Budget 2013-14: provisioning for universal healthcare or moving away from agenda?

The world trend is to move towards public health systems, but developments in India seem to be in the opposite direction

By Sona Mitra
Last Updated: Saturday 04 July 2015

The government of India is yet to recognise and institutionalise the right to health as a universal right of every citizen. India’s public spending on health, at about one per cent of the country’s GDP, has been among the lowest in the world. On the other hand, with a high burden of out-of-pocket spending on health, millions of people are reportedly being pushed below the poverty line every year. As a result, provisioning for healthcare has emerged as the most critical public policy challenge confronting India at the present juncture.  In this context, the present article focuses on the 12th Five Year Plan’s proposals for the health sector for the next five years, which are expected to influence the allocations for health in the forthcoming Union Budget 2013-14.

The 12th Five Year Plan document promises a lot of deliverables in the health sector over the next five years. It envisages a National Health Mission, moving the National Rural Health Mission (NRHM) into the urban sphere, and launching of an all-inclusive health mission that would work towards achieving universal healthcare in the country. In a welcome initiative, the plan document proposes to increase India’s overall public spending on health (combined spending on health by the Centre and all states) to 2.5 per cent of GDP (including budgetary allocations made towards Water and Sanitation, Integrated Child Development Services and Mid-Day Meal scheme) by the end of the 12th Plan period. The 12th Plan proposes an allocation of Rs 2,68,551 crore for the next five years, which is a significant increase from the total Plan expenditure on health over the 11th Plan period. It rightly recognises the need to reduce out-of-pocket expenditure of households on health and step up the share of public spending on health to almost 70 per cent of total health spending (government spending and out-of-pocket spending) from a current share of roughly 30 per cent.

The Plan document also highlights the importance of enhancing availability of drugs within the public healthcare sector, for which the Plan proposes to set up 3,000 more Jan Aushadhi Stores  in rural areas across the country, during the five-year period, where medicines would be provided free of cost. With regard to this specific proposal, there exists a growing expectation from the Union Budget 2013-14 that it would make a separate allocation of up to Rs 30,000 crore for financing the provisioning of 348 major generic drugs free of cost within the country as a step towards universalising access to medicines in rural areas.

Enter PPP

However, the roadmap for financing of the proposed allocations for health over the next five years is where the dichotomy of the Plan surfaces. While suggesting certain initiatives like introducing “sin tax” on harmful items like alcohol and tobacco for financing the health sector, the Plan proposes general tax revenues as the principal source of finance for public health, to be supplemented by partnerships with the private sector and contribution of corporate sector as part of corporate social responsibility. The Plan proposes to increase public expenditure on health by 34 per cent annually for the next five years and also proposes to keep the share of Centre-state expenditure at the existing 30:70 ratio.

We may note here that in 2004-05, the United Progressive Alliance government at the Centre had acknowledged in its charter of governance, the National Common Minimum Programme (NCMP), that it needed to increase the country’s total public spending on health to the level of 2-3 per cent of GDP by the end of its tenure—financial  year 2008-09. Now, a similar target (or rather, a more diluted version) has been set for stepping up the country’s public spending on health for financial year 2016-17. This only implies that the government is not very keen to acknowledge the implications of the acute shortage of financial resources for health sector, which have persisted over the last decade.

As regards the proposed division of financing responsibility between the Centre and the states, given the growing dominance of the Centre in the domain of public resource mobilisation in the country (in collection of tax revenue), the inability of several backward states to step up their own mobilisation of revenue, and the shrinking share of untied transfers to states within the total transfers from the Centre, it was necessary for the Planning Commission to ask the Centre to shoulder a bigger share of the financing responsibility in the next Plan period instead of continuing with the same 30  per cent share in overall public spending on health. In fact, unless the 14th Finance Commission suggests some radical changes in the domain of Centre-state sharing of resources (which seem unlikely from the terms of reference given to this Finance Commission), the 12th Plan period might not witness significant increase in states’ spending on health, which in turn would imply that the country’s overall public spending on health would continue to be much lower than the required levels.

