Learn from world models

Considering the socio-economic diversity this country has to serve, implementation of plans and schemes is marred by slow bureaucratic processes. The discrepancy in development among states is evidently high in India. There are states like Kerala that are either ahead or running parallel with the world in some Sustainable Development Goals (SDG). On the other hand, states like Bihar, Jharkhand, Uttar Pradesh, Chhattisgarh and Rajasthan lag far behind acceptable rates of progress. Socio-economic variety has also meant that it would be challenging for the government to achieve universal healthcare access.

The UN SDGs are correlated to each other. Universal access to healthcare is one of the most elusive goals listed. The National Health Policy (NHP), 2017, specifically aims at universalising primary healthcare, reducing infant and under-five mortality, preventing premature deaths due to non-communicable diseases and increasing government expenditure on health. Imbalance of wealth and a high disease ratio in the country has jeopardised NHP policies greatly.

Universal health coverage becomes a very difficult goal to achieve when 23% of the population, some 276 million people, live below the World Bank accepted poverty line. According to Census 2011, India’s working population (comprising of main workers and marginal workers) formed 39.79% (481.7 million people) of the total population, as against 39.10% in Census 2001. Limited organised sector employment is continuously adding to the poverty burden. Organised sector employment as on March 31, 2011, was 29 million, of which 60.52%, or 17.55 million, was in the public sector.

The population that lives below the poverty line is forced to spend out-of-pocket on healthcare. Many work in the unorganised sector and generally cannot buy health insurance. They often fall into a vicious cycle of poverty, which results from insufficient sources of livelihood and low productivity due to poor health.

Most developed countries have given paramount importance to the provision of public healthcare. There are different types of healthcare management models in practice. One common method of healthcare financing is health insurance. Health insurance models vary around the world.

The British National Health Service system derives its principles from the Beveridge Model, in which the government ensures that every resident is eligible to access government-funded hospitals — financed from taxes collected — without charge. A significant number of the healthcare workforce, such as doctors, nurses or paramedics, are government employees. However, private practitioners collect their fees from the government when they provide public services.

The government is the sole buyer of health services in the UK and can thus exercise effective control on such costs as the doctor’s fee. This helps to minimise the per capita cost of healthcare. Britain, Spain, Norway, Sweden, Finland, New Zealand and Cuba have adopted this model.

Germany practices the “Bismarck model”, where every citizen is covered under a health insurance plan, without the insurer making a profit. These ‘sickness funds’ are financed jointly by employers and employees. At present, Germany has about 240 different funds, and this is a multi-payer model. Tight regulation gives the government significant control over costs. Japan, Belgium, the Netherlands, France and Switzerland, too, follow this model.

The ‘National Health Insurance’ model is a hybrid of the Bismarck and Beveridge models. Private sector services (hospitals and clinics) serve under a government-initiated insurance programme. Every citizen mandatorily pays for this insurance programme, and every citizen is covered under it. There is no financial motive to deny claims. This is a no-profit insurance plan, and a cheap and administratively simple model. The government has immense negotiating powers to keep medicine and diagnostic costs from pharmacy companies and diagnostic service providers to the minimum. Canada, Taiwan and South Korea have adopted this model successfully.

The ‘out-of-pocket’ model is not a celebrated model. The State does not provide much assistance and medical bills are largely paid for by the people. In this kind of system, the rich get medical care and the poor stay sick or die. This model is prevalent in Africa, India, rural China and South America.

Interestingly, the United States has a mixed model which tends to be class centric. Different occupation groups have distinct models. It’s a for-profit health insurance model. For military Veterans, it is Beveridge; for the civilian workforce, it is Bismarck; and for the 15% of people with no health insurance, it is out-of-pocket.

Out-of-pocket chaos

India records 18% of global deaths due to diseases, and chronic diseases account for 53% of those deaths. About 83% of deaths in the country are caused by cardiovascular diseases. In terms of achieving UN SDGs, India ranks a dismal 127th out of 188 countries. Sanitation, air pollution, hepatitis B and child waste were major contributors to the low score.

With a population of 1.3 billion, just 1% of the total expenditure on healthcare is spent by the government. In successful economies, 50-60% of the contribution comes from government. Major illnesses are long-term in nature and subject to a number of diagnostic tests. A substantial proportion of major illnesses in rural areas remain unattended mainly due to unavailability of diagnostic facilities in these places.

Poor hospital and doctor densities, poor penetration of pharmaceuticals and diagnostics means a vast rural community remains perpetually underserved by healthcare. The proposed National Health Protection Scheme (NHPS) does not cover communicable diseases, which is a serious drawback. Exploitative pricing, unchecked corruption and nepotism continue to eat away at the roots of the system.

India should learn from the fallacies of different models available in the world to ensure universal health coverage. With a large population to serve, the country has a unique challenge -- to increase accessibility while keeping healthcare costs low. One solution is to a design health insurance scheme that caters to a large number of beneficiaries so that the premium costs can be brought down to a minimum. With the announcement of the launch of NHPS, the first step towards this has been taken.

(The writer is Associate Professor, IIHMR University, Jaipur)