Healthcare: India’s Most Neglected Sector

Healthcare:

India’s Most Neglected Sector

As per the government only, India needs an investment of $200 billion by 2025 to meet the global norms of three beds per 1,000 people, as per our estimates.

By Santosh Sharma

At times, the most important things are least talked about. India’s healthcare system both in urban and rural sector is a state of tatters and also in dire need of funds to employ more doctors and nurses and build more hospitals and better run primary health centers in rural sector. Moreover, India is among the countries having the lowest public healthcare budget in the world, with the public healthcare system in the country merely getting 1.26% of the total GDP.

Compare this with countries like the United Kingdom, Netherlands, New Zealand, Finland and Australia where all these countries spend over nine percent of their total GDP in public healthcare system, while countries like the United States spends over 16% of their GDP in public healthcare, and Japan, Canada, France, Germany and Switzerland spend about 10%.

Even some of the developing countries of the world have more contribution towards the public healthcare system with regards to their GDP compared to India. For example, Brazil has a total budget of over 8% of its total GDP towards public healthcare expenditure. Even neighbouring countries like Bangladesh and Pakistan have over 3% of their GDP going towards public healthcare system.

The National Health Policy of 2017 recommends government expenditure on health to be increased to 2.5% of GDP by 2025, but that seems to be a distant dream still, since to reach the set target limit, the country needs to increase its health budget by 0.35% each year from now on. On the contrary, between 2015-16 to 202021 there has just been a mere increase of 0.02% in the health budget in India.

The National Policy also recommended that expenditure on health by states should be increased to 8% or more of their budget by 2020, but looking at the budget of different states in 2020-21, none of the larger states have allocated the stated budget. On an average, the state governments in India have just allocated 5.4% of their total budget. Andhra Pradesh, Jharkhand, Maharashtra, Karnataka, Haryana, Bihar and Punjab have allocated less than 5% of their total budget towards public healthcare between 2015-2021 financial year.

Even in the Healthcare Access and Quality Index released by the medical journal Lancet in 2018, India ranked 145th out of the 195 countries in terms of quality and accessibility to

healthcare, much lower than countries like China (48), Sri Lanka (71) and Bangladesh (133).

Failed Health System Triggers Vicious Cycle of Poverty and Misery

A high-level group on the health sector was constituted by the 15th Finance Commission in 2019 and headed by AIIMS Director Dr Randeep Guleria. The committee apprised, “To meet the ambitious targets of improvement in health services, there is a need for larger allocation of funds for the health sector in general. Not only is this a necessity because good health as a key enabler to a happy life is a goal in itself.”

It is also found that beside coronavirus pandemic, the continuous intake of heavily polluted air in urban areas is already doing damage to our lungs and is reducing the longevity by at least 2.6 years. People who are poor have to queue up in public hospitals to seek medical attention. It is a nightmare for patients to keep waiting in the queue for hours. Private hospitals are often more accessible but are unaffordable for the common person.

According to the Centre for Disease, Dynamics, Economics and Policy, Washington, there is a shortage of 600,000 doctors and two million nurses in India. The number of doctors per 1000 population in India is lower than in advanced and other middle-income countries with one government doctor for every 10, 189 people.

This makes the out of pocket expenditure in healthcare in India, as one of the highest in the world. Sixtyfive per cent of healthcare cost is being spent by patients themselves, pushing 58 million into poverty annually.

In 2016, WHO recommended that a country must have 44.5 health workers per 10,000 population to meet the Sustainable Development Goals and deliver Universal Health Coverage (UHC). Currently, we have half that number. With such a meagre spending on healthcare, how does the government hope for a rise in labour productivity? Take the case of German workers whose productivity is higher than most countries because of their robust health which is due to a good healthcare system.

As per the government only, India needs an investment of $200 billion by 2025 to meet the global norms of three beds per 1,000 people, as per our estimates. This is approximately the total National Infrastructure Pipeline (NIP) projected across all the infrastructure sectors. The current NIP shows a committed pipeline of $2.5 billion through the Centre and state governments. This means there is a gap of 99% of what needs to be invested for India to meet the global norms.

COVID CRISIS: A Lesson for Both India and US

India and the United States of America are the two largest democracies in the world. For most of this 21st century, they have served as solid examples for others to follow. The same cannot be said for their delivery of healthcare.

There are many differences between India and the US healthcare systems. The primary ones include the level of expenditure; the nature of healthcare support, and the nature of coverage. According to various reports, the US spends close to 18 per cent of its GDP on healthcare compared to less than just 4 per cent of GDP by India. The average expenditure per capita in the US more than $10,000 in the US and less than $100 in India.

This difference is huge. So, too is the nature of healthcare support. In the US there is broad and extensive quality support through both public and private facilities. In India, the private sector dominates quality healthcare delivery which restricts access for many middle class or poor citizens.

It is also found that beside coronavirus pandemic, the continuous intake of heavily polluted air in urban areas is already doing damage to our lungs and is reducing the longevity by at least 2.6 years

This disparity is heightened by the fact that because a majority of Americans have some form of insurance coverage -- only 10 to 12 per cent have to pay for healthcare out of their own pockets. In contrast, around 70 per cent of Indians do not have any health insurance. So, they have to pay out of their own pocket for medical services. In spite of these differences which appear gargantuan, there are some similarities of considerable magnitude in the nature of the healthcare systems as well.

In the US and India alike, there are far too few medical facilities and medical professionals in rural areas. There used to be an adequate supply in the US but they have disappeared over the past few decades. There have never been enough in India in the rural areas where over 66 per cent of the citizens reside.

In both countries, businesses interests, hospitals, medical doctors and other influentials have a substantial impact on health policies. And, the individual states (50 in the US and 28 in India) determine to a great extent the nature of the public health system within their boundaries.

Those who fare most poorly in both the US and India are the poor. In the US, poor adults are five times as likely as those with good incomes to report being in fair or poor health. In India, a recent study found that the poor in the poorer states made higher use of public health services but were still paying higher out of pocket expenses than those in states that were more well off.

These similarities and differences highlight potential areas to address to improve the healthcare delivery in both countries. And, even though neither the US nor India are at the top of the list, they still have positive healthcare lessons they can teach each other.

The Affordable Care Act was signed into law by President Barack Obama in 2010. Its intent was to ensure access to quality healthcare for all Americans by providing affordable healthcare insurance coverage to over 55 million uninsured individuals. For a variety of reasons, the ACA has not rolled out as planned and it is threatened by the Trump administration. Nonetheless, it is estimated that it has added close to 20 million to the insurance rolls since its implementation.

India and the US can learn from each other. They can also learn by looking at best practices in healthcare around the world. The rankings show that both of these democracies have much room for improvement in healthcare.

These are moves in the right direction. India should carry on with them and other efforts and new initiatives to make its healthcare system one of the finest in the world. The US should do the same. This must be the case because in the final analysis, a healthy democracy depends on the health of its people. If they are cared for, they will care for their country and the democracy will thrive. n