Tag Archives: Modicare

For Affordable Access To Quality Healthcare in India, Invest Where The Mouth Is

Posted on by
Reply

On September 25, 2018, well-hyped Ayushman Bharat – National Health Protection Scheme (AB-NHPS), touted as the largest health scheme in the world, was launched in India. Prior to its launch, while announcing the scheme on August 15, 2018 from the Red Fort,Prime Minister Narendra Modi said: “The healthcare initiatives of the government will have a positive impact on 50 Crore Indians,” as it aims to provide a coverage of Rs 5 lakh per family annually, benefiting more than 10 Crore poor families.

Before this scheme was introduced, there were several public funded health schemes in India, introduced by different governments, like National Rural and Urban Health Mission (NRHM and NUHM), Rashtriya Swasthya Bima Yojana etc. Reports also capture that since independence efforts were ongoing in this area. But none worked, due to shoddy implementation. Let’s await the outcome of yet another new health scheme, introduced by yet another government – AB-NHPS.

According to the Government Press Release of January 11, 2019: Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana (PMJAY) aims to provide health coverage during secondary and tertiary hospitalization of around 50 Crore beneficiaries, allocating a sum of up to Rs. 5 Lakh per family per year. The key words that need to be noted is ‘the health coverage during hospitalization’. It also doesn’t cover primary care. Interestingly, some of the larger states, such as Punjab, Kerala, Maharashtra, Karnataka and Delhi are, reportedly, yet to come on board, Odisha has refused to be a part of the scheme.

Conceptually, the above new health initiative, aimed at the poor, is praiseworthy.  However, its relevance in reducing a significant chunk of one of the highest, if not the highest, ‘Out of Pocket (OoP’) expenses towards health in India, raises more questions than answers.

This is because, whether annual ‘OoP’ for health, incurred by the country’s poor population, goes more for hospitalization than Primary Health Care (PHC) involving common illnesses, is rather clear today. In this article, I shall dwell on this subject, supported by credible published research data.

But ‘the Primary Health Care (PHC) is in shambles’:

Since the focus of (AB-NHPS) on ‘secondary and tertiary hospitalization’, one may get a feeling that the primary public health care system in India is, at least, decent.

But the stark reality is different. The article titled, ‘Five paradoxes of Indian Healthcare,’ published inThe Economic Times on July 27, 2018 describes the situation eloquently. It says: ‘While the Supreme Court has held health care to be a fundamental right under Article 21 of the Constitution…The fundamental aspect of health care – the primary health care is in shambles. There is only one primary health care center (often manned by one doctor) for more than 51,000 people in the country.’

In addition, the World Bank Report also flags: ‘The tenuous quality of public health assistance is reflected in the observation that 80 percent of health spending is for private health services, and that the poor frequently bypass public facilities to seek private care.’ Although, World Bank underscored this problem sometime back, it persists even today, sans any significant change.

PHC has the potential to address 90 percent of health care needs:

For the better health of citizens, and in tandem to contain disease progression that may require hospitalization for secondary and tertiary care, government focus on effective disease prevention and access to affordable and high quality PHC for all, is necessary. ‘Evidences gathered by the World Bank have also highlighted that primary care is capable of managing 90 percent of health care demand, with only the remaining 10 percent requiring services associated with hospitals.’

Another article titled, ‘Without Primary Health Care, There Is No Universal Health Coverage,’ published in Life – A HuffPost publication on December 14, 2016, also vindicates this point. It emphasized: ‘Primary health care (PHC) has the potential to address 90 percent of health care needs. However, country governments spend, on average, only one third of their health budgets on PHC.’ The situation in India is no different, either.

This basic tenet has been accepted by many countries with ample evidences of great success in this direction. Curiously, in India, despite the public PHC system being in shambles, the government’s primary focus is on something that happens only after a disease is allowed to progress, virtually without much medical intervention, if at all.

Key benefits of a strong PHC system:

As established by several research papers, such as one appeared in the above HuffPost publication, and also by other research studies, I am summarizing below the key benefits of having an affordable and strong PHC network in the country:

  • Can manage around 90 percent of the population’s health care need, patients would require hospitalization for specialists care only 10 percent of the time.
  • Can help people prevent diseases, like malaria or dengue, alongside effectively assist them in managing chronic conditions, such as hypertension or diabetes, to avert associated complications that may require secondary or tertiary care.
  • At the country level, a strong PHC system would help detect and screen illnesses early, offering prompt and effective treatment. The system, therefore, will support a healthier population, and would ‘offer much more than simple reduction of the costs of a country’s health.’
  • A country can ensure greater health equity by providing PHC advantages of greater accessibility to the community, and across the social gradient.
  • In short: ‘The continuity and doctor–patient relationships offered by family oriented primary care, alongside the patient education, early intervention and treatment, chronic disease management, counseling and reassurance offered to patients would be impossible to provide in a secondary care setting.’

