Only major investment can save India’s health care sector


Only major investment can save India’s health care sector

Indian Prime Minister Narendra Modi. (Reuters)

A few months ago, amid much fanfare, Indian Prime Minister Narendra Modi launched a health insurance scheme for the poor. Touted as the world’s largest health care system, the scheme was quickly branded “Modicare” by his supporters.

The scheme aims to provide insurance coverage for treatment of up to 500,000 Indian rupees ($7,000) to a family. In theory, the scheme should cover 500 million people, roughly a third of the country’s population. The government claims that more than 100,000 people have already benefitted from the scheme.

But as with anything under the Modi government, the scheme was launched without proper groundwork to ensure its success or even sustainability. For a target of 500 million people, it remains hugely underfunded as it has received a fraction of the money that an Indian city, say Mumbai, spends on health care every year. It also fails to address the real issue in health care: Access to a doctor or even a primary health care center.

Before going gaga over “Modicare,” the government would have done better to study two reports released in the same year that point to the real challenges facing the Indian health care system. One is access, and the other is the quality of treatment available for a large majority of the population.

A report by The Lancet put India at 145th out of 195 countries in terms of quality and access to health care. India lagged behind not just China but also many of its South Asian neighbors such as Bhutan, Bangladesh and Sri Lanka, all developing countries. India has certainly progressed over the years, as its score for access and quality improved from 24.7 in 1990 to 41.2 in 2016. But even now it lags behind the global average, which was 54.4 in 2016.

One of the main reasons behind the poor showing by India is that it is simply not investing enough in health care. With an expense of about 1 percent of gross domestic product every year, India’s budget for health care is among the lowest in the world. Over decades, this low investment has created a huge demand-supply gap.

As a result, the government has neglected to set up new hospitals at a pace to keep up with the rising population, and it has failed to upgrade or modernize existing hospitals. They are also short of qualified doctors and nurses, and almost always lack medicines and other necessary medical consumables.

To fill this gap, at least in a small part, the private health care industry has boomed, with dozens of chains of hospitals springing up across the major metros and urban centers in the country. This has resulted in making access to health care highly unequal, and over time this inequality has risen sharply.

Hence today many large cities are perhaps full of hospitals and treatment centers, most of them private, while most villages do not even have a primary health care center, a dispensary, or even a trained medical worker to attend to residents’ needs. This despite more than 60 percent of the Indian population residing in villages, many of them so remote it can take almost a day to go to the nearest hospital.

Despite a booming economy, the country’s poor remain deprived of access.

Ranvir S. Nayar

The Lancet study reveals that the gap in access and quality of health care had increased significantly to 30 points, meaning that some parts of India, such as the state of Uttar Pradesh with a population of more than 220 million, had a score almost as bad as Afghanistan, which was ranked 191 out of 195 countries.

Another challenge for India’s people and government relates to the cost of treatment. With public hospitals remaining few and ill-equipped, most patients are forced to turn to the private sector for their treatment, and these are priced out of reach not just for the poor but also the middle classes. The hospitals remain largely unregulated, and pricing is predatory in many cases.

Many of them have been provided free land, or land at a steep discount, on condition that they provide free treatment to the poor for at least 10 percent of their beds. But these conditions remain only on paper, while the hospitals continue to milk their patients, irrespective of their paying capacity.

One of the biggest factors behind indebtedness in India is medical treatment. According to a study, poor health and cost of treatments are responsible for pushing up to 5 percent of the population below the poverty line.

India has already had various public-funded health care insurance schemes, targeting the poor, for over a decade. Yet their impact on health, as well as their implementation, has left a lot to be desired. Some studies found that hospitals covered by the scheme forced patients to pay more, not just for the treatment but also for post-operative and post-hospitalization care.

These challenges have not been addressed by the latest scheme, and the lag in health care provision vis-a-vis demand continues to rise. With a large number of people aging each year, and with the spread of lifestyle diseases, the number of people needing medical attention will keep rising.

If there is no serious increase in funding health care, India will continue to lag behind its neighbors, and will fall back in the global ranking even further.

  • Ranvir S. Nayar is managing editor of the Media India Group, a global platform based in Europe and India that encompasses publishing, communication and consultation services.
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