Oxfam India Policy Brief

No. 3, November 2012

Demanding Rights for All

Achieving healthcare for all

The stakes of the current debate around Universal Health Coverage in India are high.1 The coming months will decide
whether the government takes a proactive role in ensuring access to healthcare for all, or whether the status quo will
prevail. The debate has polarised positions on a number of fundamental questions. How should healthcare be funded?
What should be the role of public and private providers? How should the latter be regulated? The choices made, could
determine whether healthcare becomes a reality for all, or whether a majority of citizens will continue to pay an unbearable
price for poor quality services.

Summary
All citizens should be provided affordable, accountable government initiated a number of schemes aimed at
and appropriate health services of assured quality [], with strengthening its ailing public health system the National
the government being the guarantor and enabler of such Rural Health Mission and the recently approved National
services.2 More specifically, it should ensure access to Urban Health Mission, as well as subsidised insurance
a package of essential health services that covers high- schemes and cash incentives for the poor. While these
impact, cost-effective treatments for major diseases.3 programmes are part of a positive momentum, they fall
Since the idea of UHC has gained momentum among decision short of providing the unified framework required. The
makers, the positions of influential stakeholders have Planning Commission took up the issue by creating a High
clashed on its implementation. Should the government be Level Expert Group on UHC. The groups report proposes a
the primary provider of care, or should its role be limited to number of far-reaching reforms: it emphasises the central
managing private providers? Will the country move towards role of public providers, and recommends strengthening
a tax-funded system of delivery or an insurance model? The the public health system accordingly; it calls for tax-based
Planning Commission and the High Level Expert Group it set government funding; recommends abolishing user fees;
up, the Ministry of Health and Family Welfare, private lobbies and suggests defining a national health package covering
and civil society groups have taken divergent positions on all basic health requirements.
these policy orientations. The choices made in the coming The policy orientation since taken by the government
months could determine whether the promise of achieving contrasts with these recommendations. Its model
quality healthcare for all will materialise. emphasises partnerships with private providers, with
Indias health indicators show what is at stake. Life targeted interventions aimed at improving access for the
expectancy, at 65 years, is lower than in neighbouring Sri poor. It does not abolish user fees. Public spending on
Lanka, at 75, Bangladesh and Nepal at 69,4 and further health, which stood at 1 per cent of GDP in 2010-2011,7 sets
away from countries with similar economic development. the government on track to fail its financial commitment
Health indicators among lower socio-economic groups are one more time it is below the 2 per cent pledged in the 11th
distressing: the life expectancy of Scheduled Tribes who fall Five Year Plan and further away from the 2.5 target for the
under the poverty line is eight years less than the national 12th Five Year Plan. This falls very short of the share needed
average, and has decreased slightly over the past 20 years.5 for any meaningful improvement of the countrys neglected
Under-five and maternal mortality, at 50 per 1,000 and 212 public health system.
per 100,000 live births, remains high compared to other As the countrys health policy is being debated, Oxfam
countries,6 and the gap between the poorest 20 per cent India wishes to stress three principles of inclusive health
and the richest is stark, with infant mortality rates more coverage, which find strong empirical backing from existing
than twice as high for the former. health scenarios in India and worldwide. Only by placing
These indicators point at major weaknesses in Indias those at the heart of a coherent system will the promise of
health policy. The public system carries the symptoms of its access to healthcare become a reality for all.
neglect: health infrastructure is decaying; shortage of staff
is severe; drugs are rarely available. Poorly regulated private
Recommendations
providers have spread in this vacuum, and sell services of 1. The government should be the primary provider of
often dubious quality at prices that are unaffordable for the essential healthcare.
poor. This scenario plays into patterns of exclusion: groups 2. Public tax-based funding should cover all essential
that are left behind by the countrys economic development health expenditure.
are not only in poorer health condition, health hazards are 3. The social accountability of health providers should be
also a major cause of vulnerability for them. strengthened by placing patients rights at the heart of
All stakeholders involved in the current debate agree comprehensive regulations, associated with systems
that a change of policy is needed. Over recent years, the of monitoring and grievance redress.
