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Roll no- 16BA079

Topic - Write a brief note on the existing public health care

delivery system and its associated challenges in India.
According to you what priority steps should be taken by the
government to overcome these challenges?

According to the World Health Organization's Health report in 2000, India stands at 112 out of 190 nations.
Accruing to this number various questions may arise in our mind. The sector which couldn’t manage to prevent
itself from sickness focuses on curing ailments. Is it because of policy implementation, allocation or the rising
population? What are the possible amendments for the development of the Indian health care system?

Before we talk about policy implementation we must talk about the adequacy of resources. India spends only
4.2% of its GDP on healthcare goods and services out of which a significant percentage is spent on the urban

luxurious hospitals. Hence, the amount allocated for the rural sector, which has high dependence ( 70% of
rural population), is quite low. Now, Why is this allocation low? Partly because the sector is not profit oriented
and lags behind in terms of innovation and research Or we might blame the tax based funding and the tax
evaders as well. Consequently, a major proportion of the rural population temporarily migrates to the urban
areas in search of better medical facilities and end up settling in the already dense area. This migration
syndrome makes the local multiplier weak and economic growth slow. The obvious answer to low spending in
rural health care system is lack of incentive, paying capacity of service takers, inadequate infrastructural
facilities and insufficient human capital. All these variables or factors are interdependent and hence form a
feedback loop. Since the rural healthcare is 'not so profitable', job incentives and compensation is low, which is
why allocation is low and so on...The spiral continues until one of the variables is controlled externally i.e. need
of investment. The human development index calls for the need of basic healthcare and infrastructure
development. Additionally only a small percentage of the population has access to sanitation. Approximately 1
out of 6 is born underweight and 7% of them die before turning 5. Infant mortality rate and maternal mortality
rate are the major concerns of the Indian health sector. For instance, a study in rural Madhya Pradesh found
that only 11% of the sampled healthcare providers had a medical degree, and only 53% had completed high

According to the Indian brand equity foundation, India is the 3rd largest exporter of pharmaceutical products
while its rural population doesn't have access to generic medicines. It would not be wrong to say that the
above problem is aggravated by the research and patenting norms of India. There is a lack of incentive to
research and innovate because the proliferation and fraudulent practices promote deal-making over
innovation. Unlike India, technology and medical devices constitute a major proportion of the health sector of
any economy as it adds to profitability and efficiency. Despite the growing IT sector, why do the benefits not
reach the health care system? RTGS, bitcoin, e-commerce suggests that the IT sector has been a catalyst for
the development of the financial sector but it is not the case for healthcare. Though the urban-private
healthcare institutions have successfully installed premium medical devices, the rural and public health sector
lags behind due to red-tapism, requirement of sanctions and permits, poor management and lack of human
capital to handle such devices and systems. Another problem non standard diagnostic procedures. Migration
exacerbates this problem and leads to duplication of primary stages of treatment, increases examination
period.Unequal distribution of resources, which includes rural-urban and public-private, compounds the
problem of shortage.

The large unregulated private sector in India takes a major portion of qualified personnel and medical
equipment. While some beds and human resource in the private institutions have more potential than the
actual services generated, public institutions are overloaded. The resources are hence not used to its potential.
There has been, however, a paradigm shift in the health care system over the past two decades. According the
National Sample Survey Office (NSSO) there is a decrease in dependence on public hospitals to 32%. This
doesn't imply a corresponding increase in paying capacity of the service takers as this expenditure is funded by
loans (mostly from the unorganised sector) as reported by Lancet. According to the World Bank and National
Commission's report on Macroeconomics, only 5% of Indians are covered by health insurance policies.
Insurance is hence limited to high or middle income groups which have the necessary documents and a stable
income to pay the premiums. So the healthcare sector of India is characterized by high out of the pocket
expenditure ( approximately 70%). Though the penetration of insurance sector in the Indian market is rapidly
rising and it is counted among the fastest growing segments of business. So the need of a multi payer
healthcare system arises which may increase the profitability of the sector by increasing its reach and
expenditure on healthcare which would be aided by insurance. In the Indian context, access and affordability
along with efficiency of health care services are the primary concerns. Since the rural-public institutions do not
provide adequate services, the need to go to private institutions arise, which is expensive. So the payment
mechanism needs reform and must be backed by insurance which would help breaking the aforementioned

The government has introduced various policies and schemes to strengthen the Indian healthcare system but
these do no t have far reach. For instance, Clinical Establishment Act 2010 provides for registration and
regulation of clinical establishment and also mentions the standard of facilities provided is enacted only in 9
states while the other states don’t have any standardisation norms. While Regulations and checks on
implementation of policies should be reduced, standardisation norms for private medical institutions should
be introduced.

For instance National mental health care bill ( mandates right to care) has been cleared by the cabinet but is
still struck the parliament. The medical Devices Regulation bill, 2006 provides for quality standards for
biomedical equipment manufacturing and marketing is yet to be passed i.e. since 11 years. For affordable and
efficient medical facilities Indian health sector may look forward to the insurance Sector and increasing
incentives for research by better patenting norms and rights.