While recognising the role of private providers, NHP 2017 calls for harnessing the private sector through strategic purchase of secondary and tertiary care to fill critical gaps in the care provision in the public sector.

National Health Policy,World Health Day 2017
Courtesy: Freedom House/CC BY-NC 2.0

Health sector in India is highly fragmented. The fragmentation is not just in terms of financing and provision of healthcare in the country, but also in terms of other dimensions such as alternate systems of medicine, continuum of care, quality of care standards and so forth. Let us look at different dimensions of the health sector fragmentation in India and how the new National Health Policy 2017 (NHP 2017) seeks to address those.

In the Indian healthcare delivery space, public and private sectors operate mostly in isolation of each other. Public funding goes mostly for provision of care by the public sector; and the same holds true of private funding and private provision of care. The interaction between the two sectors is very limited. This is partly because of low public funding of healthcare in India and partly because the private sector, particularly the corporate hospitals, with their overriding profit orientation as well as high cost and price structures, are designed to serve the higher end of the market.

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A limited amount of public funding does go towards “purchasing” of care from the private sector. When such “purchasing” is meant to supplement the public sector, the latter is able to extend the reach of its services meaningfully. However, when such “purchasing” is meant to give patients a choice of providers it places public own delivery system in competition with the private providers. On the face of it, there is nothing wrong in generating healthy competition among care providers. But this may not be a good strategy when there is an acute shortage of health personnel, often resulting in undesirable practices such as poaching of health personnel, moonlighting by the public doctors, diversion of patients from the public to private facilities and so forth. Some of this may be unavoidable in any market economy, but when public funding goes to support competition between public and private providers, it generates multiple contradictions.

While recognising the role of private providers, NHP 2017 calls for harnessing the private sector through strategic purchase of secondary and tertiary care to fill critical gaps in the care provision in the public sector. Further, the policy seeks to improve the efficiency of the public providers not through market competition but by making a “policy shift” away from input-oriented approach to output-based purchasing of care. When funding is input-based, the entire focus shifts on making the requisite inputs available with the assumption that once inputs are in place output would happen automatically. In contrast, output-based funding explicitly rewards performance and thereby incentivises providers to ensure that requisite inputs are in place.

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Besides care provisioning and financing, health sector fragmentation exists among different systems of medicine. Allopathy, of course, is the most popular among different systems of medicine as it is able to provide cure for vast number of ailments/illnesses. At the same time, alternate systems of medicine such as Ayurveda, Homeopathy, Unani and so forth can also be quite effective especially in treating specific kinds of ailments/illnesses, with little or no side effects. Although mainstreaming of alternate systems of medicine started under the National Rural Health Mission, it largely remains an unfinished agenda. The national health policy proposes a three dimensional mainstreaming of alternate systems of medicine by:

  • Increasing the validation, evidence and research,
  • Providing improved access and choice to patients, and
  • Enabling environment for practice of alternative systems of medicine.

Fragmentation in the health sector also exists along the continuum of care. At present, the primary care is totally disconnected from secondary and tertiary care which is highly inefficient from a health system perspective. As a consequence, people seek primary care in hospital setting, at a later stage in a disease cycle, and fail to take advantage of preventive and promotive care, which are thrust areas of the new health policy.

While recognising the role of robust primary care in reducing preventable morbidity and mortality in the country, the policy envisages a shift from selective to comprehensive package of services on assured basis by upgrading sub-centres into “health and wellness centres” and reorienting primary health centres to provide preventive, curative and rehabilitative services. Further, the policy proposes to provide every family a health card that links them to a primary health facility and entitles them for a defined (expanded) package of services. The policy proposes to leverage the power of digital technology in providing continuum of care by establishing two-way systemic linkages between different levels of care.

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Quality of care standards is yet another dimension of fragmentation. At present there are variable standards of care being practiced by health facilities at different levels. The Clinical Establishment Act (CEA) that prescribes basic minimum standards of facilities and services for each type of clinical establishment, has as yet not been adopted by all states. The health policy seeks to promote early adoption of CEA by the remaining states too. Of course, there are higher standards of care too that are ensured through the process of accreditation and certification, but adoption of those standards is voluntary in nature. The health policy recognises the need to adopt and apply uniform standards across the entire spectrum of health sector.

These are then some of the dimensions of the Indian health sector fragmentation. There are other dimensions too like health related interventions outside of health sector such as better nutritional outcomes, road and rail safety, occupational safety, clean drinking water and sanitation, environmental health and so forth. The policy proposes to institutionalise intersectoral coordination at national and sub-national levels as well as highlights the role of public health cadre in enforcing various regulatory provisions with regard to social determinants of health.

A large part of health sector fragmentation has to do with the health system design issues which can potentially be fixed if sound policies and interventions are pursued. But some part of health sector fragmentation has to do with the federal structure of the country. As per the Indian Constitution, health care delivery is a state subject. Each state is free to design its own health system and is free proceed at its own pace in improving health outcomes. The national government can at best incentivise States to prioritise health and make technical assistance available for strengthening its health system. Depending on the choices that States make, health sector at the national level can remain fragmented along some of its dimensions. To illustrate this point, the central government came out with the health insurance programme for the poor, Rashtriya Swasthya Bima Yojana, in April 2008 and incentivised States to roll it out. In response, not only did different states implement the RSBY programme at their own pace but, more importantly, many states introduced state-specific variations leading to fragmentation, among other things, of the benefit package provided under the scheme.

Nevertheless, there is a lot that can be done to reduce the fragmentation in the health sector. The NHP 2017 seeks to reduce, if not eliminate, this fragmentation along several dimensions.

The author is a development economist, formerly with the Bill & Melinda Gates Foundation and the World Bank. Email him ► ahujaahuja@yahoo.com

The views expressed above belong to the author(s).

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