Does India’s Public Healthcare Need Insurance Based Intervention? A Reading List

A series of articles examine the challenges public healthcare faces in India and why insurance based interventions might not solve them. 


In the Union 2018-2019 budget announced this month, the finance minister Arun Jaitley introduced a “flagship” programme which he claimed would be the “world’s largest government-funded healthcare programme,” benefiting 10 crore poor and vulnerable families. 


Called the National Health Protection Scheme (NHPS)  it will provide publicly funded insurance coverage of   5 lakh per family for hospitalisation. 

But does India’s ailing public healthcare need further insurance based intervention? 

1) Soumitra Ghosh writes that the announcement of the National Health Protection Scheme provides us with an opportunity to see how its predecessor Rashtriya Swasthya Bima Yojana and other publicly funded health insurance schemes have fared so far. The experiences of PFHIS indicate that targeted health insurance coupled with a healthcare delivery system dominated by “for profit” private providers failed to address the issues of access and financial risk protection. They possibly displace resources that can be utilised for strengthening a public health system.


2) T Sundararaman, Indranil Mukhopadhyay, V R Muraleedharan analyse the Health allocations in Budget 2016-17. They highlight how, since 2012, there is a systematic policy incongruence between what government states as policy, and what it does in terms of budget allocations. They argue against the insurance model, stating that the only context when any pro-poor public expenditure in social sectors seems acceptable in this economic regime is when they are routed through the private sector, unmindful of the serious adverse consequences this has had in increasing inequity and impoverishment.


3) Atif Rabbani and Chhavi Sodhi write that ever since the Rashtriya Swasthya Bima Yojana (RSBY) or the national health insurance scheme was launched in 2008, covering all households falling below the state-mandated poverty line, there are growing apprehensions that the current insurance-based access system only serves as a means to use public money to fund private sector expansion and profiteering in the lucrative Indian healthcare market. 


Urban Bias

4) Another criticism of the insurance based model is that it does not solve the urban bias in health provisioning; most  resources and infrastructure is concentrated in urban India. The need for a concerted targeting of rural India led the government to introduce the National Rural Health Mission as its health flagship scheme in 2005-2012. Zakir Husain summed up that even though the investment had a positive impact on several health indicators like immunisation, institutional deliveries and antenatal care,  its overall delivery still fell far short of its targets and left much to be desired. 



Rising Out-of-Pocket Healthcare

5) A number of reforms from the early 1990s onwards notified user charges for various health services in public health facilities. Ravi Duggal and Nitin Jadhav write that, since then, public expenditure on healthcare has seen a decline from a high of 1.5% of gross domestic product in the mid-1980s to a low of 0.7% of GDP in the mid-1990s, recovering to 1.2% of GDP presently. However, out-of-pocket healthcare expenditure has risen dramatically with increased user charges in public health facilities, which leads to further inequities.


Political Culture of Health in India

6) Why is public provisioning and investment in Public Healthcare so low to begin with? Sunil Amrith, takes a broad view of the history of public health in India, to argue that, since Independence, the depth of ambition for public health was unmatched by infrastructure and resources. As a result, the state relied heavily on narrowly targeted, techno-centric programmes assisted by foreign aid; a decision that impacts the political culture of public health even today.



Vacuum of Knowledge

7) Not only is the public healthcare sector neglected financially, it is also afflicted by a vacuum of knowledge: public health education remains woefully inadequate in India. Rajesh Kumar Rai and Theodore Herzl Tulchinsky write that undergraduate degrees in public health should be promoted in order to have an optimum number of public health professionals who can successfully meet the health challenges posed by rapid economic development.


Lack of Personnel

8 ) Amit Kumar Gupta, Neeraj Kumar Sethi and Vijay Kumar Tiwari write about how there is a considerable gap between the health personnel in position and the number required for the public health sector.

In India, the current availability of health HR is suboptimal with a density of:

57 physicians

 44 AYUSH doctors

7 dentists

61 nurses

30 auxiliary nurse midwives

41 pharmacists per lakh population (Planning Commission 2013)

What does this mean for the state of Public Health provisioning? 


Follow the Money

9 ) Since the mid-1980s, the Government of India has actively encouraged the formal private healthcare sector through direct and indirect concessions and policy measures. The poor performance of the public healthcare sector, arising from prolonged inadequate funding and deliberate neglect, is conveniently used by the private sector as well as policymakers to increase private sector participation. Indira Chakravarthi,  Bijoya Roy, Indranil Mukhopadhyay, Susana Barria look at how investment in health has since taken place in India with the withdrawal of the state from healthcare, transformation of healthcare into a commodity, and promotion of the private healthcare sector by the state.


Read More:

Reproductive Health-A Public Health Perspective | Imrana Qadeer

Universal Health Coverage | Special Issue

Politics of Medical Education in India | K S Jacob

Public Financing for Health Coverage in India: Who Spends, Who Benefits and At What Cost? | Indrani Gupta, Samik Chowdhury

Aspiring for Universal Health Coverage through Private Care | Bijoya Roy

Publicly Financed Health Insurance Schemes | Soumitra Ghosh






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