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More than MVR 35 billion has been spent on health services and medical treatment over the past five years, according to a performance audit of the Aasandha health insurance scheme released today by the Auditor General’s Office.
The report said the state spent a total of MVR 35.8 billion on health services between 2019 and 2024, including expenditure under the Aasandha scheme and spending outside the scheme. This amounts to an average annual expenditure of MVR 5.9 billion.
According to the audit, Aasandha is the second-largest component of the state budget after hospitals. During the five-year period, MVR 16 billion was spent under the Aasandha scheme alone.
The Auditor General’s Office noted that while the number of people receiving Aasandha services increased by seven percent between 2019 and 2024, expenditure under the scheme rose by 32 percent during the same period.
Key Findings of the Audit
- Medicines are the largest cost driver, with Aasandha spending an average of MVR 924.8 million per year on drugs. This cost is increasing by around seven percent annually.
- Private healthcare spending totalled MVR 3.1 billion over five years. During this period, 83 clinics and two hospitals were placed under Aasandha. A total of MVR 779.8 million was paid to clinics. Although clinic spending remains relatively low, it is increasing by 18 percent annually.
- Visiting doctors are permitted to refer patients for overseas treatment, contributing to higher foreign medical costs.
- Overseas treatment expenditure reached MVR 1.6 billion between 2019 and 2024, despite the availability of specialists in Maldives for many of the conditions commonly referred abroad. Agreements with foreign hospitals to help develop local medical specialties have not been implemented.
- Aasandha expenditure is projected to reach MVR 4 billion by 2027, representing a 62 percent increase compared to 2019.
- The audit found that Aasandha is not operating as intended under the law. If a premium-based insurance model, as required by legislation, had been implemented, expenditure in 2023 could have been reduced by MVR 1.6 billion.
Recommendations
Auditor General’s Office recommended several measures to control rising costs, including:
- Implementing a Maximum Retail Price (MRP) system to reduce medicine costs
- Introducing a co-payment system for overseas treatment to increase individual responsibility
- Shifting to targeted subsidies for those most in need of state assistance
- Conducting research into diseases most commonly treated abroad and adopting preventive health measures
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