India’s Healthcare Budget – A need to focus on primary and preventive care

Posted by: at 1/27/2017 01:56:00 am

Gagan Bhalla, Chief Executive Officer, Apollo Sugar

India’s Healthcare Budget – A need to focus on primary and preventive care

India witnesses sweeping changes in 2016 – cash demonetization, digital currency, less tax avoidance, RERA, and other major initiatives from the government. The Healthcare sector, for one, didn’t. Hopefully, Healthcare sees positive and path breaking focus in 2017. In 2016 in the Healthcare sector, there were good improvements made via Swachh bharat, Jan aushadhi, pricing relief for essential drugs, International Yoga Day, and similar efforts. While these are welcome moves, I don’t think these are enough.

As our forefathers have said many times – Health is true wealth. If our young nation doesn’t stay health, it will be far from reaching its true potential in economic productivity as a leader on the world stage. Today, the Indian healthcare sector is massively underfunded – and Healthcare problems in our country will compound exponentially over the next 2 decades if corrective actions and investments don’t start as early as this budget cycle.  A strong healthcare ecosystem is important for the productivity and GDP growth of our nation. India today faces an incredibly huge disease burden in non-communicable (NCD) and preventable diseases. NCDs will cost India approx. USD 6.2 trillion by 2030 (about the size of our 2012 GDP). This NCD burden will cause a massive strain on our already stretched and limited healthcare delivery infrastructure across primary, secondary and tertiary settings of care. Pollution levels in India are one of the highest worldwide. Diabetes disease burden in India is second only to China - and at the rate it is growing, it will beat China in another decade. Even in tertiary or hospital based care, we as Indians, have one of the largest disease burdens worldwide – half the number of cardiovascular surgeries worldwide are done in India – in itself, a reflection of a poor focus on preventive care and healthy living across our Healthcare ecosystem.

In my view, the government must start to prioritize significant, long-term investment commitments in 2-3 critical areas of Healthcare to make it effective and efficient for the next 2 decades —
Increase investment in healthcare delivery, especially in primary and preventive care - To illustrate the power of this impact, let’s look at diabetes care. The cost of managing a diabetic person when they are hospitalized is about 10 times the cost of managing that person in primary care setting three to four times in a year. In spite of that, In India, 1 out of 10 diabetic citizens show up in a hospital every year – this is because they did not focus on accessing preventive care. In more advanced healthcare systems, only one out of 80-90 diabetics gets admitted in a hospital in a year. This is because there is a better focus on primary care where the patient is managed frequently and kept in good heath thus avoiding hospitalization. Indian diabetics typically visit a healthcare facility when they are much further into unmanaged diabetes and related complications of eye/foot/heart/kidney, when treatment costs could be as much as 10-25 times higher than with early-stage detection. If such cases are caught with early screening detection and basic management at a primary healthcare centre, the cost and quality of healthcare for the Indian diabetic will be much better. Today, state-run primary health centres (PHCs), which primarily serve rural areas, are critically short on staff – they typically have a 50% shortfall in supporting staff and 10-20% shortage of doctors. The government should encourage a PPP based model to drive improvement in primary care, and help India health, happy and productive – Government should also offer tax incentives to people who spend money on their Health in the primary care setting and hence avoid expensive hospitalization episodes for themselves and the public exchequer. This tax incentive should be upto Rs 15,000 a year across for full year around primary care spend. Similar to Sec 80D for Insurance tax credit.

Lead a shift to technology based solutions to manage public health disease burden – Today, the Aadhar card reaches the length and breadth of the country – latest estimates show that it reaches 68% of adult Indian citizens. After cash demonetization, every strata of society from the chaiwallah to the sahab is using digital cash in a short span of 3 months! This excellent infrastructure can be combined with mobile (smartphone or non-smartphone) to administer healthcare benefits to the urban or rural poor, and urban or rural senior citizens – these should cover aspects like universal health insurance cover, large scale chronic care screening and condition management programs administered both remotely via call centres / mobile apps, combined with improved physical infrastructure at Primary Healthcare centres. Done correctly, this technology led transformation of our public healthcare infrastructure will be more effective than the Medicaid/Medicare infrastructure of the US to serve our most effected populations (the poor and the senior citizens) at a much lower cost.

Encourage Public – private partnership initiatives in Healthcare –The private corporate companies have developed India specific Healthcare expertise over many decades especially in tertiary care, and are now innovating new models in chronic care to provide truly integrated care models of care to our citizens. If the government starts investing significantly in Healthcare care delivery to manage the oncoming NCD burden over next 2 decades, a public-private partnership based approach will be mutually synergistic and will provide faster, more effective, higher quality and lower cost solutions. This can lend a whole meaning to Make in India.

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