Pocket-friendly healthcare mooted

Recommending doubling of government spending on healthcare services, the Economic Survey found that it will reduce out-of-pocket expenditure of citizens from 65 per cent to 35 per cent.

India has one of the highest levels of out-ofpocket expenditure (OOPE) in the world, contributing directly to the high incidence of catastrophic expenditures and poverty. OOPE for health increases the risk of vulnerable groups slipping into poverty because of catastrophic health expenditures.

Hence, the survey “strongly” recommended an increase in public spending on healthcare services from 1 per cent to 2.5-3 per cent of GDP, as envisaged in the National Health Policy 2017. It observed that the health of a nation depends critically on its citizens having access to an equitable, affordable and accountable healthcare system.

OOPE as a share of total health expenditure drops precipitously when public health expenditure increases. Higher government spending can significantly reduce OOPE from 65 per cent to 35 per cent of the overall healthcare spend.

“The current healthcare expenditure of the government is 1.3 per cent and by including the private sector investments it can come up to 3 per cent of the GDP. The global average is 8 per cent and we have to at least double the spend to meet at least part of the required healthcare infrastructure. It has to be noted that two-third of the healthcare infrastructure is owned by the private sector with a higher concentration in metros and tier I cities,” said Kapil Banga, assistant vice president, Icra.

According to the survey, the Covid-19 pandemic has emphasised the importance of healthcare sector and its inter-linkages with other key sectors of the economy. A key learning emerging from the ongoing pandemic is that it has showcased how a healthcare crisis can be transformed into an economic and social crisis. To enable India to respond to pandemics, the health infrastructure must be agile. Further, India’s healthcare policy must continue focusing on its long-term healthcare priorities.