1. The government should be the primary calls for a focused intervention. The government should
provider of essential healthcare. outline a basic package of health services falling under
UHC, and design a procurement policy to curb the costs
The pitiful situation of Indias public health system is a
of the package: prices should be controlled; the use of
ready-made argument for defenders of public-private
generic drugs made mandatory; and the governments
partnerships: they claim that the success of private
international stance defend the countrys generic drug
providers, who account for 82 per cent of patient care,8
producing industry.
proves the failure of the public health system; only
by drawing on the strength of the private sector will
the government solve the countrys health problem 2. Public tax-based funding should cover all
effectively. However, there are at least three powerful essential health expenditure.
arguments against this claim. At 1 per cent of GDP, Indias public spending on health
is one of the lowest worldwide, comparable only to a
First, private hospitals have focused on geographic
few lower income countries in Sub Saharan Africa, as
areas and types of treatments that yield high profit.
well as Afghanistan, Haiti, Azerbaijan and Georgia.14
Investments in health infrastructure have focused on
In contrast, the WHO estimates the average costs of
urban areas. Primary healthcare has been neglected;
providing essential healthcare in lower-middle income
instead investments have gone to more costly
countries at around 6 per cent of GDP.15 Private funds
secondary and tertiary care. Two figures summarise the
complete the countrys total expenditure on health, at
trend: between 1986 and 2006, the estimated ratio of
4.5 per cent of GDP. Direct payments during treatment
government doctors to population in rural areas has
constitute more than 70 per cent of expenditure, nearly
fallen from 0.6 for every 10,000 people to 0.3, against
80 per cent of which are for outpatient treatments,
23 for every 10,000 people recommended by the WHO;9
notably on drugs.16
with 0.2 hospital beds per 1,000 people, against 2.5
recommended by the WHO, physical access to hospitals The consequences on individual lives are dramatic.
and doctors has become a major obstacle in rural The percentage of Indias population falling below the
India.10 poverty line because of health expenditure has been
increasing steadily in recent years. The latest estimate,
Second, public health policies work when they are
which dates back to 2005, is at 6.2 per cent per year.17
applied systematically at very large scale.11 For
More than 40 per cent of the population has to borrow
instance, a vaccination programme should cover
or sell assets for treatments, according to the 2004
a majority of the population to be successful, and
National Sample Survey Organisation. Recent research
the same will eventually hold for numerous other
shows a disturbing link between farmer suicides and
communicable diseases such as malaria and
incidence of chronic illness in the family: nearly one in
tuberculosis. Fragmenting healthcare services across a
two farmers who committed suicide had seen cases of
number of private practitioners therefore risks reducing
serious illness within the family.18
overall health outcomes.
The estimated costs of UHC range between 4 and 6
Third, relying on the private sector in a context where
per cent of GDP.19 Though considerable, this financial
the government lacks the capacity or will to regulate
commitment is achievable: Indias public spending on
it raises obvious issues of accountability, as is
health is not only one of the lowest worldwide, the
exemplified by the range of malpractices mentioned in
countrys total tax-GDP ratio, at 15.5 per cent, is also
the next section.
the second lowest among G20 countries, just after
By highlighting the limitations of private coverage, the Mexico.20 In contrast, the average ration for OECD
three arguments above make a clear case for prioritising countries is at 33.8 per cent.21 Revenue foregone, due
the development of public health infrastructure to exemptions on direct and indirect tax, account for
and staff. The focus of financial engagements and an estimated 6 per cent of GDP 22 enough to cover the
policy attention should be directed accordingly. costs of UHC.
More pragmatically, given available resources and
healthcare needs, the government should focus on Alternative measures of health financing, such as
providing a core set of quality preventive, curative and user fees, need to be assessed critically based on
rehabilitative services that cover common diseases the countrys social reality. User fees are presented
and high-impact, cost-effective interventions.12 as an innovative mechanism to generate autonomous
revenue for public service providers, reduce frivolous
Procurement too requires special attention. Buying demand, and subsidise poor people. However, the
drugs is a major burden for poor patients since medicines reality is more sobering. Most patients who visit public
for free are rarely available.13 Publicly provided drugs health facilities are poor. This significantly reduces
are scarce to start with, and widespread embezzled by the financial interest of the measure. In a context
service providers further exacerbates the problem. This where accountability remains a major issue, targeted