Thus, establishing a robust network of high-quality public PHC facilities in the country is a necessity. Simultaneously, patients should be made aware of visiting the nearest PHC as their first stop for affordable treatment, when they fall ill.

Annual ‘OoP expenses’ more on ‘out-patient care’ than ‘hospitalization’:

For illustration, I shall provide examples from just two studies, among several others, which found, average ‘OoP expenditure’ per family in a year, is more for ‘out-patient care’ than ‘hospitalization.’

Since long, ‘OoP expenditure’ on hospitalization was being considered as the most important reason for impoverishment. Probably, this is the reason why various governments in India, had launched various health schemes, covering hospitalization expenses of a large section of the poor population in the country. The most recent one being – Ayushman Bharat-National Health Protection Scheme (AB-NHPS), often termed as ‘Modicare’, launched in September 25, 2018.

That total ‘OoP expenses’ are more on ‘out-patient care’ than ‘hospitalization’ was emphasized even in the 2016 research article titled, ‘Out-of-Pocket Spending on Out-Patient Care in India: Assessment and Options Based on Results from a District Level Survey,’ published online by PLoS One on November 18, 2016.

Highlighting that ‘OoP spending’ at ‘Out-Patient Departments (OPD)’ or in clinics by households is relatively less analyzed compared to hospitalization expenses in India, the results indicate:

  • Economically vulnerable population spend more on OPD as a proportion of per capita consumption expenditure.
  • ‘Out-patient care’ remains overwhelmingly private and switches of providers -while not very prevalent – is mostly towards private providers.
  • High quality and affordable public providers tend to lower OPD spending significantly.
  • Improvement in the overall quality and accessibility of government OPD facilities still remains an important tool that should be considered in the context of financial protection.

Let me now cite the second example – analyzing the 60th national morbidity and healthcare survey of the National Sample Survey Organization (NSSO), the study found, ‘outpatient care is more impoverishing than inpatient care in urban and rural areas alike.’

Expert committee’s recommendations for focus on ‘primary care’ went unheeded:

That the government focus on public health care should be on PHC, along with prevention and early management of health problems, was recommended by ‘The High-Level Expert Group Report on Universal Health Coverage, for India.’ This committee was instituted by the then ‘Planning Commission’ of the country on November 2011. The report also suggested, such measures would help reduce the need of secondary and tertiary care, significantly. But not much attention seems to have been paid even on these critical recommendations.

Conclusion:

Going by what Indian government says, I believe, its ultimate goal is providing access to affordable Universal Health Care (UHC), for all. That’s indeed commendable. But as various research papers clearly indicates, the country will first ‘need to invest in a ‘primary-care-centered’ health delivery system, if universal access to health care is to be realized, ultimately.

From this perspective, Ayushman Bharat – National Health Protection Scheme (AB-NHPS) may be a good initiative. But it does not seem to merit being the primary focus area of the government in public health care. And, not more than establishing high quality and robust ‘primary health care’ infrastructure, across the country, for all. Nor will AB-NHPS be able to address higher average of out-of-pocket ‘outpatient expenses’ of those people who need help in this area, the most.

Considering the critical public health care issue in India holistically, I reckon, for providing affordable access to health care for all, the top most priority of the Government should be to invest first where the mouth is – to create affordable primary healthcare infrastructure of a decent quality, with easy access for all.

By: Tapan J. 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.

NHPS: “One Nation, One Scheme is Enticing”, But Will It Work?

Posted on by
Reply

Yet another slogan: “One nation – One Universal Health Coverage (UHC)” would indeed be enticing for many, including India.

Nevertheless, that’s just a hope. Let’s now try to get a message out of what has been recently happening around this area through some reality checks.   The reality is, during post union budget (2018-19) television discussions on the ‘National Health Protection Scheme NHPS’, various experts very enthusiastically created a general impression that the scheme is a game changer for India. Many of us also felt that India is moving fast towards a viable UHC in the country!

As a consequence of which, it was widely expected that State Governments, too, will make necessary provision in their respective health budgets towards this ambitious insurance-based healthcare project. This specific step is absolutely essential, as the State Governments are supposed to contribute 40 percent towards NHPS.

Is it happening that way?

Intriguingly, on March 9, 2018, when Maharashtra State budget was announced, one witnessed a different reality altogether on the ground. In its 2018-19 budget, the Maharashtra Government, reportedly, ‘slashed its budget allocation for the health insurance scheme for the poor by over 50 percent.’

The Finance Minister of Maharashtra announced an allocation of ₹576 crore for the ‘Mahatma Jyotiba Phule Jan Aarogya Abhiyan’ in 2018-19 as against the last year’s budget outlay of ₹1,316 crore for the same area.

Keeping this latest development just as an example, in this article I shall explore some of the recent developments on the much talked about NHPS. Before doing that, let me give a perspective on the NHPS.

