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Transforming India’s Health System

Building a well-functioning health system is a work of decades; but the govt has for the first time initiated systematic efforts by taking a comprehensive view of the health system, writes Alok Kumar, Adviser, NITI Aayog.
Alok Kumar | Mar 12, 2019

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Over the past two decades, India has made noteworthy strides on the health front. We have eliminated polio, guinea worm disease, yaws and maternal and neonatal tetanus. Our Total Fertility Rate (TFR) has reduced sharply from 2.7 in 2005-06 to 2.2 in 2015-16. Contrary to expectations, we were able to achieve the Millennium Development Goals in respect of the Maternal Mortality Ratio (MMR level of 130 against a target of 139) as well as in respect of the Under-5 child mortality target (U5 MR level of 43 against a target of 42).

Compared to the year 2000, we are now able to save, at the very minimum, an additional 10 lakh children under the age of 5 years on an annual basis. The story regarding maternal mortality is similar. On an annualized basis, there are 50,000 fewer maternal deaths when benchmarked against the 1990 levels. A large part of the credit for this should go to the National Health Mission (NHM) with its unrelenting focus on strengthening the public health facilities; with other social and environmental determinants also contributing their bit.

Having said that, it is also true that India’s health system is confronted with multiple challenges. There are significant inter and intra -State differentials in health outcomes with socio-economically disadvantaged groups being particularly vulnerable to gaps in access as well as quality of healthcare available to them. Further, the rising burden of Non-Communicable Diseases (NCDs) in addition to the persistence of Communicable Diseases (CDs) makes the task of health policy makers all the more complex. It is estimated that in the business-as-usual scenario, the NCD burden would cost the nation about $4.58 trillion before 2030. The existing health system is inadequately prepared to meet the challenges that lie ahead of us.

A careful analyis of the state of the health system reveals a story of multiple fragmentations: a fragmentation of payers and modes of financing, of providers of healthcare services and also of the digital backbone running it.

Currently the Government (Union and States put together) spends roughly 1.13% of GDP on health, which is woefully inadequate. As a result, 62% of the healthcare spending is financed by households through out-of-pocket expenditure at the point of care. On this metric, India stands at 182nd position out of 191 countries. Imagine a billion transactions every year where individual patients seek care from a million healthcare providers dominated by the private sector negotiating their own prices for the procedures they undergo. All this happens with minimal stewardship or regulation from the Government. Any health economist would tell you that this perhaps is one of the most inefficient ways of organising the health system.

Even among the organised payers, there are multiple schemes – Central Government Health Scheme (CGHS), Ex-servicemen Contributory Health Scheme (ECHS), Employee's State Insurance Scheme (ESIS), Railway Hospitals, State Governments, Private health insurance companies, Rashtriya Swasthya Bima Yojana (RSBY) etc. This multiplicity of purchasing platforms, apart from fragmenting risk pools into sub-optimal sizes, prevents standardisation of purchasing procedures, imposes a huge compliance burden on the providers. Given that the majority of households were hitherto uninsured coupled with the fact that health premia charged by health insurance companies price out a large number of households, the system offers weak protection from catastrophic health expenditures.

India suffers from inadequate and fragmented delivery of healthcare services. Over 95% of healthcare facilities in India are those which employ five persons or less. Public sector facilities are characterised by low service quality and weak management as they are chronically under-resourced, under-staffed and overcrowded. The Indian health system remains largely dominated by the private sector which provides services at widely varying levels of costs and quality.

Can we think of addressing the massive healthcare requirements of India through such sub-scale facilities? Would they be able to mobilise resources or investments required for their upgradataion? A consequence of the fragmented provider space is that the health records of patients lie buried in manual systems or in some cases disparate IT systems with little standardisation with almost no possibility of interoperability or cross-sharing, thereby limiting the availability of information that could potentially guide the decisions on health policy.

Therefore the NITI Aayog has been pushing for a systems approach to health. In the Three-Year Action Agenda, we have called for a new wave of institution building with a strong and a pro-active stewardship role by the Government to overcome these challenges while leveraging the potential of a mixed health system. A decentralised approach to the design and functioning of health systems built on the foundation of a strong primary and preventive care acting as gate keepers has been recommended.

The good news is that the Government of India has initiated the first steps to comprehensively build a robust health system. For instance, the new flagship initiative of the Government, Ayushman Bharat, seeks to comprehensively strengthen the health system for primary and preventive care as well as for hospitalised care. It rides on the twin pillars of building a strong primary health backbone of 1.5 lakh Health and Wellness Centres to tackle the problem of rising NCDs as well as aiming to reduce the catastrophic health expenditures and improving the access to inpatient health care for the poor in secondary and tertiary facilities through the Prime Minister’s Jan Arogya Yogana (PMJAY).

Creation of the recently notified National Health Authority (NHA) with a coverage of at least 10 crore families for over 1350 disease conditions has perhaps seeded the nucleus of a large national payer, which could potentially set the rules for purchasing care, ensure coordination in approaches of other payers and eventually catatyze the process of merger of payers over time.

In tandem, the Government has also emphasized on public and preventive health, with the launch of several other initiatives like Intensified Mission Indradhanush to improve vaccination coverage of children and pregnant woman; National AYUSH Mission (2014) to universalise cost effective AYUSH services; introduction of rota virus and pneumonia virus vaccines in selected districts to counter pneumonia and diarrhoea among children below two years. Lastly, programmes such as POSHAN Abhiyaan focussing on improving nutritional outcomes; Swachh Bharat Abhiyaan to eliminate open defecation; and National Rural Drinking Water Programme, demonstrates the Government’s commitment to holistically address the social determinants of health like nutrition, sanitation and drinking water.

The Health & Wellness centres apart from providing access to comprehensive primary care to our population can also be the point of contact for creation of Patient Health Records (PHRs) at a population level. NITI Aayog has already proposed a National Health Stack that could serve as a national utility which could service the creation of an integrated health information system by laying down interoperable data standards and facilitate Health Information Exchange subject to rules regarding privacy. As I write this piece, the implementation framework for this ambitious project is being given final touches.

Building a well-functioning health system is a work of decades; but we have for the first time initiated systematic efforts by taking a comprehensive view of the health system, impacting the multiple determinants of health and simultaneously engaging with multiple policy levers. With several potential benefits including a significantly reduced disease burden, longer life expectancies and averting of preventable illness, these initiatives can put India firmly on the path towards achieving Universal Health Coverage.

(Alok Kumar is Adviser (Social Sector), NITI Aayog. He looks after various portfolios such as Health, Nutrition, Women & Child and Education.)