State of Health Sector in India
The National Health Accounts data for 2013-14 present fresh evidence that India continues to have a non-serious approach to the provision of universal health coverage to all its citizens. India’s health system is one of the most privatised in the world, poorly regulated and accessible only to those with income levels well above the average.
All these attributes are, once again, strongly borne out by the NHA data, which lay bare the extremely low government spending on health which, at 1.15 per cent of GDP, compares poorly with even Sub-Saharan Africa. There, World Development Indicators say, the corresponding figure was 2.9 per cent six years ago.
1. The share of State governments, which are largely responsible for provision of health care, in government health expenditure is estimated at 0.75 per cent of GDP.
2. A staggering 64.2 per cent of health expenditure, is met by households out-of-pocket.
What needs to be done?
1. If the NDA government intends to pursue its promise of universal health assurance in earnest, and wants to make up for two lost decades of reform, it has to act decisively. Raising government expenditure on health, in conjunction with the States, should form the basis of policy change; the road map for this was proposed by the Planning Commission’s High Level Expert Group in 2011.
2. Remedial policies in two key areas can quickly scale up to reduce the OOP (Out of Pocket) burden on households. One is to put in place a centralised system for procurement of essential drugs, relying mainly on quality generics and distributing them through the State government system. The other is to arrive at the cost of all medical procedures for different classes of hospitals, laying down standards and forming regulatory authorities at the State and district levels under law to enforce the rules.
3. It was estimated by the Planning Commission group, for instance, that spending 0.5 per cent of GDP (compared to 0.1 per cent spent by the public health system) could ensure the availability of essential medicines free of cost to all Indians. Regulatory controls would automatically lead to a reduction in costs, and curbing of unethical and corrupt practices by hospitals and diagnostics centres. It should then be easier to quickly extend free health insurance to more classes of people, such as senior citizens, children and the disabled, and achieve universal coverage early.