NHPS: not a new promise:

Rekindling the perennial hope on UHC in India, ‘National Health Protection Scheme NHPS’ was first announced by the incumbent Government in its 2016 budget, but the scheme didn’t take off. In its first avatar NHPS offered ₹100,000 insurance cover, with a top-up of ₹30,000 for senior citizens.

“It couldn’t get implemented, but that scheme is now subsumed by this current scheme,” reportedly, justified Manoj Jhalani, Additional Secretary in the Ministry of Health and Family Welfare, who has been given additional charge and designated as Mission Director of Ayushman Bharat, currently.

There isn’t any doubt that NHPS has been recast in the Union Budget Proposal of 2018-19, with a slight modification in naming it to ‘Ayushman Bharat—the National Health Protection Scheme (AB-NHPS)’. The modified scheme is also termed by many as “Modicare”, probably following ‘Obamacare’ in the United States. The Union Finance Minister of India in his Budget speech also termed this scheme as ‘the world’s largest government funded healthcare program.’

A recast of insurance-based public health coverage:

As a part of ‘Ayushman Bharat Program’, the scheme will now provide health insurance cover of up to ₹500,000 to 100 million poor and vulnerable families. Its benefits are now expected to reach 500 million individuals – 40 percent of India’s population, raising health insurance cover by up to 17 times from the existing Rashtriya Swasthya Bima Yojana (RSBY) that pegs the health coverage at ₹30,000 per year.

Just to give a flavor of the past, the National Family Health Survey-4 (2015-16) indicates that in India only 28.7 percent families have, at least, one person covered by a health insurance policy.

In the health insurance coverage based NHPS, the center and states will split financing the scheme in a 60:40 ratio. However, it is still not clear how would they do it. Neither is it known how the NHPS will fit in with the existing RSBY or various already existing state level schemes.

Apprehension expressed by some States:

Several other Indian States, such as Kerala, Tamil Nadu, Andhra Pradesh, Telangana, Madhya Pradesh, Chhattisgarh, Karnataka, West Bengal and Rajasthan already have a similar health protection scheme in place. Probably because of this reason some of these states, such as West Bengal and Karnataka, reportedly, have raised doubts about whether they will actually join the scheme.

On the other hand, health officials from  Telangana, Tamil Nadu and Kerala intend to seek clarifications from the Centre on various aspects of the plans. As I mentioned before, this is mostly because all States will require to contribute 40 percent of total expenses towards funding the ‘Ayushman Bharat—the National Health Protection Scheme (AB-NHPS).’

A fresh evaluation: Experts don’t rate public health insurance schemes high:

Interestingly, some fresh apprehensions on the effectiveness of insurance-based health coverage continues to come up. One such is as follows:

“The current approach of National Health Mission – whereby states must pre-commit to expenditure allocations across 2,000 budget lines with no real flexibility to subsequently move expenditures between different line items – will render NHPS ineffective.”

This apprehension has been raised by none other than Dr. Arvind Panagariya, currently Professor of Economics at Columbia University and the Vice Chairman of the Government of India’s think-tank NITI Aayog, between January 2015 and August 2017. This article, titled “It’s all in the design: Ayushman Bharat can be transformational if the governance of public healthcare is altered”, was published in the Times of India on March 07, 2018.

Dr. Panagariya further observed: “For the poorest of the poor to seek private hospital care speaks volumes for their lack of confidence in the public healthcare system. Studies by experts do not give high marks to existing insurance schemes either.”

Some key observations:

In his above recent article, Dr. Arvind Panagariya made some key observations that include some of the following:

  • A 2017 study of the Rashtriya Swasthya Bima Yojana (RSBY), published in the journal Social Science and Medicine, concludes, “Overall, the results [of our study] suggest that RSBY has been ineffective in reducing the burden of out-of-pocket spending on poor households.”
  • In 2014-15, private hospitals treated 58 percent of in-patient cases in rural areas. Even among the poorest 20 percent rural households, 42.5 percent of the patients went to private hospitals for in-patient treatment.
  • Resource shortage has resulted in less than adequate infrastructure and personnel in the public health facilities. Consequently, in 2014-15, a mere 28 percent of those needing outpatient care came to the public health facilities. A hefty 72 percent of patients went to private providers.
  • Considering that the private providers are predominantly unqualified individuals, often having no more than a high school education and no formal medical education, such disproportionate reliance on them is indicative of a serious failure at the public health facilities, especially in rural India.
  • Design and implementation challenges facing NHPS are even greater. Hospitals will have an inherent interest in pushing patients towards more expensive procedures or towards procedures not even required. Any lack of clarity in delineating the included and excluded procedures will become a source of abuse.
  • Superior outcomes would require a fundamental change in governance whereby performers are rewarded, and non-performers are punished. The story on secondary and tertiary care is not especially different.

In my view, these observations are worth taking note of, urgently, and more importantly, by learning from the past, avoiding similar mistakes getting repeated. Meaningful implementation of NHPS on the ground should be a top priority, especially when around 7 percent of the country’s population gets pushed below the poverty line, every year, due to high out of pocket health expenditure.

