Every year, around 55 million Indians are pushed into poverty due to catastrophic healthcare expenditures. And this is only one of the symptoms of a broken system that is also entrenched in ethical issues over inappropriate treatment in private facilities, overcrowded and underfunded public facilities and deteriorating work conditions.
by Susana Barria
In the last issue of Right to Health, we published a critique of the Indian Governments proposed 'Modicare' health insurance scheme, raising concerns about its adequacy in resolving the issues people in India face in accessing healthcare. Every year, around 55 million Indians are pushed into poverty due to catastrophic healthcare expenditures. And this is only one of the symptoms of a broken system that is also entrenched in ethical issues over inappropriate treatment in private facilities, overcrowded and underfunded public facilities and deteriorating work conditions.
As India prepares federal elections in May 2019, the current government presented its last budget in January. What emerges from the Interim Budget 2019-2020 is the consolidation of two trends – allowing public health services to collapse, while strengthening the role of the private sector through one of the world’s largest public–private partnerships in healthcare.
The Interim Budget is biased against strengthening public health services
In the budget, government systematically neglected components that are essential to strengthening public healthcare. For instance, capital expenditure used to build infrastructure and procure equipment has been reduced by 43% in the interim budget 2019–20 over the actual expenditure in 2017–18. Resources towards establishing new medical colleges and upgrading district hospitals have declined by nearly 40% over the expenditure in 2017–18. Schemes to strengthen district hospitals and medical colleges with more human resources face reduction in real terms too. As for the frontline workers, the budget speech offers a risible increase in the honorarium of community health workers (known as accredited social health activists or ASHAs) from the current INR 2,000 per month to INR 3,000 (US$ 28 to 42), which is far less than the long-standing demand for a monthly wage of INR 18,000 (US$ 253) (JSA Statement).
The National Health Mission (NHM) launched in 2005 had increased budgetary allocation to public primary care facilities especially in rural areas. It is under this programme that the network of Primary Healthcare Centres (PHCs) was strengthened. This led to an improvement of health outcomes by bringing people back to public sector facilities in rural India. However, the budget allocation for NHM is lower than the expenditure of the previous year. The share of NHM in the total allocation on health has gone down from 61% in 2014–15 to 49% in the 2019–20 budget.
Yet, the overall health budget has seen an increase, more than half of which is dedicated to a single scheme, the insurance component of the Ayushman Bharat Scheme. The Ministry of Health and Family Welfare (MOHFW) has received an allocation of INR 633 billion (US$ 8.8 billion), an increase of INR 70 billion compared to the previous year. INR 64 billion is devoted to the Pradhan Mantri Jan Aarogya Yojana (PMJAY), with an impressive 167% increase over the previous year.
What is the Ayushman Bharat Scheme?
The Ayushman Bharat Scheme is a national health initiative that was announced in early 2018, with two components. The National Health Protection Mission or Pradhan Mantri Jan Aarogya Yojana (PMJAY) is the insurance scheme for hospitalisation in empanelled private or public hospitals. PMJAY is expected to cover around 100 million families (close to 40% of Indian population) when fully operationalised.
This is an expansion of an existing scheme called RSBY, under which India's poorer families were insured by the government to the tune of INR 150,000 (US$ 2,100). Under PMJAY the insurance coverage is increased from INR 150,000 to 500,000. The second component is the expansion of existing sub health centres, under the name of Health and Wellness Centres (HWC) to provide free primary care in rural areas.
PMJAY: Sinking public resources for private profits?
While PMJAY has received the highest increase in this budget and represents close to 10% of the total MOHFW budget, the allocation remains highly inadequate for what it proposes to do. The current allocation (INR 64 billion) is lower than the government's planning body Niti Ayog's own calculations that at least INR 100 billion is required, just to pay premiums.
Yet, health economist Indranil Mukhopadhyay shows that even this calculation corresponds to a grossly underestimated premium payment of INR 250 per person per year. This would be largely insufficient to ensure adequate hospital treatment of the covered population. He suggests that the numbers should be in the range of an allocation of above INR 600 billion to be adequate – a figure closer to the total health budget of the MOHFW.
This points to the inadequacy of the health budget, which stands at around 1% of GDP (union and state budgets combined), instead of the long-standing promise of 2.5% of GDP or the WHO recommended 5% of GDP.
Private players have welcomed the move towards a consolidation of insurance-based health provision and are also proposing their own estimates. Private providers are demanding that the allocation for PMJAY be increased to INR 2,500-3,000 billion if the government wants it to be sustainable for the private sector to be meaningfully involved. This would mean that while the government does multiply its budget from the current 1% of GDP to the recommended 5% of GDP, it fully sinks public funding for healthcare into mostly private provided hospitalisation for 40% of the population through PMJAY, with little resources for primary care provision. Further this would also mean that 60% of the population will either have to pay on their own for healthcare services in the private sector, or rely on a further neglected public health system.
Flawed public–private partnerships in healthcare
Experiments with the earlier avatar of PMJAY, the RSBY, have shown that where the public healthcare sector is weak, the scheme gives a boost to the private sector. Data from 2016 shows that 80% of reimbursements under the scheme were made to private enterprises, though in smaller hospitals. Big players in healthcare hospitals (the so called luxury hospital sector) have welcome the increase coverage as 40% of India's population would become potential buyers of the treatment rates they offer.
PMJAY essentially incentivises private investment in healthcare, not only through this assured market share, but with subsidies as well, such as facilitated access to land and viability gap funding, as was announced in a recent press release.
Not surprisingly, the government push for PMJAY has been criticised by health networks such as Jan Swasthya Abhiyan (JSA). “The Interim Union Budget 2019–20 reflects a definite push for an insurance-based model of healthcare, which comes at huge and disastrous costs of the public provisioning of health. […] When insurance is scaled up in a context where there is a huge inadequacy and inequity in access, and an almost complete absence of regulation, it would result largely in the transfer of public funds into private hands without any matching health outcomes or financial protection.”
The Statement published by the nation-wide health coalition which is affiliated to the People's Health Movement (PHM) calls on the government to strengthen public provisioning of healthcare, ensure adequate supply of free medicines and diagnostics, work towards upgrading of primary health centres and community health centres, improve working conditions of the health workforce and ensure community accountability of public health services. Unions of health workers in particular, and public services workers in general will be an essential ally in exposing the impacts of the current flawed direction of health policy. Clearly, with this budget, the challenge for a just and equitable health system with quality public provision of healthcare at its core has gotten harder for the right to health movement.
Susana Barria is PSI Trade Justice Campaigner in the South Asia sub-region