The Indian government has set aside a viability gap funding (VGF) under its massive insurance scheme to finance building hospitals in small towns. Two years after announcing the ‘largest health insurance scheme’, the government has been able to get nearly 10,000 private hospitals to partner out of over 31,000 in India.Some Indian private hospitals are hopeful that viability gap funding (VGF) can help sustainably operate hospitals in underserved areas. The VGF, which is proposed to come out of proceeds from the tax on medical devices, is meant for building hospitals in India’s most disadvantaged 112 districts—primarily across Uttar Pradesh, Bihar, Chhattisgarh and Jharkhand—where there are no private hospitals or they’re not empaneled with the government’s scheme.
