Audit Recommends Targeted Aasandha Benefits for Those in Need

The performance audit of the national Social Health Insurance Scheme has recommended shifting Aasandha benefits from universal coverage to a targeted model that prioritises those who genuinely require state assistance.

The audit, released yesterday by the Auditor General’s Office, reviewed the performance of both the Aasandha scheme and the National Social Protection Agency (NSPA) between 2019 and 2024. During this period, the state spent MVR 35.8 billion on medical treatment, averaging MVR 5.97 billion per year. Of this, MVR 16 billion was spent under the Aasandha scheme alone.

The report noted that expenditure under Aasandha rose by 32 percent, while the number of people using the services increased by only seven percent. Both Aasandha and NSPA continue to incur heavy annual costs, with spending last year exceeding the budgeted MVR 1.8 billion. By 18 December, MVR 2 billion had already been spent on Aasandha, alongside over MVR 300 million on medical welfare and MVR 3.4 billion on subsidies.

International financial institutions have long advised the Maldives to target medical assistance at low-income groups, but successive governments have not implemented these recommendations.

The audit proposes corrective measures, including the introduction of a targeted subsidy system, setting maximum retail prices for medicines, implementing a co-payment system for overseas treatment, and strengthening preventive healthcare to reduce long-term costs.

The recommendations come as the Maldives faces significant fiscal pressure, with USD 1 billion in debt due for repayment this year, including a single USD 500 million payment. Credit rating agencies have downgraded the country to “junk” status, increasing the cost of foreign financing. Despite this, the government maintains that all debt obligations will be met on time.

Medical Costs Rise 32 Percent 

The audit highlights that state spending on healthcare rose sharply over the past five years, while the number of people using Aasandha increased only slightly. From 2019 to 2024, expenditure under the scheme grew by 32 percent, compared with a seven percent rise in the number of beneficiaries.

The audit identifies medicines as the single largest cost driver, with an average of MVR 924 million spent annually and prices rising around seven percent each year. This increase is attributed to the failure to implement Maximum Retail Price rules, lack of price controls, non-compliance with existing regulations, and the addition of new medicines to the scheme.

Spending on private-sector services has also risen. Between 2019 and 2024, MVR 3.1 million was spent on private hospitals and MVR 779.8 million on clinics, with clinic spending increasing 18 percent annually. 

To address these challenges, the audit recommends fully implementing Maximum Retail Price rules, enforcing the National Social Health Insurance System Act and its regulations, introducing a co-payment system for overseas treatment, targeting subsidies to those who need state support, and reforming the medical welfare system.

Co-Payment System Proposed for Overseas Treatment

The Auditor General has recommended introducing a co-payment system for Maldivians receiving medical treatment abroad under Aasandha, requiring patients to contribute a portion of the total bill.

The audit found that MVR 1.6 billion was spent on overseas treatment between 2019 and 2024, averaging 14 percent of total Aasandha expenditure annually. The report highlights systemic issues, including the ability of visiting doctors to refer patients overseas and the continued rise in Aasandha spending.

The audit also emphasises the need to strengthen domestic healthcare capacity to reduce reliance on overseas treatment. Many cases continue to be referred abroad despite the availability of facilities in the Maldives, due to delays in implementing agreements with foreign hospitals and a lack of public confidence in local services.

Aasandha services are currently available in hospitals across India, Sri Lanka, Malaysia, and the Maldives. The government plans to expand the service to Bangkok, the UAE, and the Philippines.