A weak and overcrowded public health system has led to the burgeoning private healthcare business across the country. But many of these hospitals are poorly regulated and expensive.
The Fortis hospital in Gurugram recently handed the family of a dead seven-year-old dengue patient an exorbitant bill for almost Rs 16 lakh after a fortnight of care. The bill allegedly included the costs for about 1,600 surgical gloves. Health minister J.P. Nadda has sought details of the case for the government to investigate.
Does the Fortis tragedy show that private healthcare is unaffordable even for the middle class?
India’s situation is peculiar, given that we have a very large private healthcare system without an insurance mechanism. Because there is very little penetration of health insurance, there is very little supervision and control.
The public healthcare system is regulated by the government with all its regulatory inefficiencies and faultlines. How do we then ensure accountability in private healthcare? What would have worked is an independent insurance sector as a third party, which would monitor healthcare quality and cost. We do have a new clinical standards Act, but it lacks teeth. Therefore, we cannot pin responsibility on the wrongdoers, and there is no other credible and strong regulatory mechanism.
The second aspect is that of cost. For every other commodity, it is economics 101— when prices go up, supply goes up as well to meet the demand. But in services like health, even if prices go up, this doesn’t happen. This is because of entry restrictions in the health sector. The two sectors that are most difficult to get into are health and education.
Here are other sharp perspectives on the issue of whether even the middle-class cannot afford privatised healthcare:
Keshav Desiraju: former health secretary
K K Aggarwal: national president IMA and Heart Care Foundation of India
Mira Shiva: public health activist
This is why India has a particularly low doctor-to-patient ratio.
This creates a massive supply gap. Therefore, prices will be high. Moreover, health is a commodity that the consumer knows nothing about. The information gap between patient and the health provider is huge. The patients have no option but to take the doctor at his/her word. And because it is a matter of life and death, you inevitably pay. Again, the need for a third-party regulator becomes paramount.
What we need is not just one solution. For starters, we need a far stronger public health system. Along with that, we also need a strong private healthcare system. Only the public sector can’t provide for a country as highly populated as India. We spend less than one per cent of our GDP on public healthcare, this must increase to around three per cent. There is also a need for a strong public-private partnership. They should work together.
All these reforms must happen together. It was a welcome move that the new health policy talked about such reforms.
What is remarkable that such calamities don’t happen too often.
Amir Ullah Khan is a professor of economics at the Maulana Azad National Urdu University, visiting faculty at ISB, and teaches health economics at Manipal University