of the few regions boasting 100% population coverage under this ambitious scheme, with 85 lakh registered Ayushman Cards and over 1 crore listed beneficiaries. However, the very foundation of this healthcare revolution is currently being tested by a staggering financial burden: an estimated ₹275 crore in unpaid dues owed to private hospitals and dialysis centers.

The Crisis Deepens: ₹275 Crore Outstanding

Private healthcare facilities in Jammu and Kashmir, comprising 135 empanelled hospitals and dialysis centers, find themselves in a dire financial predicament. Despite recent partial payments by authorities, an approximate sum of ₹275 crore remains outstanding under the AB-PMJAY scheme. This significant backlog has prompted the Association of Private Hospitals and Dialysis Centres to warn of suspending services. Earlier, the association had indicated outstanding payments of around ₹295 crore, and some reports even placed the figure at over ₹300 crore, prior to the recent minimal releases.

The Root Causes of Payment Delays

The protracted delay in payments is multifaceted, with some claims reportedly dating back as far as 2021, and a substantial portion pending since July 2025. Hospitals have consistently provided critical healthcare services, including surgeries, cardiac treatments, and dialysis, for over a year without timely reimbursement.

Shift to 'Trust Mode' Exacerbates Issues

A major contributing factor to the current crisis appears to be the State Health Agency (SHA) J&K's decision to adopt Policy PS-8 under AB-PMJAY and SEHAT on April 17, 2025. This policy ended its collaboration with a private insurance firm and transitioned to a trust-based model. Since this transition, the association reports that less than 30% of payments have been released, creating an “unprecedented crisis.” Additionally, hospitals are still grappling with pending dues from earlier policy phases, along with what they describe as unjustified deductions and rejections. An ongoing legal dispute between the government and IFFCO Tokio, a previous insurance company, regarding approximately ₹300 crore in wrongfully rejected and deducted claims, further complicates the financial landscape.

Geopolitical Tensions and Rising Medical Costs

Compounding the problem are external factors like global geopolitical tensions, including the Iran-US and Israel conflict, which have led to a significant increase in the cost of medical supplies. Hospitals report an 18-22% surge in prices for essential items, further straining their financial resources in the absence of timely payments.

Severe Impact on Patients and Providers

The financial strain on the 135 empanelled private hospitals and dialysis centers is immense, pushing many to the brink of operational instability. Hospital administrations have warned that the continuity of healthcare services for thousands of beneficiaries is at risk.

Threat to Operational Stability

The prolonged delay in payments has crippled hospitals' ability to meet their operational expenses, including staff salaries and routine functioning. Many healthcare workers and their families have reportedly suffered months of hardship due to unpaid dues.

Supplier Halt and Service Suspension Threats

The crisis extends beyond hospitals to their supply chains. Suppliers of medical equipment and consumables had set a deadline of mid-April for the settlement of outstanding dues. As payments remain pending, many vendors have curtailed or completely halted the supply of essential items, such as implants and critical medical devices, directly impacting patient care. The Private Hospitals and Dialysis Centres Association formally communicated to SHA CEO Anant Dwivedi on April 6, stating that continuing services after April 15 would be impossible due to financial constraints and supply shortages.

The potential suspension of services under the 'Golden Card' scheme, which provides cashless treatment for critical procedures like surgeries, cardiac treatments, and dialysis, would disproportionately affect lower-income patients who rely on it as their primary means of accessing hospital care.

Calls for Urgent Action and Future Outlook

The Association of Private Hospitals and Dialysis Centres has urgently appealed to authorities to release the pending payments. This is crucial to ensure that empanelled institutions can continue providing uninterrupted healthcare services under the PMJAY SEHAT scheme. They have underscored that the crisis is no longer solely financial but directly impacts patient lives. While the State Health Agency has reportedly released a mere 1-2% of the outstanding dues recently, the vast majority of payments remain pending, leaving hospitals in a severe financial crisis. The situation presents a critical test for the administration, with the continuity of healthcare access for thousands depending on a swift resolution.

The transformation of healthcare infrastructure in regions like GMC Rajouri under Ayushman Bharat highlights the scheme's potential, making the current payment crisis in J&K even more critical. Ensuring the smooth functioning of private hospitals, which play a significant role in India's health revolution, is vital for the scheme's overall success. For a broader perspective on how private hospitals engage with the scheme, refer to Ayushman Bharat: Parliament Reviews Private Hospital Engagement in India's Health Revolution.