Allocate 3 per cent of GDP to healthcare, says Indian Medical Association

Recommendations for Union Budget 2013-14 include wooing private sector; public health experts sceptical

By Jyotsna Singh
Published: Saturday 16 February 2013

The Indian Medical Association (IMA) has released its recommendations for the health component of the Union Budget 2013-14. Its key demands include increasing budget allocation for healthcare, increasing the tax rebate for preventive health check-ups, and the promotion of public-private partnership (PPP) programmes.

Quoting the report of the National Commission on Macroeconomics and Health, 2005, compiled by the Union Ministry of Health and Family Welfare, Narendra Saini, secretary general of the IMA, says, "The report estimated that public investment for the provisioning of public goods and primary and secondary services will require Rs 74,000 crore, amounting to 3 per cent of gross domestic product (GDP). IMA is hence demanding an increase from the current 0.9 per cent to 3 per cent of GDP.”

The Finance Bill of 2012 included preventive health check-ups in Section 80D of the Income Tax Act. Under this section, a tax rebate of Rs 10,000 is applicable on expenses related to preventive care such as immunization, diagnostic tests and health insurance. This rebate should be increased to Rs 25,000, says Saini.

IMA has further recommended that PPP models be encouraged, and incentives be provided in the form of income tax rebates and supply of medicines and instruments at a lower cost.

Public health experts are, however, sceptical of the recommendations to provide incentives to the private sector. They claim the government earlier provided interested parties with concessions such as lower land rates, in exchange for promises which were eventually left unmet.

Amit Sengupta, co-convenor of Jan Swasthya Abhiyan, a public health advocacy network, is uncertain whether the private sector can be used to harness the long term goal of development of public healthcare. "There is no evidence that providing incentives to the private sector has benefitted the common people. Smaller clinics and individual private practitioners are facing competition from chain-hospitals, but not suffering a lack of incentives," he adds.

Sengupta believes that the IMA's demand is clearly a position tailored to the interests of private practice. "In fact, the need is to greatly increase public financing as well as provisioning. The evidence – domestic as well as global – shows that best efficiencies are achieved when there is public financing and provisioning. The major gaps are in rural and distant areas. Private players won't go there," he says.

IMA's other demands include promoting indigenous medical products and equipment, and allocation of funds towards research and development so as to bring down prices. The IMA also linked healthcare to the mid-day meal scheme and other projects, demanding proper implementation to decrease the disease burden of India.

The report comes a week ahead of the budget session of Parliament which is to begin on February 21.


Subscribe to Daily Newsletter :

Comments are moderated and will be published only after the site moderator’s approval. Please use a genuine email ID and provide your name. Selected comments may also be used in the ‘Letters’ section of the Down To Earth print edition.