Alleviating the scourge of private healthcare

India ranks poorly on multiple health financing indicators, evident from its public health expenditure as a percentage of its GDP (1.28%). In India, private healthcare needs to be made affordable alongside expanding public healthcare.

Scenario of the Healthcare Sector in India

• Healthcare industry comprises hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical tourism, health insurance and medical equipment.
• India’s healthcare delivery system is categorized into two major components - public and private.
  • The government (public healthcare system), comprises limited secondary and tertiary care institutions in key cities and focuses on providing basic healthcare facilities in the form of Primary Healthcare Centres (PHCs) in rural areas.
  • The private sector provides a majority of secondary, tertiary, and quaternary care institutions with major concentration in metros, tier-I and tier-II cities.

Private sector in healthcare:

• Contribution: Private spending constitutes nearly 60% of overall expenditure on health.
• Dispersed Sector: The private sector in India is dispersed and its characteristics such as:
  • Marked inequities between rural and urban areas
  • widespread market failure
• The income disparities, backwardness, and under-regulation incentivizes the private sector to differentiate into a host of organizations, each serving its own customer base.

Why is private healthcare not affordable in India?

• Dispersed sector or greatly fragmented
• Great disparities between urban and rural areas
• Quality private healthcare is generally limited to high-cost urban areas
• Insurance with unreasonable package

Challenges with the Health Sector

• Inadequate Access: Inadequate access to basic healthcare services such as shortage of medical professionals, a lack of quality assurance, insufficient health spending, and, most significantly, insufficient research funding.
• Low Budget: India’s public expenditure on healthcare is only 2.1% of GDP in 2021-22 while Japan, Canada and France spend about 10% of their GDP on public healthcare.
  • Even neighbouring countries like Bangladesh and Pakistan have over 3% of their GDP going towards the public healthcare system.
• Lack of Preventive Care: Preventive care is undervalued in India, despite the fact that it has been shown to be quite beneficial in alleviating a variety of difficulties for patients in terms of unhappiness and financial losses.
• Lack of Medical Research: In India, R&D and cutting-edge technology-led new projects receive little attention.

• Policymaking: Policymaking is undoubtedly crucial in providing effective and efficient healthcare services. In India, the issue is one of supply rather than demand, and policymaking can help.
• Shortage in Professionals: In India, there is a shortage of doctors, nurses, and other healthcare professionals.
  • According to a study presented in Parliament by a minister, India is short 600,000 doctors.
• Paucity of Resources: Doctors work in extreme conditions ranging from overcrowded out-patient departments, inadequate staff, medicines and infrastructure.