Increasing socio-economic inequality within the healthcare delivery systems of India

Increasing inequality between the wide diversity of population of ‘haves’ and ‘have-nots’ in the socio-economic and cultural set up of India, clearly gets reflected in the healthcare delivery system of the country. Many research studies on this subject have established a clear relationship between healthcare services and socio-economic inequality. Several lakh of Indians still perish in the country because of this reason.
Economic growth needs to be inclusive – better said than done:
Initiation of financial reform measures since 1990 and the process of globalization during this period have spurred the economic growth of the country, the rate of which comes just next to China in the global scale of comparison for the same. However, many people strongly believe that this reform process has not been as inclusive as it should have been. Otherwise why will the country continue to witness worrisome instances of abject poverty within a large section of the society with an abnormally high rate of mortality?

Healthcare sector in India – huge socio-economic inequality:

According to the Investment Commission of India, the healthcare sector of the country has experienced rapid growth of around 12% since last 4 years and is expected to be of U.S. $ 280 billion industry by 2022.

However, due to socio-economic inequality, this growth has not been evenly distributed. As a result, 65% of the population of India still do not have access to modern medicines and a vast majority of the population experience poor healthcare facilities. Around 10 lakh women and children die in India either due to poor access to healthcare services or they cannot afford the healthcare expenses.

Centers of excellence – but not for all:

In the healthcare sector, despite having many centers of excellence of global standards, which are also attracting ‘medical tourists‘ from across the world, healthcare needs of a large number of population of the country are not being addressed adequately. About 700 million of population have no access to specialists’ care even today. The Government of India alone will not be able to address this problem of gigantic proportion without workable and time-bound Public Private Partnership (PPP) initiatives with an investment of over U.S $ 20 billion at least for next five years. For example, in terms of availability of hospital beds per 1000 population, India stands at 0.7 against 3.96 of world average.

“Fortune at the bottom of the pyramid” – anybody follows in India?

Professor C. K. Prahalad’s famous dictum, “Fortune at the bottom of the pyramid” has not been realised yet by many within the global healthcare industry, perhaps with the solitary exception of Andrew Witty, the young CEO of GlaxoSmithKline.

As per data available from the Government publications, the bottom of the pyramid where a large proportion of the Indian population is located, reflects a huge socio-economic inequality even in the healthcare sector as follows:

• Overall spending on healthcare in India is around 6% of GDP (Public and Private sectors put together). However the public expenditure is only 0.9% of the total spending.

• In rural areas per capita expenditure on healthcare is seven times lower than urban areas.

• In rural areas the ratio of hospital beds to population is fifteen times lower than the urban areas.

• In rural areas the ratio of doctors to population is almost six times lower than the urban areas.

• The rate of Infant Mortality in the 20% of the poorest population is 2.5 times higher than the richest 20% of the population in rural areas.

• Despite more health issues an individual from the poorest quintile of the population is six times less likely to access hospitalization than a person from the richest quintile in rural areas.

• From the poorest quintile of the population, the child delivery of a mother is over six times less likely to be attended by a medically trained person than during child delivery of a mother from the richest quintile of the population in rural areas.

• On an average 78% healthcare expenditure in India comes as ‘out of pocket payments’ by the people, whereas only 18% of the same is borne by the state followed by 4% by medical insurance.

• Towards public healthcare spending, only five other countries in the world (Pakistan, Burundi, Myanmar, Cambodia and Sudan) are worse off than India.

• Only 38% of all Public Health Centres (PHCs) have essential manpower and only 31% have the essential supplies with only 3% of PHCs having 80% of all critical inputs.

As a result of inadequate and unequal spending on the healthcare infrastructure, healthcare systems, healthcare financing and healthcare delivery, both by the public and private sectors in the rural areas, such inequalities towards access and affordability of the healthcare services,especially in rural India where over 70% of the country’s population reside, have now assumed an alarming proportion .

Access to healthcare is fundamental in many countries of the world:

Most of the developed countries of the world extend comprehensive healthcare access to its citizens. Even our close neighbour Thailand and Fidel Castro’s land, Cuba along with many other developing countries of the world extend basic healthcare facilities to all their citizens.

Urban poor also face the harsh reality of healthcare affordability issue:

Survey results indicate the following facts so far as urban poor are concerned:

• Healthcare facilities though skewed towards urban India, the healthcare cost, lack of culturally appropriate services; social prejudices etc prevent access to healthcare even to the urban poor.

• Infant and under-five mortality rates in the urban slums for the poorest 40% are as high as is prevalent in the rural areas.

• Because of mainly poverty, poor hygienic and almost non-existent sanitation conditions, urban slums have now become the breeding ground for diseases like cholera, malaria, hepatitis, tuberculosis, HIV – AIDS and a large variety of infectious disease.

All these conditions coupled with almost total lack of health education in slums further aggravate the healthcare situation.

Has the National Health Policy delivered?

It is widely believed that Infant and Maternal Mortality rates of a country are the most important indicators of the health of any society. For the year 2000 The National Health Policy of India had set a target to bring down the Maternal Mortality Rate to below 200 per 1 lakh live births. However, even today around 407 mothers die every year due to pregnancy related complications. So far as infant mortality is concerned the figure remain as high as 22 lakh every year.

A very sad state of public healthcare delivery system gets reflected through these very basic numbers, despite various government initiatives and mushrooming private and corporate investments towards healthcare. The privileged class of the society, as a result, is getting better and better private healthcare services and the under-privileged class is denied of, in many cases, even the very basic healthcare facilities. All these bring out to the open the social and economic inequality in our civil society even for the very basic healthcare needs of its citizens.

Growth of Private Healthcare initiatives is welcome, but are they maintaining an urban-rural balance?

Urban centric private healthcare sector in India is growing at a faster pace. However, overwhelming dominance of this sector in absence of robust PPPs will further increase the urban bias with focus on higher profit margin being more important than offering primary and secondary healthcare services to a large number of the deprived population with lesser profit margin. Following published facts may help understand the prevailing situation:

• The increasing cost of healthcare paid predominantly through ‘out of pocket’ is making healthcare unaffordable to a large number of the population.

• The number of people who are unable to seek healthcare services due to affordability issue is growing, despite rapid economic growth of the country.

• The number of people who cannot afford to basic healthcare services has doubled compared to just a decade ago.

• One in three people who need hospitalization and paying ‘out of pocket’ are forced to borrow money or sell assets to cover healthcare expenses.

• Because of ‘out of pocket’ spending on healthcare, over 20 million Indians are pushed below the poverty line every year.

• A World Bank report acknowledges the facts that doctors recommend unnecessary investigations and over-prescribe drugs in private healthcare sector.

• The same report acknowledges the relationship between the quality and cost of healthcare services in the private healthcare system with high priced services being excellent but unaffordable to many.


All these facts will further establish the prevalent socio-economic inequality within the healthcare delivery systems of India. Rapidly growing urban centric private healthcare initiatives are welcome but these are now just catering to the privileged few, keeping the pressing healthcare issues of India unanswered. Only well planned time-bound PPP initiatives, in my view, are capable to address the humongous healthcare issues of India.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

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