Is India Ready for Better Health Care?

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In the heat of the world’s largest election many of India’s biggest political parties are promising better health coverage for the south Asian nation’s citizens.

The ruling Congress Vice President Rahul Gandhi even recently promised free medicine and treatment for the poor.

The main opposition Bharatiya Janata Party has pledged to revamp India’s healthcare policy. It says it will introduce a National Health Assurance Mission to reduce the out-of-pocket spending of citizens.

Not to be left behind, the Aam Aadmi Party, which is contesting national elections for the first time this year plans to make healthcare a right and says it will guarantee availability of essential drugs free of cost to all people.

India could use more investment in its health infrastructure as it spends a smaller slice of its gross domestic product on healthcare than most countries. 

The Indian government spent about 1.4 trillion rupees ($23 billion) last fiscal year on healthcare. However, this represents just about 30% of the total money spent on healthcare in India. The remaining 70% is from the private sector. 

India’s total spending on healthcare is equivalent to around 4% of GDP. China and Russia each spend more than 5% of GDP on healthcare while South Africa and Brazil both spend about 9%.

Still, economists warn that doling out more health freebies without improving how welfare schemes are managed could be a waste of money India cannot afford.

“The problem is the (India’s) implementation is extremely weak,” said N. R. Bhanumurthy, an economist with the National Institute of Public Finance and Policy. 

The country already has numerous welfare schemes. But lack of adequate publicity means the beneficiaries often aren’t even aware of their existence.Then there is bureaucratic red-tape and lack of infrastructure that also comes in the way of their implementation. For instance, the government has distributed health cards to provide insurance to the poor. But the tedious processes often make it difficult for the beneficiaries to process their claims.

Meanwhile, some economists are concerned more welfare schemes could weaken the government’s already-weak financial position.

“The elbow room to spend is very limited,” said Madan Sabnavis, chief economist at Care Ratings. “Unless revenue increases, the government can’t afford to increase spending by much.”

Source: Wall Street Journal

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