Public hospitals are bearing the burden but government policy is oriented towards private hospitals and insurance companies

The present crisis has exposed the gross inadequacy of the public health system

It has exposed private hospitals as useless in the struggle against this virus

Yet the government pursues privatisation instead of investing in public health care

The battle against the Corona virus is being fought mainly by the doctors, nurses and paramedical staff in government hospitals, who are severely overworked at this time. There are not enough beds for those needing treatment. There is only one government doctor in our country for every 11,000 persons, which is one-tenth the ratio recommended by the World Health Organisation.

When Prime Minister Modi announced a 20-lakh crore package under the signboard of Atmanirbhar Bharat Abhiyan, people naturally expected that it would contain substantial funds for strengthening the public health system.  However, all such hopes were dashed to the ground by the time the Finance Minister finished presenting the details of this package on 17th May.

Finance Minister Sitharaman promised “increased investment in public health”, without specifying by how much and by when. Similar promises have been made many times in the past.  However, the level of health expenditure by central and state governments combined has remained less than 1.5% of the national income or GDP for the past 10 years. The 12th five-year plan had proposed to increase this ratio to 2.5% by the end of 2017. This target has now been pushed back to the year 2025.

The only concrete commitment announced by the Finance Minister was to spend Rs. 4100 crore (0.2 percent of the total package) to assist states in meeting the current demand for personal protective equipment and other materials required for fighting the Corona virus.  Given that there are 28 states, this works out to an average of only Rs. 146 crore per state.   

The Finance Minister’s announcements included various medium-term initiatives being supported by a loan from the World Bank for “India COVlD-19 Emergency Response and Health System Preparedness Project”. One of its major aims of this project, to be implemented during 2020-24, is to further increase the role of the private sector in health care.

Private hospitals and clinics employ the majority of doctors in the country.  They account for two-thirds of available beds and about 80 per cent of ventilators and ICUs.  However, they are contributing less than 10 per cent to the fight against Corona virus. Most private hospitals have either closed down or are demanding money from the government to compensate for the decline in the number of patients.

While the fight against Corona virus has so far been concentrated largely in cities and towns, it has now begun to spread to the villages as well.  And the shortages of staff and supplies in rural public health facilities are even more acute than in urban areas.  In community health centres, which are 30-bedded public health institutions in rural areas, 80% of positions for doctors and 40% of positions for lab technicians are vacant.

Private institutions are notorious for fleecing hapless patients, by recommending tests they do not need, keeping hospitalised patients for a longer time than necessary, etc.  A survey conducted by the National Sample Survey Organisation (NSSO) during July 2017-June 2018 found that the average amount spent by hospitalised patients was Rs. 31,845 in private hospitals, more than seven times the average of Rs. 4,452 in public hospitals.

Overall, only 30 percent of the total expenditure on health is borne by the central and state governments, while 70 per cent is met by the patients themselves.

Instead of addressing the chronic and growing shortages of staff and supplies in the public health system, successive governments in New Delhi have been pursuing the policy of privatisation.  The health sector is being converted more and more into a source of maximum profits for Indian and foreign capitalist companies.

Between 2013-14 and 2017-18, total premium collected by private health insurance companies increased from Rs. 15,000 crore to Rs. 33,000 crore, implying an annual average growth of 22%.  The “New Health Policy” announced in 2017 was aimed at further accelerating the growth of private hospitals and private health insurance companies. 

Foreign companies have started investing big money to buy up major hospital chains in India.  American investment company KKR has backed Radiant Life Care to acquire Max Healthcare.  Another American investment firm TPG Capital, along with Singapore-based Temasek, are reportedly trying to buy the Medanta hospital chain.  IHH Healthcare, a Malaysian-Singaporean private group which is Asia’s largest, bought Fortis in 2018.  It has also acquired Continental Hospitals and Global Hospitals. 

The Ayushman Bharat – National Health Protection Scheme, launched in September 2018, is a publicly funded insurance program, under which governments pay the policy premium for poor people to access private hospitals.  In the name of public-private partnership (PPP), district hospitals and other public infrastructure are being handed over to private operators.

While the present crisis has highlighted the importance of rapidly increasing budget allocations for strengthening the public health infrastructure in all states, the Government of India is persisting in the drive towards privatisation of health services. It is clear that it cares more about guaranteeing private profits to Indian and foreign capitalist companies than about ensuring adequate and affordable health care for all.


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Jun 16-30 2020    Struggle for Rights    Political-Economy    Economy     2020   

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