I also discussed the subject in this Blog on February 05, 2018. The article was titled “Union Budget 2018: The ‘WOW’ Moment for Indian Healthcare?”

Conclusion:

Any meaningful initiative on public healthcare for all, will be wholeheartedly welcomed in India, just as many other announcements made earlier by various Governments over a period of time. AB-NHPS – although announced in the very last year of the incumbents Government’s first 5-year term, has attracted similar interest. No less enthusiasm was displayed by the stakeholders, when the NHPS was first announced in the 2016 Union Budget of India.

The good news is, in the midst of all this, on March 06, 2018, Prime Minister Narendra Modi has, reportedly, reviewed the preparedness for the launch of AB-NHPS.’ However, details of the same are not known to many, just yet.

That said, any type of insurance-based public health coverage, spanning across the length and the breadth of India, without access to well-equipped and well-staffed health facilities, currently poses a serious handicap for the nation. It may be a legacy factor, but nothing significant happened in the last four years, either. This is regardless of around 70 percent of the country’s population still live in rural India, with a sizeable majority denied of access to affordable health care, as up till now.

Let me come back to the basic question: ‘One Nation, One Scheme, though, is enticing, but will it work?’ I reckon, unlike, 2016, if NHPS is effectively implemented urgently, together with ‘Ayushman Bharat’ program in its entirety, as desired, things could possibly change for the better, in a medium to long term time frame.

However, it appears, a workable game plan of AB-NHPS is still unclear to many, including a large number of State Governments who are supposed to be the key implementers of NHPS. In this scenario, would AB-NHPS fetch any palpable near-term dividend to the target citizens, at least in 2018 or even in 2019?

By: Tapan J. 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.

 

Union Budget 2017-18: ‘Modicare’ Remains A Pie In The Sky

Posted on by
Reply

Universal Health Care (UHC), as narrated in the National Health Policy (NHP) 2015 (NHP 2015 Draft) of Narendra Modi Government, making health a ‘Fundamental Right’ for Indian citizens, was considered a profound step by many, both in its both content and intent.

Being enormously enthused with this development, in my article of April 06, 2015 in this blog, titled “Would Affordable ‘Modicare’ Remain Just A Pipe Dream In India?”, I also termed this new draft health policy as ‘Modicare’, just as a few others did. If implemented both in its letter and in spirit, NHP 2015 has the potential to overshadow even the ‘Obamacare’ of the United States, almost hands down. Although it’s an altogether different story that under the new President Donald Trump’s administration, this Act faces a real threat of extinction, at least, in its current Avatar.

Is health care also a serious political issue?

Prompted by what has been happening in the oldest democracy in the world, the above fundamental question does surface. Its answer could be both, ‘yes’ or ‘no’, depending on the voters’ awareness on the subject, and the importance attached to it for individual well-being, including work productivity.

However, in this article, to impress upon how important are the promises on health care to the common citizens in the oldest democracy, I shall draw two back to back examples of pre-election campaign promises related to universal health care in the Unites states, where the answer to the above question has been an emphatic ‘yes’. Thereafter, I would explore what is happening in India in this area to fathom what could its answer possibly be in the largest democracy of the world.

The United States:

On November 4, 2008, Senator Barack Obama of Illinois was elected as the president of the United States. Just in a year’s time ‘The Patient Protection and Affordable Care Act’ popularly known as ‘Obamacare’, was passed in the Senate on December 24, 2009, and passed in the house on March 21, 2010. It was signed into law by President Obama on March 23rd, 2010 and upheld in the supreme court on June 28, 2012.

By enacting this historic health care reform legislation, President Obama fulfilled his election campaign pledge to provide healthcare to all in the United States of America, almost immediately after coming to power.

Similarly, during his 2016 election campaign, Donald Trump pledged to repeal the ‘Affordable Care Act (Obamacare)’, if elected, calling it a “total disaster.” Accordingly, on January 20, 2017 – the same day of becoming the 45th president of the United States, in his first executive order, President Trump, told government agencies to scale back aspects of the Affordable Care Act – fulfilling his pledge to undo Barack Obama’s signature healthcare law that made medical services accessible to millions of Americans.

Whether, it is a good or bad decision may not be a point of discussion in this article, but so far as the pre-election pledge on health care reform is concerned, both the Presidents – Obama and Trump indeed ‘walked the talk’.

India:

Besides the above two examples, the general expectation of the stakeholders in India was that in the priority agenda of the new Government health care will feature much higher than ever before. This was because the main ruling party of the Government in power now had promised to deliver a robust healthcare reform in its Election Manifesto 2014, if it is voted to power. Let me just reproduce below some of those critical promises:

  • India needs a holistic health care system that is universally accessible, affordable, effective and drastically reduces the out of pocket spending on health.
  • The Party accords high priority to the health sector, which is crucial for securing the economy.
  • As NRHM has failed to meet the objectives, it will be radically reformed.
  • The overarching goal of health care would be to provide, ‘Health Assurance to all Indians and to reduce the out of pocket spending on health care’, with the help of state governments.
  • The current situation calls for radical reforms in the health care system with regards to national health care programs and delivery, medical education and training and financing of health care.

