New Delhi: India’s National Health Authority (NHA) has imposed penalties worth ₹114.06 crore on 2,842 hospitals for alleged financial irregularities and fraudulent claims under the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) during the last financial year. According to the NHA’s 2025-26 Annual Report, the enforcement drive extended beyond financial penalties, with thousands of hospitals facing suspension or removal from the government’s flagship health insurance scheme. The authority said it is strengthening technology-driven monitoring systems to safeguard taxpayer-funded healthcare from fraud.
Investigations carried out by the National Anti-Fraud Unit (NAFU) resulted in 2,003 hospitals being de-empanelled from the scheme, while 839 hospitals were suspended. In addition, the NHA prevented the disbursement of ₹678.47 crore by blocking suspicious claims before payment, helping avert potential misuse of public funds.
The report states that the NHA has shifted from traditional post-facto audits to a pre-authorisation screening framework. Under this system, an automated adjudication engine reviews every claim to identify anomalies such as mismatches between a patient’s gender and the billed medical package, repeated claims for procedures that can only be performed once in a lifetime, and other unusual patterns. Every newly issued Ayushman card is also reviewed within 24 hours through a risk-based screening mechanism.
To further strengthen fraud prevention, the authority has introduced a Hospital Vulnerability Index Dashboard, which scores hospitals based on their fraud risk profile. For dialysis packages, considered particularly vulnerable to abuse, biometric authentication is now mandatory for every treatment cycle, replacing the earlier requirement of once-a-month verification.
Launched in September 2018, Ayushman Bharat is among the world’s largest publicly funded health insurance programmes. According to the NHA, the scheme has so far authorised nearly 119.3 million hospital admissions, with the total value of treatments reaching approximately ₹1.78 trillion. During the last financial year alone, 32.6 million new beneficiary cards were issued, while healthcare services worth ₹48,828 crore were provided under the programme.
According to Indu Bhushan, the founding Chief Executive Officer of the NHA and now a senior associate at Johns Hopkins University, the anti-fraud system operates on more than 100 continuously refined algorithms. These algorithms can detect medically impossible claims, such as a hysterectomy billed for a male patient, clinically implausible procedures, or records showing the same doctor performing numerous complex surgeries at different locations on the same day. Serious violations trigger automatic payment blocks, while minor coding errors are flagged for review.
However, private hospitals have expressed concerns over delays in reimbursements. Public health expert Dr. Rajeev Jayadevan, former President of the Cochin chapter of the Indian Medical Association (IMA), said that while a zero-tolerance approach to fraud is essential, enforcement must remain balanced. He noted that 16,436 private hospitals empanelled under AB-PMJAY have long complained of delayed payments, leading some facilities to remain officially empanelled while informally turning away scheme beneficiaries.
Experts believe that AI-driven surveillance and advanced fraud-detection algorithms have significantly improved the government’s ability to identify suspicious claims. At the same time, they caution that if enforcement mechanisms become more stringent than the payment and appeals process, compliant hospitals may also suffer. They argue that alongside preventing fraud, the system must ensure transparent, timely, and fair reimbursements so that beneficiaries continue to receive uninterrupted access to quality healthcare.
About the author — Suvedita Nath is a science student with a growing interest in cybercrime and digital safety. She writes on online activity, cyber threats, and technology-driven risks. Her work focuses on clarity, accuracy, and public awareness.
