The Indian Healthcare Paradigm

Indian healthcare is a story of great contradictions – it has one of the lowest-cost healthcare systems in the world, yet it is unaffordable to the large majority of its population. While institutions and providers, both private and public, are comparable to the world’s best in secondary, tertiary, and quaternary care, we have a long way to go in providing basic primary care beyond the urban limit where 70 percent of the population resides. Public expenditure on health at around 1 percent of GDP is one of the lowest in the world. For 16 percent of the world’s population, we have a disproportionately high share of global disease burden at 20 percent, coupled with one of the fastest-growing non-communicable disease incidence. At the same time, we have one of the weakest health infrastructure at around 1.3 beds per 1000 people.

FICCI, in partnership with EY, in its report, Re-engineering Indian Healthcare, has deliberated on how these contradictions may be resolved.

The solution lies in a preventive rather than curing philosophy, with focus shifting from sick care to health care in its true sense. A sick-care-based health system, primarily funded by institutions and focused on health services and not health performance, manifests itself in a vicious cycle of health expenditure, where most stakeholders are beneficiaries of sickness and not health. This leads to spiraling costs, which even the most advanced economies of the world are struggling to cope with.

It is imperative for India to avoid this pitfall and target for a hospitalization rate of around 6 percent and overall health expenditure of less than 6.5 percent of GDP (this means per capita healthcare expenditure growing at 1.3 times the GDP growth in real terms) to provide and sustain quality health service to all.

We would need a completely new approach for achieving these reforms, which should involve three pillars – people, process, and technology. When these pillars are re-engineered, we envision a system of care that is patient-centered and free from cumbersome administrative processes, and that overcomes inefficiencies, barriers, and distractions from the real work of delivering the highest quality of care.