India already has health insurance by private companies but its probably not used extensively. Something like this is basically a government run insurance scheme - it will most likely be a no-frills service, offer standardized plans with fixed reimbursements and provide some tax benefits for enrollment. There is very little that can go wrong here and probably pretty good upside. This is the kind of things that make for very good politics and there is no harm in the govt. capitalising on it.
That being said most of India has access to govt. run hospitals which offer near free services. The article paints a grim picture of these facilities and that might be largely true but I frequent govt. hospitals all the time even if I can afford private. They are quick, almost free and doctors are pretty good.