Instead of ensuring adequacy of financial resources for provisioning essential health care to all, there seems to be a wishful thinking on part of the Planning Commission to expect large contribution from the private sector for creating universal access to health care. This, in fact, comes across as the growing unwillingness of the government to provide for a healthy existence for the poor and vulnerable sections of the population. It also reflects the willingness of the Planning Commission to usher in private operators as partners within the public sector health care system.

No roadmap for achieving development goals 

This is where the dichotomy of the Plan document gets reflected. While the Planning Commission on the one hand recognises the increased burden on the households due to an increase in the share of private service providers within the health sector and highlights the demerits of such services, it moves ahead with a roadmap of providing the private operators with a public infrastructure without any robust system of regulations and monitoring mechanisms. Experts have correctly pointed out that with such an approach the government ends up subsidising the private sector instead of the people.

Taking into account the international experience, in countries with universal access to health care like those in Europe or Latin America, the systems have been achieved through government. In Asia, universal healthcare in Sri Lanka and Thailand has also been achieved by active participation of the government.  While the world trend is to move towards public health systems, the developments in India seem to be in the opposite direction.

Despite accepting or acknowledging that the country faces an acute shortage of skilled human resources (to the extent of at least 6.4 million skilled people), the country is still far from fulfilling the Millennium Development Goals (MDGs) in health (in terms of reducing infant and maternal mortality rates and improving child sex ratio, TFR and malnutrition among children). Studies have shown increased poverty levels among rural population due to high expenditure on health, and an acute need to increase per capita public spending on health. But the Plan document fails to provide a solid roadmap for generating adequate financial resources and depends on the private sector for additional resources. The approach of the plan document, if analysed closely, therefore, raises doubts on whether we are moving towards universalisation of healthcare or moving away from it.

The author works with Centre for Budget and Governance Accountability (CBGA) and can be reached at sona@cbgaindia.org


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  • Health sector reforms which

