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Insights into Editorial: Private healthcare with public money


Insights into Editorial: Private healthcare with public money



health care



It is widely acknowledged that health is pivotal for human development and nation’s future. India which is home to 1.2 billion people has made important progress, as average life expectancy at birth has risen to 65 years for male and female combined which is twice the time at late 1940’s. In addition, India is also free from polio. However large section of population doesn’t have reliable and affordable access to good quality healthcare. India’s healthcare system is far behind those of other emerging economic powers.


Public health funding in India:

India contributes to 21% of the global disease burden, but has one of the lowest public health spending in the world. Although there has been rapid economic growth in the country in the past two decades, funding to public health care, surprisingly, has not been a priority for successive governments. Currently, India, one of the fastest growing economies in the world, spends only 1.3% of GDP on public health. This is the lowest among the BRICS nations.

The draft National Health Policy 2015 document highlighted the need to increase public health funding to reach 2.5% of the GDP by 2020, a much needed and welcome step, which however may not be sufficient, given the magnitude of the problem.


Need for the involvement of private sector in the healthcare sector:

It is true that the public health system in India has improved in recent years but it still remains in bad shape. The main reason for this is a highly inadequate spending and an acute paucity of trained manpower. An influx of funds to address the various infrastructural and technological deficiencies is urgently needed. The majority of the population in India lives in the rural areas and strengthening rural public health care systems should be an immediate priority.


Significance of a privatised system:

People are no longer satisfied with general panaceas for their ills. Some patients may want a quick fix if possible, but a large number prefer to have their condition diagnosed and treated with the help of all available technology. Moreover, this is both scientifically and legally required.

  • Individualised care is obviously easier in private than in government institutions. One can choose both the treating doctor and the time and place of treatment. In certain conditions the patient may want to choose the method of treatment as well. This is especially true for surgery where more than once option is available, such as between endoscopic and open removal of a gall bladder. It can be even more critical when there could be a choice of a life support device such as a pace maker.
  • A privatised system can also provide better nursing and allied services. It can provide better facilities for attendants and other care-givers. Patients and their relatives are not pushed around, neglected and ignored. Such care may also provide patients with a choice of convenient timings, treatments and costs, though these factors can be limited in both private and public sector settings.
  • Thus, privatisation has helped improve health services – their type, scope, quality and consequences.


The price of privatisation:

However, privatisation may lead to steep hike in health expenditures, attributable to the increased costs of medical consultations, drugs and devices, medical tests and hospitalisation. Everybody involved has to earn; private medical practice is a profession, not just a public service.

  • Because of the pressure to make a profit, many private doctors, hospitals and diagnostic centres promote uncalled-for investigations and treatment in order to recover their initial investment. So, services with limited value will be popularised and promoted to many people – whether or not they need it.
  • Privatisation may also encourage unhealthy competition among the groups involved, since the objective is not only to earn, but to earn more than others.
  • Privatisation leads to the relative neglect of problems from which there is little to earn. Everyone including the state is interested in setting up commercially viable units. National preventive programmes get neglected.


Push for association with the private sector:

Two recent developments related to public health in India hold the prospect of changing the nature of service provision for the people. Both lean heavily on the private sector in an effort to improve the deplorable state of healthcare services for India’s 1.3 billion people.


  1. Delhi government policy:

Recently, a new policy by the Delhi government was announced which said that the government would pay for surgeries of private citizens conducted at private hospitals. These surgeries would be ones that the government would not be able to conduct expeditiously at its own facilities. The Delhi government’s effort is a giant leap in establishing distributive justice. However, the Delhi government needs to be mindful of the fact that implementation holds the key to universalization of such schemes.


  1. Niti Aayog proposal:

NITI Aayog has released a report on the public-private partnership (PPP) model in healthcare. As per the report, the government is keen to rope in the private sector to support service provision in the districts. The PPP model will work alongside the public health system and will be chargeable. However, only those patients who are not covered by any government scheme will be covered by this model.

However, experts say the proposal does not further the idea of justice. It goes against the spirit of India’s national health policy, which seeks to provide “free, comprehensive primary healthcare services for all aspects of reproductive, maternal, child and adolescent health and for the most prevalent communicable, non-communicable and occupational diseases in the population”. The policy recommends “strategic purchase of secondary and tertiary care services as a short-term measure”, but not services people would pay for.



A common point between the NITI Aayog proposal and the national health policy is that both support government schemes which provide preferential care to government employees in the present and future. India’s privileged elite believe they deserve quality care before others. Economists such as Adam Smith and Amartya Sen have focused on justice as equally as economics—the two being inseparable, since without justice, economics is merely budgeting devoid of ethics. Therefore, it is imperative, nevertheless, to ensure that the association with the private sector is rooted in principles of justice rather than merely financial expedience.