Editorial: Step up healthcare spending

The most important lesson that India needs to learn from the devastating coronavirus pandemic is the urgent need to overhaul the public healthcare infrastructure. The pandemic has exposed the country’s creaky health infrastructure, a sector where things cannot be expected to improve overnight. However, there seems to be no urgency on the part of the […]

The most important lesson that India needs to learn from the devastating coronavirus pandemic is the urgent need to overhaul the public healthcare infrastructure. The pandemic has exposed the country’s creaky health infrastructure, a sector where things cannot be expected to improve overnight. However, there seems to be no urgency on the part of the Central government to step up the share of public health expenditure. At present, India’s expenditure on healthcare accounts for just 1.17% of the GDP, one of the lowest in the world. It has one of the lowest health workforce in the world. The coronavirus pandemic should have served as a wake-up call to revamp the sector on a mission mode. While the Centre’s spending on public health was 0.9% of GDP in 2015-16, its share had merely increased to 1.17% in 2020-21, the first full year of Covid-19. In fact, the Economic Survey 2020-21 admitted that India ranked at 179 among 189 countries in terms of prioritising healthcare in the government budget. According to the National Health Policy 2017, the public health expenditure is expected to be increased to 2.5% of the GDP by 2025. Unless the Finance Minister provides for an exponential budgetary increase in public health allocation over the next three years, the target cannot be reached. Over the years, the public health spend in terms of percentage to the GDP has not moved much despite increasing overall allocation for the Ministry of Health and Family Welfare (MoHFW).

Many infectious diseases could be prevented and controlled with a robust public health system and adequately trained public health personnel. Poor public spending on healthcare is a key hurdle in the fight against infectious diseases. The successive governments in India have ignored the public healthcare system leading to a situation where primary and secondary healthcare centres in most parts of the country lie abandoned or unmanned. The pandemic has brought into sharp focus the country’s broken healthcare system, abysmally low public spending and skewed priorities when it comes to addressing the challenges from infectious diseases. From shortage of masks and protective gear for medical professionals to woefully inadequate number of ventilators and ICU beds, the country had faced myriad challenges in the initial stages of the pandemic. Higher public health spending would help in reducing the overall out-of-pocket (OOP) expense by patients, especially enabling access to healthcare for the poor. OOP expenditure is the payment made directly by individuals at the point of service where the entire cost of the health service is not covered under any financial protection scheme. In India, the OOP share was 60% of the total expense on public health in 2021-22, one of the highest in the world. As the pandemic shows no signs of abating, a substantial increase in healthcare expenditure may be the only way out.

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