Oxfam India Policy Brief No. 3 | November 2012

 exemptions of the poor pave the way to corruption and qualified practitioner is less than one in two.25 In
discrimination. Other below poverty line schemes show rural areas, where the scarcity of medical staff is
that the government does not have the institutional particularly severe, unqualified practitioners provide an
capacity to keep abuses in check. These observations overwhelming majority of services.
make a strong case for abolishing user fees.
Regulation of the private sector is de facto inexistent:
Evidence also warns against a model that primarily 16 out of 29 states do not have laws that make
relies on insurances. Private providers risk inflating it mandatory for private clinics to register with
costs, by favouring expensive treatments or claiming authorities.26 Resistance against the central Clinical
reimbursement for fictive treatments. The popularity Establishment Act 2010 or state-wise nursing homes
of the Rashtriya Swasthya Bima Yojana for example, regulations have been such that these laws have not
a subsidised health insurance for the poor, should been ratified in many states and are rarely applied
not cover the fact that abuses have spread with the even where they are ratified. Despite various public
scheme.23 The high percentage of out-of-pocket subventions, through tax deduction, transfers of
expenditure for out-patient care also means that funds, and attribution of heavily subsidised land,
insurance covering hospital expenditure cannot private hospitals rarely respect their obligations
replace a system that delivers free basic health towards society mandatory quotas of free beds for
services across the country. In the short term, an poor patients, for example, are commonly violated.27
insurance based model may be easier to implement, Public providers themselves lack accountability:
but the long term advantages of an accountable, doctor absenteeism, embezzlement of drugs, undue
functioning system of public delivery should rule charges and discrimination against certain social
against this quick-fix. groups are not exceptional practices.

Despite these limitations, government-managed Collusions of interest amongst health providers, drug
social insurances for the poor have a role to play in producers and sellers are another source of widespread
the shift towards UHC. Strengthening the public health malpractices: hospitals both private and public
system will take time and the struggle to spur political tend to favour expensive patented drugs, despite
will at central and state level has a long way to go: guidelines by the Ministry of Health and Family Welfare
social insurances will help accompany the transition prescribing the use of generic drugs in government
and ensure that the poor access healthcare without hospitals.28 This shift towards patented drugs comes
delay. The final aim, however, should remain a tax- at a time when numerous generic producing companies
based publicly provided UHC, and social insurances be have merged with multinational corporations focusing
integrated with this system. on patented drugs. Private providers of services and
drugs have become powerful lobbies. Their impact on
The increasing emphasis on cash incentives and policy decisions is also visible in economic policies
cash transfers is another problematic trend. The that are progressively undermining Indias generic drug
experience of the Janani Suraksha Yojana, which industry. These different factors have resulted in a
provides cash to all women who give birth in health dramatic increase of prices.
facilities, shows the ambivalence of such schemes:
while delivery in health facilities has increased, The sensitivity of the sector and the unavoidable
positive impacts on pre- and ante-natal mortality information asymmetry between patient and
rates are harder to establish.24 At the same time, practitioner require a carefully designed set of
cases of malpractice associated with the scheme measures. Regulations should be strengthened: clear
are widespread. In a context where accountability is guidelines should define standards of quality and
weak, cash incentives and transfers need to be used rationality for government and private providers, as well
cautiously. More insidiously, they risk moving attention as costs of treatments for the latter; existing laws, such
away from the more meaningful task of strengthening as the Clinical Regulation Act, need to be implemented
public delivery across the country. without delay.

Patients rights should be at the heart of reliable

3. The social accountability of health providers
mechanisms of accountability. Grievance redress
should be strengthened by placing patients
procedures should be structured around such rights,
rights at the heart of comprehensive rather than relying merely on consumers rights.
regulations, associated with systems of Community audits and monitoring have proven to be
monitoring and grievance redress. efficient tools to improve the quality and perception
Indias health system is notoriously unaccountable. of services among patients:29 they should be made an
Excessive and irrational use of medication is integral part of the effort to develop a health system
widespread. The ratio of hospitals with at least one that provides quality services for all.

