Savitha Kuttan,
The finance minister’s decision to increase the budgetary allocation for education and upskilling in the medical sector was a long-expected and welcome move. At present, the doctor-patient ratio is 1:1445 against the WHO recommended 1:1000 and the nurse-patient ratio is 1:483 against the ideal 1:4. In accordance with the intention to foster more public-private partnerships, the government has already allowed medical colleges to be set up and managed as a joint venture between companies and trusts. Although the National Medical Commission was established to address the skill gap in the health sector, we expect more clarity from the government on its plan to increase graduate and postgraduate seats in medical education. To ensure that the central funds are put to quick use, the government must also ease the rules and regulations to help set up more medical institutes, which will help produce more healthcare professionals and fill the gap.
In line with its intention to increase public spending on health to 2.5 percent of the GDP by 2025, the government has increased the fund allocation for the health sector to 69,000 crores and announced its plans to expand its flagship Ayushman Bharat Scheme to set up more hospitals in tier 2 and tier 3 cities. The plan to set up these hospitals via public private partnerships under the support of the viability Gap Funding Scheme of 2004 is a positive move. the VGF scheme has benefited regional airport developments and metro rail projects across the country, and there is no reason it will not work in the health sector if the stakeholders play their cards right.
The private sector has long been looking for incentives to increase health investment in underserved areas, and this move is clearly an invitation from the government seeking their involvement. The decision to use the taxes levied on medical equipment to boost the health infrastructure in tier 2 and tier 3 cities is also a sustainable move as it will increase healthcare accessibility, and in turn boost the sale of medical devices. If these measures are followed up with tax breaks for private players looking to invest in underserved areas and government help in land procurement, it will make a world of difference to people without access to quality healthcare.
Founder & CEO, Crediwatch