    Health sector reforms which India needs
    - hopes of a Public health professional from
    As now are the budgetary days in India, lots
    of talks are there on the issues of
    strengthening public health and education
    system. Some media reports are there about
    the possible Health System Reforms and
    Universal heath cover in India but we will
    only know how our worthy planners and
    ministers have planned to take care of our
    health in the next year on the Budget day, I
    am writing with a perspective to review the
    direction of government in health sector in
    recent past, to bring in notice some recent
    developments in the world in terms of
    economical public health delivery system,
    recent trends in development of policies in
    health sector, priority problems and some
    possible suggestions for practical
    implementation of those up to grass root
    level of healthcare provision in India.
    Multiple issues and aspects have been
    touched in the article fulfilling the need of
    the subject, however, each aspect requires
    further detailed elaboration.
    There is urgent need to address following
    lacking areas in health care provision and
    improvement in general health of Indians -
    1) Because of global economic slowdown it
    will be difficult for India to continuously
    raise the health budget to meet the growing
    demands of Health care provision for
    chronic illnesses. Even country like U.S. is
    thinking of strategies and methods to
    provide best possible Health services at
    minimum possible resources. On 28th June
    2012, the U.S. Supreme Court uphold the
    Affordable Care Act, which is the most
    important legislation since the Civil Rights
    Act. Under this health care law, many
    insurers are required to cover certain
    preventive services at no cost to public1.
    Today, human suffering and the cost to U.S.
    society is measured by national trends in
    population health. The U.S. expends over
    17% of the gross domestic product on health
    services; yet, ranks approximately 30th in
    health outcomes compared to other
    countries. This 17 % of U.S. GDP will amount
    to 30 times the IndiaÔÇÖs Health budget. But
    still they are looking for innovations to
    improve health and health care at reduced
    cost. They are studying what is driving the
    rise in costs, what is waste, and how billions
    of dollars can be saved. The most exciting
    opportunity provided is for every public
    health professional to participate in positive
    change. India however, still struggling to
    provide universal basic healthcare has its
    own problems of wasteful expenditure e.g.
    wilful postings of doctors at lucrative sites
    on long deputations, non availability of
    simple and easily available instruments
    halting work all due to lack of accountability,
    mismatched staff there are cases where
    surgeons are working as program officers at
    District level while hospitals lack surgeons. Is
    it not more important to curb wasteful
    expenditure for us when we are not able to
    provide basic health care? Possible solution
    will be target based focused attention on
    different levels of health care provision in
    every state in collaboration with a central
    advisory committee using NRHM funds.
    Better will be going higher to lower levels,
    first strengthening of tertiary level hospitals
    for country like India.
    2) The second major problem in health care
    provision as per Govt. is lack of health care
    providers, out of which serious concern is
    shortage of doctors in public health system
    in rural areas and has been a major concern
    for the last two Union Health ministers
    which has led them to create a brand new
    medical study course for rural medical
    science B.Sc.(community health), the final
    shape of which we are unaware of till now.
    But here rises a big question, that do we
    really so badly require thousands of new
    health care providers when we are not using
    the existing manpower to its full potential?
    This should be our first priority. As a part of
    the health care delivery system we have
    observed that although we talk about
    overburden on Govt. hospitals but it is only
    at the level of large tertiary care hospitals
    and few District level hospitals while
    majority of the block level community health
    centres (CHC) and primary health centres
    (PHC) where doctors are available remain
    non functional due to lack of interest of
    doctor itself, lack of monitoring/ false
    reporting and if doctor is willing to do
    justice to his work gets limited by lack of
    supporting staff, laboratory facilities,
    medicines or pathetic atmosphere of
    workplace thanks to ego clashes among
    doctors. The Patient which can be easily
    managed at these centres now move to
    higher centre leading on to overburden
    there and again limiting the quality of health
    care. Is it not more important to first focus
    on these issues and making these units
    functional up to their maximum potential?
    Possible solution which can be applied is to
    identify the manpower lying vacant or
    underutilised and utilising them in more
    productive way. In management terms it is
    called Resource levelling, but it requires
    management and planning with authorative
    powers at district levels and even lower. It is
    worth to mention that in India , civil
    surgeons/ CMOs who are responsible for
