Thursday February 22, 2018

How govt can provide better healthcare system to more than 125 crore people in India

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With a population of more than 125 crore, contemporary India yearns for another opportunity to become a global leader. Looking at our credentials of democracy, diversity and tolerance, many look upon us as the future of the world. But the rural-urban divide and non-inclusive, lopsided development remain a matter of concern. While Silicon Valley in USA thrives upon the innovative minds of Indians, back home, the country has no credible research and development (R&D) and innovations to boast about. Similarly, Indians constitute 5% of the doctor workforce in USA (and 20% of its International Medical Graduates). Indian health workers are also the pillars of medical services in the Middle East. In contrast, in India we continue to struggle with health challenges. With a massive population load and gross national income per capita of $3,900, India spends just 4.1% of its national budget on health. It has one doctor for 1700 citizens (WHO says the optimal number should be 1:1000). Cuba has 6.7 and America has 1.5 doctors for their 1000 population. With its gross national income per capita of $54,000, USA spends about 18% of its budget on health. However, this is not to say that everything is in perfect shape in USA. In fact, many experts feel that the American health system is ‘broken’ due to its inability to provide health care to millions of uninsured people.

With this background, let us study the basic health care delivery models that are prevalent in the world.

The most prevalent service model is ‘Out of Pocket’. In India, we may not have any problem in understanding this concept: You are responsible for footing the fee and bills to the doctor and/or hospital. Well, many will say, the government does provide free universal health care to all its citizens. That is true. India claims (unlike USA, as we shall see below) that anyone can visit a government healthcare facility and avail treatment literally free of cost. However, in actuality, the government health facilities are dilapidated, over-crowded and dysfunctional thanks to poor work ethics, chronic absenteeism and corruption, thereby limiting the access for a large chunk of population.

Contrast this with Britain’s National Health System (called the Beveridge Model). Here, the government provides health care through its government doctors, clinics and hospitals. The private medical sector is negligible. Everyone is eligible to choose a General Practitioner (GP) who is your primary doctor and avail medical care free of cost (the care is free at the point of use).The government will pay your bills. In communist Cuba, hailed by many as the successful model for a developing world, the same system is seen in extreme form: the whole health care system – be it clinic or a pharmacy- is owned by the government. No doctor is allowed to have a private practice.

Canada also provides a universal health care to its citizens, but in a different way. The government provides every citizen a health insurance (National Health Insurance model). The patient can choose to go to a private clinic or a government doctor or facility.

Germany has a slightly different system. The government mandates a health insurance for everyone, and that is provided by the employer. The employee also contributes a part of that. But the whole system is created not to make profit and must cover everyone, even if unemployed.

The above models are typical examples of what we call Socialised Medicine, where the government pitches in to provide subsidies through taxation. In other words, these are public-funded health care programs.

When it comes to USA, the concept of universal health care becomes fuzzy. According to the Institute of Medicine, USA is an exception among the developed countries that does not provide a universal health care. Here the government hardly runs any health care centres (except a few county hospitals administered by county governments. One famous example is Cook County hospital in Chicago). For a majority of people, health care benefits come through their jobs. In other words, your employer will buy you a private health insurance. You also pay a portion of that premium per month, though. The companies that issue health insurance are called Health Maintenance Organisations (H.M.Os) and they are for profit. But if you become unemployed or operate your own business, you have to buy your own private health insurance. However, for army men, the government provides health care through government–owned and operated facilities (Department of Veteran Affairs). For senior citizens (more than 65 years of age), the government runs a Medicare insurance scheme and thus bears the costs of their medical bills (Canadian system).

Thus it is obvious that India has a mixed system where the government pledges to provide health care, but is unable to meet the demand. The private health sector is robust, but the poor and needy may not be able to use the services for want of money. How do we strengthen the health care system in India, then? We need to increase access to affordable and quality health care for everyone. India needs to increase its budget share on health, particularly preventive and primary health care. In addition, we must produce more doctors and para-medical forces. Instead of running the health facilities itself, the government will do well to broaden health insurance to its citizens and put good regulations in place so that through the private sector, it can provide much needed health care to its citizens.

A MK

The author is a a practicing Neonatologist in Chicago. This op-ed is an exclusive article in his series Musings from Chicago. You can reach out to him at e-mail ID: pedia333@gmail.com and on Twitter @drMunishRaizada.