The manifesto then goes into the details of each reform areas, after stating, “the last health care policy dates back to 2002; India now needs a comprehensive health care policy to address the complex health care challenges, keeping in view the developments in the health care sector and the changing demographics. The party will initiate the New Health Policy.”

This expectation flickered yet again:

This expectation flickered yet again, when just on the eve of the 2017-18 Union Budget Session, no less than the President of India, honorable Pranab Mukherjee on the last Tuesday reportedly reiterated that his Government assures ‘Health care for all’.

It’s about three years since the new Government is firmly placed on the saddle, after being voted to power. Regrettably, much promised, the new and comprehensive health care policy of India is still not in place. Could it mean, unlike in the US, pre-election political pledges on health care is still not considered a top priority area for quick implementation either by the Indian voters or the winning political parties, post-election? Probably, it doesn’t also sound as vote catching as a plethora of other ‘developmental activities’, ‘Foreign Direct Investments (FDI)’ and ‘GDP growth’ do, for winning a national election in our soil.

In India, most of the population think or feel about medical treatment and prevention of diseases mostly when we ourselves, or our near and dear ones suffer from serious morbidity, or are almost in a dying condition from serious ailments. At that moment of truth, most of us face almost an insurmountable barrier to treatment access due to individual ‘affordability’ condition. In the absence of enough decent public health facilities, one is compelled to go for private medical services that cost a bomb, most of which being out of pocket. At other times, it does not seem to matter much to many, or becomes an integral part of a burning social, political or economic agenda. It has thus far remained a dormant need, which needs to be brought to open by creating greater awareness in ambitious India, even during and after bringing a Government to power.

The fastest growing nation incurs lowest public health expenditure:

Even post ‘Demonetization’ exercise in the country, India would continue to remain the fastest growing large country in the world. However, the Government allocates just around one percent of GDP on public healthcare expenditure, ranking among the lowest in the world, in this area. Regrettably, there does not seem to be an adequate realization both among the public, corporate head honchos, including a large section of the country’s highly partisan media that sans sharp focus on health care, this immaculate growth story can get adversely impacted, in the long run.

Incoherent union health budgets sans any report card on achievements:

Be that as it may, in this article, I shall present before you a snapshot of the health care budgetary measures announced by the Finance Minister in his Budget speech both in 2016-17 vis-a-vis in 2017-18. Thereafter, I would try to explore how incoherent these are, and without any comprehensive status report on time-bound set goals. This is important, as taxpayers hard earned money was spent on those ‘goodies’, probably to give an impression that health care has not been totally left out by the Government during its annual budgetary allocation.

To demonstrate how incoherent and ad hoc these health budgets are, let me place before you what were the key areas of Union Budgetary allocations in 2016-17. If I may refer to my article of March 07, 2016 in this Blog titled, “Healthcare: Unwrapping The Union Budget (2016-17)”, we shall find that the key features were as follows:

The previous Union Budget of 2016-17:

  • The Government will launch a new health protection scheme, which will provide health cover up to Rs. One lakh (Rs. 100,000) per family. For senior citizens, age 60 years and above, belonging to this category, an additional top-up package up to Rs. 30,000 will be provided.
  • To reinvigorate the supply of generic drugs 3,000 stores under Prime Minister’s Jan Aushadhi Yojana will be opened during 2016-17.
  • Starting a ‘National Dialysis Services Program’ to provide dialysis services in all district hospitals. The funds were to be made available through PPP mode under the National Health Mission. To reduce the cost, the budget proposed exemption of certain parts of dialysis equipment from basic customs duty, excise/CVD and SAD.

I am not sure how many stakeholders, if any, are aware of the exact status report on those proposals of the last year’s Union Budget allocation for health care. If that’s the prevailing situation, we now get another small bundle of different sets of ‘goodies’ in the Union Budget 2017-18, as follows:

Current Union Budget of 2017-18:

Even in the absence of a comprehensive National Health Policy, there are many other health related critical issues that may eventually impede the GDP growth rate of the country. A few examples of which are as follows:

  • The estimated premature deaths caused by cardiac ailments, stroke and diabetes, reportedly, will result in a loss of national income of over US$ 250 billion in the coming decade,
  • Mental health becoming a silent epidemic, affecting around 13 percent of the population and just 10 percent of them getting treatment,
  • Millions of families are unable to get access to secondary and tertiary care services for diagnosis and treatment of serious diseases, such as cancer, as they cannot afford private facilities, which gets compounded as India records one of the highest out-of-pocket health expenditure in the world, higher than even many lower income, lower-middle income, as well as the middle-income countries.