Oxfam India Policy Brief No. 3 | November 2012

 16. Ibid.
Notes 17. P. Berman, R. Ahuja, L. Bhandari (2010), The Impoverishing Effect
1 The focus of this brief is on healthcare, in response to current policy of Healthcare Payments in India: New Evidence and Methodology,
debates. However, Oxfam India recognizes the crucial importance of Economic & Political Weekly (XLV:16), pp. 65-71.
adopting a holistic approach to health coverage, addressing factors
such as nutrition and sanitation, and broader social determinants of 18. Meeta, Rajivlochan (2010), Inequalities in Health, Agrarian Distress,
health. and a Policy Avoidance, Economic & Political Weekly (XLVI: 43), pp. 41-
47.
2. {HLEG] High Level Expert Group (2011), Report on Universal Health
Coverage for India, Government of India, Delhi, p. 8. Available at: http:// 19. International averages for countries providing basic care range
planningcommission.nic.in/reports/genrep/rep_uhc0812.pdf, last between 5 and 6 percent of the GDP. A study by Ernst and Young
accessed October 2012. supported by the Federation of Indian Chambers of Commerce and
Industry (FICCI) proposes a figure ranging between 3.5 to 4.5 percent
3. Ibid, p. 16. GDP, but acknowledges that such public investment will reduce out
4. World Bank Indicators, life expectancy at birth, available at: http:// of pocket expenditure by only 20-30 percent. D.B. Evans, R. Elovainio,
data.worldbank.org/indicator/SP.DYN.LE00.IN, accessed October 2012. G. Humphreys (2010), Health System Financing, The Path to Universal
Coverage, Geneva: World Health Organisation, op., cit., p. xv. Ernst and
5. S.K. Mohanty, S. Ram (2010), Life Expenctancy at Birth Among Social Young (2012), Health Cover for India: Demystifying Financing Needs,
and Economic Groups in India, Mumbai: International Institute for New Delhi: FICCI.
population Science. Available at: http://www.iipsindia.org/pdf/
RB-13%20file%20for%20uploading.pdf, accessed October 2012. 20. P. Prakash, Comparison of Tax Regimes across G20 Countries: Focusing
on Property, Wealth and Inheritance Tax, Delhi: Centre for Budget
6. Government of India (2011), Family Welfare Statistics in India, Delhi: Governance and Accountability, supported by Oxfam India (publication
Ministry of Health and Family Welfare, p. X. Available at: http://mohfw. forthcoming).
nic.in/WriteReadData/l892s/972971120FW%20Statistics%202011%20
Revised%2031%2010%2011.pdf, accessed October 2012. 21. OECD statistics, tax revenue as percentage of gross domestic product:
http://www.oecd.org/tax/taxpolicyanalysis/oecdtaxdatabase.
7. CBGA (2012), Response to the Union Budget, Delhi: Centre for Budget htm#A_RevenueStatistics, accessed October 2012.
and Governance Accountability, p. 29. Available at: http://www.
cbgaindia.org/publications_responses_to_union_budgets.php, 22. Based on data: Government of India (2012), Budget 2012-2013,
accessed October 2012. Statement of Revenue Foregone, Delhi: Ministry of Finance. Available
at: http://indiabudget.nic.in/ub2012-13/statrevfor/annex12.pdf,
8. A. Marriott (2009), Blind Optimism, Oxford: Oxfam International, p. accessed October 2012.
3. Available at: http://www.oxfam.org/sites/www.oxfam.org/files/
bp125-blind-optimism-0902.pdf, accessed October 2012. 23. V. Varshney, A. Gupta, A. Pallavi (2012), Universal Health Scare, Down to
Earth. Available at: http://www.downtoearth.org.in/content/universal-
9. Based on data from the Government of Indias Central Bureau of Health health-scare, accessed October 2012.
Intelligence; cited in: Meeta, Rajivlochan (2010), Inequalities in Health,
Agrarian Distress, and a Policy Avoidance, op., cit., p. 41. WHO (2012), 24. S. Mazumdar, A. Mills, T. Powell-Jackson (2011),Financial Incentives in
Measuring Service Availability and Readiness, Geneva: World Health Health: New Evidence from Indias Janani Suraksha Yojana. Available
Organisation. Available at: http://www.who.int/healthinfo/systems/ at: http://www.herc.ox.ac.uk/people/tpowelljackson/financial%20
SARA_ServiceAvailabilityIndicators.pdf, accessed October 2012. incentives%20in%20health, accessed October 2012.

