Healthcare privatization has not served India well

Context: Our neglect of public health facilities has given private services an outsized role in this sector. A well-funded reversal of this trend would be sensible from a long-term economic perspective

Healthcare privatisation in India

• Began 30 years ago as a part of the liberalisation of the economy.
• Key benefits:
  • ‘Value for money has risen: Especially in areas that have come to be dominated by private.
  • This has resulted in a fair degree of competitive intensity in the healthcare industry.
• Issues in laissez-faire model in healthcare (American model)
  • Education and healthcare demand special oversight by State.
  • Trend of service privatisation cannot be relied upon to give us the base of human capital needed for long-term economic success.

Sorry state of Indian healthcare

• Inadequacies exposed during pandemic: As less than a fifth of all Indians avail of public facilities.
• Vast disparities on health measures as well as access to healthcare: As cited by recent Oxfam Inequality Report 2021.
• Inherent trend: Rich are healthier than the poor, just as a general category is better off than Scheduled Castes and Tribes, Hindus are better off than Muslims, urban-dwellers better off than rural, and men better off than women.
• Urban bias:   Over two-thirds of our health infrastructure concentrated in towns and cities, serving just about a third of our population.
• Social divide – Gender perspective: There is a socially-observed reluctance among chief household decision-makers to seek medical attention for women.
• Inadequacy of care for women is reflected in our dismal numbers on maternal mortality and female life expectancy at birth and scandalous gender attitudes revealed by starkly uneven sex ratio.

Way forward: Shift towards European-style state delivery model - 

• Increase public funding: To achieve universal health coverage by 2030, Indian government has accepted a recommendation of 15th Finance Commission to roughly double public funding on healthcare to 2.5% of GDP by 2025.
• Policy recalibration: Centre to lay out a cohesive plan that shifts emphasis from an insurance cover to actual service delivery.