Nevertheless, the Union Finance Minister in his 2017-18 budget proposal announced a strong resolve for elimination of:

  • Kala-azar or Leishmaniasis and filaria by 2017
  • Leprosy by 2018
  • Measles by 2020
  • Tuberculosis by 2025

Unquestionably, these are grossly inadequate, especially, in young and ambitious India. Moreover, very people industry watchers would know whether the deadline set for each is achievable, and a periodic report card on the same will be made public or not.

Similarly, the government’s determination to reduce Infant Mortality Rate (IMR) to 28 by 2019 (39 in 2014) and Maternal Mortality Rate (MMR) to 100 in 2020 (167 in 2011-13) is also praiseworthy. However, both these, including tuberculosis prevention, diagnosis and treatment interventions, were a part of the Millennium Development Goals (MDGs) for India. These are an ongoing exercise set out in the Millennium Declaration in 2000. Moreover, why annual budgetary allocation only for those two now, out of 8 MDG goals?

A few other equally ad hoc health care measures, probably picked up at random, and announced by the Union Finance Minister in his February 01, 2017 budget speech were the following:

  • Rs 6,000 financial aid for pregnant women to cover hospital admission, vaccination and nutritional food.
  • Two new All India Institute of Medical Sciences (AIIMS) at Jharkhand and Gujarat.
  • 1.5 lakh health sub centers to be converted to Health Wellness Centers
  • Amendment of the Drugs and Cosmetics Rules to ensure availability of drugs at reasonable prices and promote the use of generic medicines
  • New rules for regulating medical devices to be formulated, which will be internationally harmonized and attract investment into this sector
  • Structural reforms in the medical practice and education.
  • For senior citizens, Aadhar based Smart Cards containing their health details. A beginning will be made through a pilot in 15 districts during 2017-18.

By all these, the government has proposed 27.7 percent increase in allocation for Ministry of Health and Family Welfare to Rs.47, 352.51 Crore in the latest budget from Rs 37,061.55 Crore in 2016-17, on the current abysmally low base of around 1 percent of GDP. A sizeable chunk of this budget is expected to go towards setting up of two new AIIMS and for conversion of 1.5 lakh health sub centers to Health Wellness Centers. The National Health Mission (NHM) for the entire nation, which the Government earlier said is not working, receives an increase of Rs. 3,000 Crore. According to media reports, the Public Health Foundation of India (PHFI) also considers this budget allocation as a frugal one.

Besides the general expectation for the beginning of a Universal Health Care (UHC) regime in India, pharma industry had generally expected the following immediate term relief, which also found no mention in the budget:

  • Corporate tax cut
  • Extension of time line for weighted deductions of R&D expenditure and adding filing fees and clinical trial expenses under the exemption.
  • Rationalization in excise duty for APIs to bring it on par with formulations.
  • Changes to excise duty due to impending implementation of goods and service tax (GST) Withdrawal of service tax on health insurance
  • Exemption of input service tax on support services

Conclusion:

The reason why I brought ‘Modicare’ in my budget discussion is that it needs well-articulated budgetary allocation, even for just the beginning of its implementation, besides having a robust policy in place. Even on the eve of the 2017-18 Union Budget Session, no less than the President of India had reiterated that his Government assures ‘health care for all’ – further rekindling this hope.

In the absence of a well-charted pathway for public health care in India, no wonder that this budget, in my opinion, demonstrates a clear lack of direction, incoherent and inconsistent, just as the previous ones.

I hasten to add that the Government’s focus on rural infrastructure and development, providing financial benefit to farmers, help building affordable houses, creating new jobs, ensuring ease of doing business, putting more disposable income in the hands of the people are well appreciated. However, none can possibly refute the dictum, especially in the young and highly ambitious India that: “It takes a healthy nation to build a wealthy nation”.

The bottom line, therefore, is, the fastest growing nation of the world continues to feel wise and smart with its lowest expenditure on public health. It also leaves a general impression that the Government has removed from its list of priority all the pledges made on health care, before, during and after having a firm grip on the leash of power. Consequently, this has made ‘Modicare’ no more than a pie in the sky, as it were, for many, even after years of sustenance of an indomitable hope of it coming to fruition.

By: Tapan J. 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.

Would Affordable ‘Modicare’ Remain Just A Pipe Dream In India?

Posted on by
Reply

When ‘Universal Health Care/Coverage (UHC)’, considering a critical socio-economic national responsibility’, has been implemented by the Governments in a large number of countries across the world, why has it still not been effectively addressed by the successive Governments in India, garnering adequate resources, at least, for its phased roll-out in the country?

According to published reports, not just all the developed countries of the world, a good number of developing nations too, including some in Africa, have various kinds of UHC mechanism already in place.

Even within the BRIC countries, India is still a laggard in this area.