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How telecom has become driver of economic change in India

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The country's hyper-competitive telecom sector has led the revolution from the front.
The country's hyper-competitive telecom sector has led the revolution from the front. Wikimedia Commons
  • India has done well to stay ahead of the curve in the technological revolution
  • The sectoral change in productivity has been the highest in the telecommunications sector since the reforms of 1991
  • India has managed to provide the cheapest telephony services around the world

For the most part of human history, the change was glacial in pace. It was quite safe to assume that the world at the time of your death would look pretty much similar to the one at the time of your birth. That is no longer the case, and the pace of change seems to be growing exponentially. Futurist Ray Kurzweil put it succinctly when he wrote in 2001: “We won’t experience 100 years of progress in the 21st century – it will be more like 20,000 years of progress (at today’s rate).” Since the time of his writing, a lot has changed, especially with the advent of the internet.

India has done well to stay ahead of the curve in the technological revolution. The country’s hyper-competitive telecom sector has led the revolution from the front. In fact, according to Reserve Bank of India data, the sectoral change in productivity has been the highest in the telecommunications sector since the reforms of 1991, growing by over 10 percent. On the other hand, no other sector has had a productivity growth of above five percent during the same period. It is no wonder that it has also been one of the fastest-growing sectors of the Indian economy, growing at over seven percent in the last decade itself.

Also Read: Social Media in India: Understanding The Dynamics of ‘Facebook’ and ‘Twitter’

Such an unprecedented pace of growth has been brought about the precise levels of change that Kurzweil was so enthusiastic about. Today’s smartphones have the power of computers that took an entire room in the 1990s, and the telecom sector has had to keep up with a provision of commensurate internet speeds and services. Meanwhile, India has managed to provide the cheapest telephony services around the world, which has hit rock bottom after the entry of Reliance Jio. This has ensured access to those even at the bottom of the pyramid.

A rise in internet penetration has distinct positive effects on economic growth of a country.
A rise in internet penetration has distinct positive effects on economic growth of a country. Wikimedia Commons

Even though consumers have come to be accustomed to fast-paced changes within the telecom sector, the entry of Jio altered the face of the industry like never before by changing the very basis of competition. Data became the focal point of competition for an industry that derived over 75 percent of its revenue from voice. It was quite obvious that there would be immediate economic effects due to it. Now that we’re nearing a year of Jio’s paid operations, during which time it has even become profitable, we saw it fit to quantify its socio-economic impact on the country. Three broad takeaways need to be highlighted.

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First, the most evident effect has been the rise in affordability of calling and data services. Voice services have become practically costless while data prices have dropped from an average of Rs 152 per GB to lower than Rs 10 per GB. Such a drastic reduction in data prices has not only brought the internet within the reach of a larger proportion of the Indian population but has also allowed newer segments of society to use and experience it for the first time. Since the monthly saving of an average internet user came out to be Rs 142 per month (taking a conservative estimate that the consumer is still using 1 GB of data each month) and there are about 350 million mobile internet users in the country (Telecom Regulatory Authority of India data), the yearly financial savings for the entire country comes out to be Rs 60,000 crore.

To put things in perspective, this amount is more than four times the entire GDP of Bhutan. Therefore, mere savings by the consumer on data has been at astonishing proportions.

Today's smartphones have the power of computers that took an entire room in the 1990s, and the telecom sector has had to keep up with a provision of commensurate internet speeds and services. Wikimedia Commons
Today’s smartphones have the power of computers that took an entire room in the 1990s, and the telecom sector has had to keep up with a provision of commensurate internet speeds and services. Wikimedia Commons

Now, this data has been used for services that have brought to life a thriving app economy within the country. So, the second level of impact has been in the redressal of a variety of consumer needs — ranging from education, health and entertainment to banking. For instance, students in remote areas can now access online courseware and small businesses can access newer markets. Information asymmetry has been considerably reduced.

Third, a rise in internet penetration has distinct positive effects on economic growth of a country. These effects arise not merely from the creation of an internet economy, but also due to the synergy effects it generates. Information becomes more accessible and communication a lot easier. Businesses find it easier to operate and access consumers. Labour working in cities has to make less frequent trips home and becomes more productive as a result. Education and health services become available in inaccessible locations. Multiple avenues open up for knowledge and skill enhancement.

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An econometric analysis for the Indian economy showed that the 15 percent increase in internet penetration due to Jio and the spill-over effects it creates will raise the per capita levels of the country’s GDP by 5.85 percent, provided all else remains constant.

Thus, India’s telecom sector will continue to drive the economy forward, at least in the short run, and hopefully catapult India into 20,000 years of progress within this century, as Kurzweil postulated. The best approach for the state would be to ensure the environment of unfettered competition within the industry. Maybe other sectors of the economy ought to take a leaf out of the telecom growth story. The Indian banking sector comes to mind. However, that is a topic for another day. (IANS)

(Amit Kapoor is Chair, Institute for Competitiveness, India. He can be contacted at Amit. Kapoor@competitiveness.in and tweets @kautiliya. Chirag Yadav, a senior researcher at the institute, has contributed to the article.)