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Low healthcare spend worrying

Dr Kenneth Thorpe Jun 24 2017, 1:47 IST

The National Health Policy 2017 was a much-needed step to address the healthcare situation in the country. However, it has taken too long for a country with such a high population and it should have been accorded priority much before.


It is important that in India, a country of 1.2 billion-plus people with a robust democracy and economy, the health of its people is accorded priority in the manner that it truly deserves.


Lack of focus on health can have serious implications, not just on the state of the health of people and the misery that it causes, but also in dragging the economy of the country down several notches.


Let’s look at some numbers first to set the context India bears a staggering 21% of the world’s disease burden. While infectious and communicable diseases are still ruling, there is a shift happening and more than 53% of total deaths every year in India are now due to non-communicable diseases (NCDs) like cancer, diabetes and heart disease. In fact, by 2020, over 60 million Indians are expected to succumb to them.

What is worse is that the shooting figures of the disease burden and deaths in the country are being fought with dismal figures of public spend on health care.

There’s extremely high, about 61% out-of-pocket expenditure, one of the highest in the world, and very low health insurance coverage: only 25% of the population, again one of the lowest in the world.

Until the Cabinet cleared the Health Policy, healthcare spend was pegged at a little more than 1% of the GDP. The new policy is aimed at universal health coverage for all and recognises that there are many critical gaps in public health services which would be filled by 􀍞strategic purchasing􀍟.


Commercial insurance
One of the main mechanisms of strategic purchasing is insurance. The policy states its objective to integrate public-funded insurance schemes into a single-payer system.

However, more needs to be done to give better space to commercial insurance, which relies on payment and pooling, to cater a larger population.


Also, we must notice that the Indian healthcare expenditure has grown slower than the other economies. Which is why the proposal of increasing health expenditure to 2.5% of GDP seems very low in comparison to what has been achieved by the neighbouring countries. Moreover, there is no roadmap laid out to achieving these targets.


The policy needed to be more specific about the way these targets will be achieved to give a clear picture of how the government plans to accomplish these objectives. We need to prioritise and understand the nation’s problems better to be able to solve them appropriately.


According to the latest figures available, in the year 2015-16, only 3% of the total health budget was earmarked for NCD programmes.

This doesn't make sense as according to the United Nations and the World Health Organisation, the burden of NCDs is expected to cost India $6.2 trillion during the period 2012-2030.

Minimum allocation

What is shocking is that even out of the bare minimum allocation to healthcare, a huge part does not even get spent. In fact, a sum of Rs 48,649.35 crore has remained unspent over the last three financial years (2013- 16).

Responding to a query in the Lok Sabha, Minister of State for Health and Family Welfare Anupriya Patel said that against an allocation of Rs 1,69,544.54 crore (Central and state combined) in 2015-16, the reported expenditure was to the tune of Rs 1,57,729.76 crore.

I feel this is a huge shame that so much money goes unspent when there is so much need, pain and suffering. There is need for urgent and sustained action in this sphere and improve people’s ability to pay.

There is a desperate and timely need for in-depth study on why this is happening with clear-cut policy recommendations or the Prime Minister’s Office’s executive orders to fix this discrepancy.


Fixing this inefficiency issue is an essential step to make the government accountable to the people, and to at least make the sparse money available travel far. Investing in health for any country is actually a no brainer, and should be done on a war footing.

(The writer is Chairman, Partnership to Fight Chronic Disease)

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