Health related major national initiatives of this kind and scale, not only effectively addresses the issue of access to affordable healthcare for all, ensuring high quality of public health environment for a healthy society, but also helps improving economic productivity maintaining a healthy work force.

It goes without saying, UHC helps reducing ‘out of pocket expenses’ towards health, significantly.

OECD Health Statistics 2014: How does India compare?

Total health spending of India with only around 4.0 percent of GDP in 2012 was less than half the OECD average of 9.3 percent.

Public health spending usually tends to rise with the economic growth of a nation. However, despite high GDP growth in the past two decades, India ranks well below the OECD average in terms of per capita health expenditure, with spending of only US$ 157 in 2012 (calculated based on purchasing power parity), compared with an OECD average of US$ 3484.

It is indeed an irony that with highest billionaire wealth concentration, India still tops malnutrition chart in South Asia. (I discussed this subject in my blog post of January 26, 2015.)

Public sector usually becomes the main source of health funding:

In nearly all OECD countries, the public sector is the main source of health funding. However, in India, only 33 percent of health spending was funded by public sources in 2012, a much lower share than the average of 72 percent in OECD countries.

In India, health accounted for only 4.8 percent of total government spending in 2012, significantly lower than the 14.4 percent across OECD countries. Out-of pocket costs accounted for 60 percent of health spending in India in 2012, higher than in any other OECD country.

This trend has not improved much even today.

UHC deserves public funding:

In almost all OECD countries, including many developing nations, as well, UHC remains a key area of public health funding. 

Interestingly, very often UHC is projected as an idealistic social goal that is within reach of only the prosperous countries of the world. This is indeed a myth, as UHC is in place also in countries like, Bangladesh, Sri Lanka and even Rwanda in Africa, besides South-East Asian countries, such as, Japan, South Korea, Taiwan, Thailand, Singapore and China.

The strong relationship between health and economic performance of a country has now been well established globally.

Many case studies covering both the developed and developing nations, clearly point out that a country’s desirable focus on UHC does not just increase the life expectancy of its people, in general, but also facilitates economic growth in a sustainable way, which India is so keenly working towards.

Expectations for UHC received further boost from the new Government:

Just before the Union Budget Proposal 2015-16, in November 2014, national media reported: “ ‘Modicare’ to introduce free medicines, health insurance for citizens”.

It highlighted that in a major health sector reform, the new Government would ensure that every resident in India has access to affordable healthcare with provisions for free essential medicines while bringing over a dozen of diseases, including cancer and heart ailments, under the ambit of the proposed National Health Assurance Mission.

Another pre-budget media report on December 30, 2014, flashed: “The National Health Assurance Mission (NHAM) set to roll, once PM Modi gives go-ahead”.

It articulated, NHAM that has been in the works since 2011 when the erstwhile Planning Commission’s expert group submitted its report on UHC, is likely to take final shape in 2015. PM Narendra Modi is, however, still to see the presentation.

NHP 2015, bolstered hope for early adoption:

On December 31, 2014, when the present Government was in the midst of a series of major policy announcements for the country, The National Health Policy 2015 (Draft) was also released, further bolstering the hope for early adoption of UHC.

I discussed a related issue in my blog post of March 16, 2015 titled, “With Frugal Public Resource Allocation Quo Vadis Healthcare in India?”

Affordable ‘Modicare’ overshadows even ‘Obamacare’?

Universal Health Care (UHC), as narrated in the National Health Policy (NHP) 2015 (NHP 2015 Draft) of Narendra Modi Government, making health a ‘Fundamental Right’ for Indian Citizens, is indeed profound in its both content and intent.

In this article, I would term the new health policy as ‘Modicare’, just as many others did. If implemented in letter and in spirit, as it has been proposed, NHP 2015 has the potential to overshadow even ‘Obamacare’ of the United States…hands down.

A change in the fundamental narrative:

UHC, as detailed in NHP 2015, changes the fundamental narrative of the country’s approach to extend healthcare services to all Indians, irrespective of caste, creed, income level, age or any other pre-determined and conceivable parameters.

However, for this purpose, Modi Government would need to double the public healthcare expenditure from its current level of less than 1 percent to 2.5 of the GDP. It was also indicated that the required fund would be raised by levying healthcare tax to citizens, directly or indirectly.

Government to assume a key role in healthcare:

Currently, private players are playing dominating role with around 70-80 percent share (around US$ 40 Billion) of total healthcare services domain in the country. In other words, public healthcare services cater to no more than 20 percent of the total market, and mostly are of dubious quality standards.

It is interesting to note, NHP 2015 places the Government as the major provider of quality healthcare services for all. However, an individual would have the right to opt for private facilities, of course by paying significantly more.

The business scenario could change dramatically for private sector:

In NHP 2015, the Government becomes the major provider of UHC services. The private sector healthcare players would then probably require going back to the drawing boards to reorganize their business models.