10. K. Yadav, P. Jarhyan, V. Gupta, C. S. Pandav (2009), Revitalizing Rural 25. In rural Rajasthan, about 40 percent of private providers did not have a
Healthcare Delivery: Can Rural Health Practitioners be the Answer? medical degree, and almost 20 percent had not completed secondary
Indian Journal of Community Medicine 34(1), pp. 3-5. school education. A. Banerjee, A. Deaton, E. Duflo (2003), Healthcare
delivery in rural Rajasthan, Economic & Political Weekly (39): pp. 944
11. For this argument see: J. Sachs (2012), Achieving Universal Health 49.
Coverage in Low-Income Settings, The Lancet (380), pp. 944-7.
26. S. Nandraj (2012), Unregulated and Unaccountable: Private Health
12. This is in line with the National Health Package recommended by the Providers, Economic & Political Weekly XLVII(4), pp. 12-17.
High Level Expert Group. HLEG (2011), Report on Universal Health
Coverage for India, op. cit. p. 16. 27. R. Bisht, A. Prakash, A. Virani (2011), Public-Private Partnership in
Medical Care: A Case Study of a Hospital, Delhi: Institute of Human
13. Drugs account for 74 percent of private out of pocket expenditure. HLEG Development, supported by Oxfam India.
(2011), Report on Universal Health Coverage for India, op. cit. p. 28.
28. R. Sengupta (2011), Unholy Alliances in Healthcare Services, Delhi:
14. World Bank data: public health expenditure. Available at: http://data. Centre for Competition Investment & Economic Regulation, supported
worldbank.org/indicator/SH.XPD.PUBL/countries, accessed October by Oxfam India. Available at: http://www.cuts-ccier.org/cohed/pdf/
2012. Unholy_Alliances_in_Healthcare_Services-COHED.pdf, accessed
15. D.B. Evans, R. Elovainio, G. Humphreys (2010), Health System Financing, October 2012.
The Path to Universal Coverage, Geneva: World Health Organisation, 29. A. Shukla, D. Kakade, K. Scott (2011), Community Monitoring of Rural
p. xv. Available at: http://www.who.int/whr/2010/en/index.html, Health Services in Maharashtra, Economic & Political Weekly XLVI(30),
accessed October 2012. pp 78-85.

Oxfam India November 2012

This Policy Brief was written by Lucy Dubochet, Research Manager, Oxfam India, with contributions from Dhanajay Kakade, Programme
Coordinator Health, Deepak Xavier, Essential Services Lead Specialist, Avinash Kumar, Director Policy, Campaigns and Research, Shirin
Naseem, Sanjay Suman and Sanjeeta Gawri, Programme Officers Essential Services.
This publication is copyright but the text may be used free of charge for the purposes of advocacy, campaigning, education, and research,
provided that the source is acknowledged in full. The copyright holder requests that all such use be registered with them for impact
assessment purposes. For copying in any other circumstances, permission must be secured. E-mail: policy@oxfamindia.org/
Published by Oxfam India: 2nd Floor, 1 Community Centre, New Friends Colony, New Delhi-110025, India.

OXFAM INDIA

Oxfam India, a fully independent Indian organization, is a member of an international confederation of 17 organisations. The Oxfams are
rights-based organizations, which fight poverty and injustice by linking grassroots interventions, to local, national, and global policy
developments.

Oxfam India, Plot No. 1, Community Centre, 2nd Floor (Above Sujan Mahinder Hospital), New Friends Colony, New Delhi - 110 025
Ph: 91 11 4653 8000; www.oxfamindia.org

For comments and questions, please write to:

policy@oxfamindia.org; for further information, visit our website: www.oxfamindia.org.