Globally, healthcare markets are diverse in their size, scope, and sustainability. There is a clear shift toward Asia owing to the size of the market population and purchasing power parity. Rapid rise in technologically advanced manufacturing capacity is also accelerating the shift toward the East. Considering India’s large population, there is a significant demand-supply gap, making it a steady and multi-decade opportunity for growth.
The challenge, however, is due to the lower per capita income levels and skewed distribution of healthcare services, both on the public as well as private sector, and it is an extremely price-sensitive market. The Indian healthcare manufacturing spectrum easily covers the full range from low-tech to hi-tech. South India hosts a wide range of MedTech-focussed industries, employing an enormous amount of skilled labour.
The strategic geographical positioning of peninsular India with easy access to international shipping lanes, makes it a potential powerhouse within the global supply chain system.
On government spend in healthcare
Currently at the central level, the budgetary allocation for healthcare as a percentage to GDP is much below expectation, the results of which were made embarrassingly obvious during the COVID-19 pandemic. We need to make substantial investments in the public health system to fulfil our collective aspirations to be a global superpower.
The benchmark for this projected healthcare spend as a percentage of total expenses should not be less than 5 percent of GDP. As per the Indian Constitution, healthcare is in the concurrent list and hence every state in India has the freedom to craft policy meeting the specific requirements of its population. It is essential for the Indian health sector that the central and state governments act in perfect tandem to boost healthcare expenditure.
On your outlook of healthcare
Our vision for health and family welfare is for the people to focus on their health holistically, not just physical but also mental, social, and spiritual well-being. Because of the new-age distractions and disruptions, mainly the active consumption of social media, there is an emerging challenge of mental health issues. As a country, we need to fast-track our mission to achieve the Sustainable Development Goals to cover up the disparities in macro health indicators among various states in India.
From a private sector point of view, we can perceive a bottleneck in the human resource supply chain, considering the systemic issues in our under-graduate and post-graduate education course structure that is currently being looked at by the National Medical Commission. We are not producing enough professionals that the country needs and this has its own adversarial cost impact on the delivery of care. There is also a regulatory challenge owing to the non-recognition of healthcare as a strategic sector, despite it being amongst the largest employers. Policy and fiscal sops like that given to agriculture is the need of the day.
The present COVID-19 pandemic has clearly shown the critical importance of investing in advanced digital technology and innovation. There have to be concrete steps to unravel the scientific R&D bureaucracy prevalent and disrupt the silo approach to science. This single-minded mission-based focus on infrastructure and skilled human resources from the public and private sector can help India to be at the forefront of digital healthcare innovation.
On regulating healthcare
The roll-out of the Clinical Establishment Act across various states will ensure the delivery of a minimally acceptable level of quality standards in healthcare. Other regulatory bodies, such as the IRDA, have already notified that the public and private insurance empanelment can only happen for NABH-accredited hospitals. So NABH accreditation needs to be a mandatory process for licensing of various healthcare service providers across the country.
The shrinkage of out-of-pocket cash expenses toward health services, and the increased role of private and public insurance payers, will accelerate the process of standardization of care pathways, which will reduce cost to the consumer and payer. A good example has already been shown by the National Cancer Grid. In today’s scenario, the role of NABL for accrediting private labs has come into clear focus, in particular for COVID-19 testing. I believe that we will be left with a vast network of qualitatively superior diagnostic facilities soon after this pandemic is over.
On public private partnership
Public-private partnership is essential in reducing the geographical disparities between the large concentration of hospitals in south India and in urban centers, compared to northern and eastern parts of India. The current inclusion of the health sector by NITI Aayog in the PPP policy framework will accelerate investments in this sector, especially in Tier-III and Tier-IV cities and towns, thanks to the availability of the viability gap funding that will take care of almost 30 percent of the capital cost in designated zones.
We have already seen remarkable and successful case studies in the roll-out of the ‘shop-in-shop’ concept for having diagnostic centers, which are privately managed in public facilities.
On areas where government investment is required
The government should focus its attention on public health management of epidemics and pandemics by investing more on preventive health, national immunization programs, school nutrition programs, and provision of potable piped water to all citizens. The existing project to make the entire country open-defecation-free, and increase the LPG distribution to all families below the poverty line, are the right measures to bring about a minimum guarantee of health to the citizens.
Another area where the government needs to focus is continuous reformation in the regulatory framework to increase the supply of competent human resources, which the sector immediately needs, and provide access to long-term soft loans that will make healthcare projects more sustainable.
On policy interventions the healthcare sector in the state needs to align with the healthcare sector at large on a national level
There are very good examples, mainly in south India, with large states like Kerala, Tamil Nadu, and Karnataka leading in many national healthcare indicators.
The best practices in terms of policy formulation and implementation from these states can be incorporated at a pan-India level with a due investment of political capital. If we look at and study the Kerala model, another pertinent aspect is that they have a decentralized structure of governance that includes the health sector; it is a bottom-up approach, which has got large amount of community participation right from the ward to the panchayat level. This model can also be adopted by other states.
Anything else you may like to add
One thing that COVID-19 has taught us is that we need to enhance indigenous domestic research and development and manufacturing capacity. The current bureaucratic silos need to be completely removed. Overall, the country should encourage an ecosystem and leverage on the research and development abilities of the existing institutions, such as CSIR, CCMB, CDFT, IIT, DRDO, ISRO, Indian Institute of Science, and various start-ups in the private sector. There needs to be a collaborated effort from all to focus on manufacturing opportunities in the entire spectrum of healthcare sector, such that we emerge as a global leader in medical devices, pharmaceuticals, and consumables within this decade.
There is also a crying need to have a new central cadre for health services, like the IAS. We need to develop a new Indian School for Public Health that will professionalize the sector and bring scientific rigor in the management of limited resources and focus on better care outcomes.