They may well choose to embrace Public Private Partnership (PP) initiatives related to UHC or decide to turn into to niche players in the high-price private healthcare space or something else, as they would deem appropriate. But surely, they would have to take a step or two back from the current dominant role, where there is virtually no competition from the public sector, even in the mass healthcare market.

NHP 2015, underscores the need for affordable drug prices. Thus, the private players could also face tough pricing pressure, as well, while negotiating for large Government procurement.

Both the above issues, when put together and in perspective, would probably not make the private healthcare players terribly enthused or feel at ease. In that scenario, the Government has its task well cut out, mainly for navigating through tough resistance coming from both the national and international lobby groups, in the process of implementation of ‘Modicare’ in India, of course, if it fructifies any time soon or at all.

No control on quality even in private healthcare services:

In India, besides medicines, there is no quality control on any healthcare services, be it public or private.

As public healthcare services are hardly available to a vast majority of Indian population, common people remain virtually at the mercy of pricing diktats of the private healthcare providers, while availing the same. They usually do not have any inkling for high cost of such services, which generally follow the simple ‘demand and supply’ market economy model.

With the implementation of NHP 2015, the Government being the single largest buyer and provider of both healthcare products and services, would presumably negotiate hard both on quality and prices with the respective suppliers, benefitting the patients immensely.

Moreover, since Indian citizens would be paying for healthcare on an ongoing basis through direct and indirect taxes, NHP 2015 proposes free medicines and diagnostics facilities to all, as and when UHC would roll out.

Quietly comes the dampener:

When the Union Budget 2015-16 raised the national allocation for health only by 2 percent over the previous year, it literally extinguished the hope for healthcare reform in India, any time soon, even in a phased manner.

Central budgetary allocation for this initiative is very important, as UHC has been planned to be funded both by the Union and State Governments in 75:25 ratio.

In this intriguing phase, Reuters came out with the ‘Breaking News’.

On March 27, 2015, it reported, though the health ministry developed NHP 2015 on UHC in coordination with the prime minister’s office last year, along with an expert panel, including an expert from the World Bank, Prime Minister Narendra Modi has asked for a drastic cutback of the ambitious healthcare plan after cost estimates came in at US$18.5 billion over five years. Consequently, this would delay a promise on healthcare made in his well-publicized election manifesto, indefinitely.

Prime minister Modi’s manifesto, ahead of 2014 parliamentary election that brought him to power, accorded “high priority” to the health sector and promised a ‘Universal Health Assurance’ plan. The manifesto also said, previous public health schemes that have been mired in payment delays, had failed to meet the growing healthcare needs of the public, the above report highlighted.

Initially, the new Union Health Ministry reportedly proposed rolling out the system from April 2015, and in October 2014 projected its cost as US$25.5 billion over four years.

By the time the project was presented to Modi in January 2015, the costs were already brought down to US$18.5 billion over five years. Even that revised estimate was considered too much and the program was not approved by the Prime Minister, without assigning any timeframe even for a relook.

The delay in ‘Modicare’ is intriguing:

Inordinate delay in the commencement of implementation process of ‘Modicare’ or UHC in India is rather intriguing, primarily due to the following two basic reasons, besides some others:

- NHP 2015 proposes to fund the scheme through indirect and direct taxation on people, who would be covered by this new health policy.

- Experts, such as, Nobel Laureate Dr. Amartya Sen, in scholarly writings, have established with strong evidences, both from the developed and developing nations, that the national focus on UHC goes well beyond just increase in the life expectancy of the population. Besides many other tangible benefits, UHC helps facilitate sustainable economic growth of a nation significantly, which India is now so keenly working on.

Conclusion:

Over the past couple of decades, despite impressive GDP growth of the country, successive Governments in India have not shown desirable inclination to invest in a comprehensive public healthcare project, like UHC.

As a result, the nation still suffers from public health maladies, such as, grossly inadequate number of doctors, nurses, other paramedics, number of hospital beds and other related infrastructure to cater to even the basic healthcare needs of all Indians.

Ironically, at the same time, either the government fails to spend the paltry budgeted amount because of poor governance, or even that small amount faces a year end drastic budgetary cut from the Ministry of Finance to manage the fiscal deficit target of the year, as happened even in 2014-15.

Considering the series of events that followed the announcement of the draft NHP 2015, it appears, the prospects for affordable ‘Modicare’ in India is rather bleak, as it stands today.

There is also a possibility that in the implementation process of ‘Modicare’ the Government may encounter tough resistance from interested lobby groups, purely for business considerations, as deliberated above.

The real reason for delay of ‘Modicare’ has not come from the horse’s mouth, just yet. Nonetheless, it is certainly one of those much hyped and publicized public promises of the Government that remained unfulfilled, at least in the financial year of 2015-16.

Although one should not try to see ghosts where there isn’t any, the moot question that still keeps haunting today: ‘Would much publicized and well sought-after ‘Modicare’ continue to remain just a ‘Pipe Dream’ in India?’

By: Tapan J. 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.