    such work are not able to perform as par
    with the other district authorities e.g. IAS .
    Reasons might be various, but worth
    mentioning is that lack of support from
    ministers and beurocrats if someone tries to
    do so.
    Country has infrastructure and capacity in
    approximately 335 medical colleges (about
    half are government medical colleges and
    rest are private), which produce around
    40,000 medical graduates annually. After
    getting education, very few of them join
    health services due to uncertain career
    prospects and lack of proper facilities and
    emoluments. It is a matter of great concern
    that young doctors are reluctant to join
    government job and prefer to work in urban
    settings that too in private setup. It is
    difficult to say whether our teaching
    standards are successfully addressing
    societal needs and expectations by
    preparing students with knowledge and skills
    in disease prevention and health
    The problem which is more severe is lack of
    specialists, but still there are various places
    where specialists are serving as District
    program officers rather than providing
    treatment care of the concerned speciality, is
    it not mismanagement of human resource?
    3) No system exists for purposeful
    community focused public information or
    seasonal alerts or advisories or community
    health information to be circulated among
    doctors in both private practice and in
    public sector. PHCs were meant to be local
    epidemiological information centers which
    could develop simple community. Civil
    Surgeons and panels have no active role in
    pre planning and preventive advisory until
    the epidemic has already occurred. Majority
    of Medical Officers canÔÇÖt even count the
    various national health programs running in
    their own districts. No estimates are being
    provided to them regarding disease burden
    in their area of PHC. To tackle this issue the
    Indian Public Health Standards(IPHS) report
    suggest recruitment of Public Health
    Program Manager at every CHC level2 which
    has not been implemented. It carries a lot of
    advantage of carrying planning activities
    from district level to block level.?
    How can a newly recruited Medical officer
    will perform until he be made aware of local
    situations and modalities of work in his
    area ? but who will do so is unclear because
    District Program officers are given charge of
    some specific programs and no one is there
    to provide holistic situation. Induction
    training at many states is being provided
    after 6 months !! The need is to enhance
    micro planning, setting responsibilities and
    liabilities, proper monitoring , sorting out
    local issues, charting realistic targets,
    empowering district administrators for
    manpower management.
    4) The separation of public health, research
    and education, and medical health services
    when done was basically intended to spur
    advancement in health science and practice;
    but it has cause stagnation of information
    due to lack of inter-linkage between state
    health departments and medical colleges.
    The challenges we face today in the 21st
    century are to strengthen the
    interconnection, not the separation, of our
    institutions that link evidence with practice,
    practice with public health, and the training
    of health scientists with health professionals.
    It is duty of health scientists and
    professionals to bring better health and
    better health care to society. But all these
    measures need continuous support by policy
    makers. There is a need to communicate
    more among persons in a health related
    leadership role, whether a scientist,
    practitioner, legislator, academic, or health
    industry businessman. All have a
    responsibility to seek accurate information
    about why we need health care reforms. If
    we are in a health related profession, then
    we are responsible for the health of our
    children and adults.
    There are many fields in medical profession:
    as mentioned, researchers, public health
    physicians, general physicians, surgeons,
    medical practitioners, geneticist, pathologist,
    teacher for basic medical sciences. However
    who are confronted with patients directly
    need to be addressed properly by
    formulating laws. Possible solution which
    can be suggested for this problem is to
    regenerate a link between medical colleges
    and research centres and state health
    services via Department of community
    medicine, it will also solve the problem of
    students lacking in hand on experience of
    health services jobs. Presently it is limited to
    some of the programs which varies state to
    6) Defunct Public health care delivery system
    - as every body knows the enjoyment of
    highest standard of health is a fundamental
    right of every human being. The Indian
    healthcare industry is witnessing growth at a
    rapid pace and it is expected that the sector
    will touch US$238.76 billion by 2020 with
    annual growth of 14% 4. But this growth
    basically represents growth in private
    healthcare sector and Pharma industry. All of
    80 per cent of healthcare is now privatised
    and caters to a minuscule, privileged section.
    The metros are better off: they have at least
    a few excellent public health facilities,
    crowded though they might be. Tier II and
    III towns mostly have no public healthcare to
    speak of. Millions of Indians living in small
