The healthcare promise

As India prepares for the general election, government can facilitate stakeholders to provide universal care which will also create jobs

Asindiapreparesforthegeneralelections, it’s imperative to acknowledge healthcare as a vital investment for the nation’s wellbeing and prosperity. Despite its significance, healthcare often takes a back seat in political discourse. Instead of viewing it as a burden on the exchequer, we must recognisehealthcareasastrategicinvestmentthat yields invaluable returns in terms of human capital development, economic growth and sustainable development.

The first step towards prioritising health is to acknowledge its importance in the nationalbudget.thegovernmentiscommitted tospending2.5percentofthegdponhealth by 2025. Given that India’s GDP will grow to nearly Rs 323 lakh crore (US $3.8 trillion) by 2025, public health expenditure should rise to Rs 8 lakh crore, with the Centre contributing 40 per cent or Rs 3.23 lakh crore. But, the central budget allocation for 2024-25 is Rs 90,000 crore — only 28 per cent.

Addressing healthcare requires a fundamental change in mindset, with the government playing a catalytic role in transforming the landscape, leveraging the strengths of both public and private sectors, leaving behind the trust deficit between the two. By forging strategic partnerships and incentivising the private sector, which caters to nearly 70 per cent of healthcare needs, the government can ensure quality health services and bridge the existing gaps in the health system.

Take the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY). The programme provides a Rs 5 lakh hospitalisation cover for over 60 crore people. With this transformative change, the government moved from the role of a provider to a payer, recognising that providing healthcare services to 1.4 billion people is not a task that either the public or the private sector can achieve alone. More than 34 crore beneficiary cards have been distributed, over 27,000 hospitalshavebeenempanelled(43percent private and 57 per cent government hospitals) and 6.5 crore hospitalisations have already been accounted for under the scheme.

Two-thirds of the total money spent goes to private hospitals, which reaffirms patients’ preference for private hospitals. Most states have adopted the scheme but a majority of medium and large private hospitals have not joined the scheme, primarily due to low reimbursement rates. In 2018, FICCI analysed the cost of 10 in-patient procedures covered under AB-PMJAY across seven private and two public hospitals, including AIIMS New Delhi. It revealed that the reimbursement rates failed to even cover the costs incurred by hospitals by as much as 75 per cent for some procedures. Since then, the government has commissioned several costing studies under the Department of Health Research and Institute of Cost Accountants of India, for procedures covered under AB-PMJAY, but their findings have not been published. Irrationally fixing rates, without consideration of costs and delays in reimbursements, have acted as a deterrent for private providers’ participation in several health schemes. To draw more participation from the private sector, reimbursement rates must be corrected and a differential pricing model should be implemented to differentiate hospitals based on their clinical excellence, accreditations, scale and investment in technology.

But as the coverage expands, we will have to address infrastructure gaps in healthcare. India’s hospital bed density is 1.3 beds/1,000population,whichissignificantly below the recommended 3 beds/1,000 population mark — a deficit of nearly 24 lakh beds. In urban areas, more than 70 per cent of the bed capacity expansion in the last decade has been by the private sector. What is concerning is the slowdown in fresh investments, especially in tier 2, 3 cities and beyond.

The government needs to provide a conducive ecosystem and the private sector needs to reciprocate with quality, affordable healthcare services. It is high time that the health sector be accorded national priority status to make it eligible for priority sector lending, akin to agriculture, education, MSMES, housing, etc. This is nearly a decadeold appeal from the health sector stakeholders and even recommended by the Group of Ministers on Health in 2020. The government also needs to enable provisions of short-term interest free loans, subsidised loans with long repayment period, special land availability, tax incentives for infrastructure expansion and skilling HR, zero-rated GST, rationalisation of custom duties on essential life-saving items and productionlinked incentives for indigenous manufacturing of medical devices and drugs.

Further, strengthening primary healthcare through the 1.7 lakh Health and Wellness Centres (now renamed as Ayushman Arogya Mandirs) and creating a mechanism to cover OPD care under health insurance, will ensure better health outcomes, lower out-of-pocket expenditure and reduce the burden on secondary and tertiary hospitalisation.

Non-communicable Diseases (NCDS), also known as lifestyle diseases (diabetes, hypertension, heart diseases, cancers, strokes, chronic respiratory diseases, kidney, liver and mental health disorders) have risen to account for about 65 per cent of all mortalities in the country. NCDS can be largely preventedandcontrolledbyinterventionsat the primary healthcare level, thus preventing a significant number of complications, morbidity, mortality and instances of hospitalisation.

To support the entire healthcare ecosystem, we need a huge healthcare workforce. It is no surprise that healthcare is the fourth largest employer in the country. Given the astounding number of vacancies against sanctioned posts at various levels of the public health system and the expansion of healthcare infrastructure, the health sector has the potential to add 4 crore jobs. This can be a significant contributor to addressing the unemployment challenge and act as a GDP driver.

The time for action is now, and with adequate political will and commitment, the dividends of investing in healthcare will resonate for generations to come.