Universal healthcare: How Narendra Modi can score a big win over UPA

If media reports are to be believed, the Modi government is likely to deliver on the long pending promise of universal healthcare that his predecessor Manmohan Singh shamelessly defaulted on.

The Business Standard on Wednesday reported that the the NDA government’s budget will focus on a national health assurance mission, which will provide universal healthcare and comprehensive health insurance for the poor. The report further said that the national health assurance mission is “close to Prime Minister Modi’s heart".

Representational image. Reuters

Representational image. Reuters

Manmohan Singh had promised that the country’s 12th Plan would be a “health and education plan”, which meant that health and education would drive the development agenda of his government and the next plan period. He also had promised that his government’s health spending would rise from 0.9 percent of the GDP to 2.5 percent. But what was really on offer finally was not a universal health plan or a tripling of the health spend, but a proposed allocation of just 1.5 percent of the GDP. That too despite very strong recommendations of a High Level Expert Group (HLEG) of the 12th Plan.

The contours of the Modi government’s plan are not clear, but the title “health assurance” is promising because that is precisely what the HLEG had recommended -- a cashless, universal scheme in which any Indian citizen can walk into a hospital without being worried about the expenses.

Universal health assurance is unavoidable in a country like India where 75 per cent of the healthcare expenses are borne by people. These out of pocket (OOP) expenses can be catastrophic if their conditions are serious, which will in turn push them into irreversible impoverishment. As the economic crises of east Asian countries in the late 1990s showed, periods of poor economic growth demand more investment in social and health sectors.

Catastrophic OOP expenses have been on the rise and are a major cause of impoverishment of the lower and middle-income household as an analysis by Soumitra Ghosh (19 November 2011) in Economic and Political Weekly implies. “The lower- and middle- income households bear the brunt of the ongoing healthcare reforms,” the article said. “The evidence points towards higher incidences of impoverishment among these populations. Therefore, a rather broad-based risk pooling and prepayment measure (balancing between sick and healthy) would seem to be a better financing strategy as it would limit OOP spending, increase financial protection, reduce the risk of impoverishment and ensure the utilisation of healthcare services by the poorest of the poor. Social health protection mechanisms may be more suitable for a country like India with a dominant informal sector.”

However, what’s worrying is the idea of a “comprehensive health insurance”. While the assurance is certainly reassuring, insurance is fraught with dangers. In an earlier interview with Firstpost, Dr Srinath Reddy, Chairman of the HLEG, had said that in his group’s proposed UHC plan, “the State should be the main provider of healthcare, but could involve others such as the private sector and NGOs. We had proposed two options, one of which in fact rules out private insurance coverage. The insurance schemes are the ATMs for private hospitals.”

The recommendations of the HLEG should form the cornerstone of the new government’s plan.

They addressed sources of financing; strengthening health systems - mainly subcenters, primary health care and facilities at the districts - so that bulk of the burden could be addressed locally; capacity building of healthcare workforce; healthcare infrastructure; standards for care, regulation and management; drug procurement and distribution; grievance systems and so on.

The HLEG also asked the government to simultaneously address the social determinants of health, which meant addressing the mutually aggravating fundamental inequalities that kept most Indians desperately poor and sick.

Here are seven critical points that Dr Srinath Reddy delineated in an earlier interview with Firstpost. They might be useful to the finance and health ministries.

Your thoughts on UHC and the HLEG-recommendations, given the widespread apprehensions of the Planning Commission not implementing them in full.

Cashless, universal healthcare should be the model we should move towards and the vision of the UHC should be included in the Plan document. UHC should be the comprehensive framework for the country’s public health planning and we have to take it forward sequentially.

Policy makers will respond to well-articulated public demands and hence there should be public debates on the issue. The states can in fact become the champions of UHC.

One of the reasons cited for the Planning Commission going slow on UHC is financial constraints - the slowdown of the economy and squeeze on resources

An economic slowdown in fact demands more investment in the social sector. During the financial crisis of the 1990s, East Asian countries, who were badly affected, continued to invest in health and education. In fact, besides protecting people from economic shocks, it can also contribute to growth and employment. We should learn from their experience. Investing in health will also create a lot of jobs.

There is a lot apprehension on privatisation of healthcare, in the guise of efficiency and capacity constraints, through public private partnerships (PPP).

To me, PPP is partnership for public purpose and not partnership for private profit. We have to first define public purpose and its pathways. Public sector should set the terms. It should lead to socialisation of the private sector.

In the context of UHC, there is this tendency of outsourcing healthcare to insurance companies. States such as Tamil Nadu now have a system of insurance companies, paid for by the government, providing services.

What we proposed is health assurance than health insurance. According to our UHC plan, the State should be the main provider of healthcare, but could involve others such as the private sector and NGOs. We had proposed two options, one of which in fact rules out private insurance coverage. The insurance schemes are the ATMs for private hospitals.

We are living in a mixed health system. If we do not strengthen the public health systems, by default the private sector will expand its presence.

Some strongly argue against tertiary healthcare under UHC because it might eat up all the money.

Some elements of tertiary healthcare are required for even maintaining primary and secondary healthcare. For instance, It’s inconceivable that snake-bite victims cannot be given ventilator support if needed.

There is this routine argument that the country’s health systems do not have the appropriate “absorption capacity” for large amounts of money. In fact, it is pointed out that the health ministry could not fully spend the allocation for the last Plan period. Such situations favour the advocates for PPP and privatisation.

We have to rapidly strengthen capacity and put in the money - absorption capacity will improve. The UHC roadmap gives a lot of emphasis on strengthening primary health care and district level capacity. Financial protection (allocation of funds) alone is not enough; there should be adequate infrastructure, trained healthcare workforce, essential drugs, and community-involvement

There are many centrally funded vertical health schemes that seem to fragment the public health sector in India. Wouldn’t there be a conflict between them and the UHC?

They should be transitioned into the UHC. UHC should be the comprehensive framework. Otherwise, it will further fragment the scene.

Updated Date: Jun 26, 2014 14:35 PM

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