    towns go through the same agony--not
    knowing where to turn to in the absence of a
    good health system. Because of that,
    thousands travel to DelhiÔÇÖs overburdened
    AIIMS and Safdarjung Hospital, which are
    staffed with excellent doctors. The rest just
    pay for a private system designed to extract
    the maximum from each patient. ÔÇ£Public
    health is a big question in small cities. They
    have government hospitals, which are not
    well-equippedÔÇöin terms of infrastructure or
    adequate numbers of doctors and other
    staff. Why canÔÇÖt Public Health care provision
    sector can not join and grow along with this
    growing sector?
    ÔÇ£A healthy nation needs healthy people. We
    all agree that our citizens must be literate.
    Perhaps it's time to ensure that all of those
    literate remain healthy and functional as
    well. We can do better.ÔÇØ
    The possible reason easy to understand
    which is of utmost importance is that it is
    not possible to accomplish the motive of
    health for all by funding Healthcare as
    subsidy. How long the health care delivery
    system will run as a subsidy? Indian
    economy will not be able to bear expenses
    of quality healthcare to all citizens. Should
    we not make the larger public sector
    hospitals self reliant by allowing their
    management to run parallel health facilities
    comparable to private sector ones at some
    decent charges along with the already
    existing hospitals ? When people are able to
    pay and have belief in larger institutes like
    AIIMS but only go to private sector because
    of difficulties due to overload and rush.
    Provision of such a system will create a
    situation of competition which will check the
    highly exaggerated cost in corporate
    In the health sector, the buzz these days is
    all about Universal Health Care (UHC). While
    health activists see in it potential to ensure
    access to quality health care for common
    citizens, commercial bodies seem to be
    eyeing the huge scope for profit from
    sickness, in a field already characterised by
    large scale commercialisation and imbalance
    of information between providers and
    users.5 Indian Govt. is planning for the
    Universal Health Coverage with a central and
    state expenditure of 85:15 respectively, but
    it will be hurried step to jump into this
    before judging the benefits of similar
    schemes like RSBY(Rashtriya Suraksha Bima
    Yojna). There will be much bigger problem
    of money leak and corruption without hawk
    eye supervision mechanism for public
    private partnership. We should learn from
    countries like USA where this system is well
    developed, but they still believe that it
    cannot be made possible until you have a
    well developed mechanism of preventive
    health care services, disease surveillance
    system and health promotive programs.
    Otherwise it might be a disaster for a
    nations economy.
    LetÔÇÖs think carefully about what we actually
    do as physicians, and as we do this consider
    the words we are using. Most ÔÇ£health careÔÇØ
    providers are not dealing in ÔÇ£healthÔÇØÔÇô they
    are in the business of ÔÇ£rescue and
    repairÔÇØmedicine. On the whole, results are
    good (sometimes spectacular) ÔÇô but the
    benefits are not available fairly across
    society. We should take first step in the
    process of organizing a true system with
    equitable access to quality, affordable
    ÔÇ£rescue and repairÔÇØ services( insurance
    cover).ÔÇ£The end of the beginning, not (even)
    the beginning of the end 
    But even then the deeper problems will
    remain. The development of new and better
    treatments and medical technologies is
    never-ending ÔÇô and of course this should be
    encouraged and welcomed ÔÇô but ÔÇ£rescue
    and repairÔÇØ services will always struggle to
    keep up and costs will continue to climb. We
    will never get ahead of this curve unless we
    start to reduce the incidence of the major
    chronic diseases and conditions, by
    embracing health promotion and disease
    prevention. We havenÔÇÖt even scratched the
    surface yet ÔÇô but if we donÔÇÖt start doing so
    soon, the country is going to be bankrupted
    by ÔÇ£health careÔÇØ costs. The cost of prevention
    per person is far less than the cost of the
    variety of cures, from surgical to
    pharmacological. The health of the
    population has gone beyond the health
    sector and involves the development sector
    in the recent past, reiterating the principle of
    multisectoral approach in PHC. The
    physiological risk factors can be delayed if
    the behavioural risk factors are given due
    emphasis at an early stage.6
    Should we not encourage involvement of
    Health professionals and management
    people in policy making rather only
    depending upon Administrative people
    learning from our failures in various
    Although these issues require more debate
    and separate discussion.
    Some of the solutions emerging are as
    1. The States must appoint Public Health
    Manager at CHC level as per IPHS 2007
    preferably MD community medicine/ Social
    and Preventive Medicine decreasing the
    workload on the part of civil surgeons/CMOs.
    2. State Health Departments should
    collaborate and involve Medical colleges in
    development of local strategies and
    concerned speciality of medical college
    should be associated in local action plan of
    any national program, rather than both
    planning separately. This plan should be
    then further be micro-planned by Public
    health managers at block level along with
    District Program Officers. Should be
    monitored with appropriate tools like
    realistic target achievements, setting up
    3. These Public Health Program Managers
    should provide purposeful community
    focused public information / seasonal alerts/
    advisories/ community health information
    which should be circulated among doctors
    in both private practice and in public sector.
    Importance should be understood as now
    we are facing Swine flu.
    4. Necessary focus on adding practical
    education to medical students on prevention
    of non communicable diseases. Initiation of
    Preventive Medicine clinics at medical
    colleges by Dept. of Social and Preventive
    Medicine to identify and timely manage
    chronic diseases in families of diagnosed
    patients, providing Primary, secondary and
    tertiary level of Preventive care and various
    other roles without much new investment.
    5. There is a need for flexibility in fixing
    compensation for health personnel in order
    to make the government services more
    attractive. Further promotions should be
    linked to training and attainment of higher
    knowledge and skills relevant to service
    delivery. Why only a single rank of MO for
    around 16-20 years before promotion to
    6. The state health directorate should have a
    full fledged HR department with specialized
    staff and dedicated budget. The states
    should develop short and long term human
    resource strategies and plan by adopting the
    standard process of manpower planning.
    7. The existing recruitment rules should be
    reviewed and modified in the light of
    changing job requirements and improvement
    in overall education level. Recruitment of
    programme staff should be undertaken with
    a view at long term utilization. District level
    recruitment in NRHM is presently having a
    lacuna to retain trained staff.
    8. The state governments should devise
    policy for providing better housing and
    education facility for children of Doctors to
    make rural posting more attractive. Financial
    incentives only will not work. Why not their
    children can be provided education in Army
    schools? Terms and Conditions like nonÔÇô
    allotment of home district should be waved
    9. The state government should consider
    time bound promotion and transfer and
    deputation policy for all categories of staff.
    Why not make it more transparent by setting
    detailed guidelines rather than lending
    decisions in hands of few officials? Better
    working environment will attract honest and
    hard working doctors.
    10. The state should undertake proper
    training of supervisory staff and effective
    monitoring of supervisory activities in order
    to strengthen supervision.
    11. The states need to adopt a
    comprehensive training policy based on the
    actual needs as per the job requirement.
    12. Make the larger public sector hospitals
    self reliant by allowing their management to
    run parallel health facilities comparable to
    private sector ones at some decent charges
    along with the already existing hospitals.
    Large Public sector hospitals should be
    allowed to initiate separate hospitals for
    Health tourism, NRIs and Upper middle class
    nationals , funds generated from these will
    help research activities at those centres and
    can also make some hospitals self reliant.
    13. These hospitals will be a tough
    competitor for corporate hospitals and will
    bring down the highly exaggerated cost.
    14. District Hospitals and tertiary hospitals
    need more of the managerial posts , having
    fresh minds and newer ideas under the
    supervision of Senior doctors/ SMO.
    If we truly wish to avoid bankrupting the
    country with healthcare costs we must
    emphasize prevention, specifically teaching
    It requires a major shift in the way
    healthcare practitioners and other providers
    approach the need to better educate our
    population about maintaining individual
    health. Over the past century the disease
    model has become predominant and the
    wellness model has come to be perceived as
    a fringe approach, poorly understood and
    There are many reasons why the current
    model emerged and holds such a strong
    position. It has been easy to comment on
    the difficulties in educating the population
    but we have the methodology, educational
    and psychological research, teaching
    resources, and technology needed to do the
    job if we would "wake up and smell the
    coffee". It will require healthcare providers
    to assess the knowledge and comprehension
    of each client. The topic areas will need to
    be prioritized to ensure that the greatest
    threats to each individual's ability to remain
    well are addressed. Initially it may seem as if
    the cost of an office visit would increase. The
    long term result would be savings for the
    individual who would spend less as chronic
    illnesses were avoided or significantly
    reduced in severity. A gradual but significant
    improvement in the quality of life is the
    expected as an outcome if chronic illnesses
    can be reduced and limited in severity.

    Posted by: Anonymous | 7 years ago | Reply
  • Dr Singh's comment is

    Dr Singh's comment is extremely important , enlightened and deserves consideration.

    Posted by: Anonymous | 6 years ago | Reply