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'Healthcare in India is over-medicalised'

Mar 03, 2009

A recent report of the Independent Commission on Development and Health in India has suggested ways to improve public health services in the country. Economist Jayati Ghosh points out privatisation, inadequate funding, shortage of personnel, and above all, lack of accountability responsible for the current mess.

By now it is a commonplace to bemoan the poor state of health services in India. Public provision of health services is inadequately funded, and their facilities are plagued by overcrowding and a shortage of essential items and of skilled personnel.


They are also insufficiently accountable to citizens. Private involvement in health provision is beset by rising costs and problems of exclusion, huge and growing differentials in the services available to rich and poor, and in adequate supervision associated with various manifestations of moral hazard.

As a result, India’s health indicators are among the worst in the world, which explains to a large extent its appallingly low position in the international Human Development Index.

All this is so well known that it scarcely evokes much reaction any more, apart from a defeated shrug of the shoulders, even among normally concerned citizens. What is more surprising is the apparent paucity of ideas on how to deal with the current mess, beyond the very obvious need to increase public spending on health.

This is what makes the recently released Report of the Independent Commission on Development and Health in India, or the ICDHI (Governance of the Health Sector in India: Has the state abdicated its role?; Voluntary Health Association of India, New Delhi, 2008) such an important contribution.

The report, authored by former Union Health Secretary Javed Chowdhury and other ICDHI members, makes a number of important points and suggestions. Several of these are worth reiterating.

Regional imbalance

The first point, which is generally recognised but still deserves to be highlighted, is the sheer extent of the regional imbalances in both the process and outcome indicators for health. The average health status for the country as a whole is poor and the per capita spending on health is also low by international standards. Public health spending is indeed among the lowest in the world, both as a share of the gross domestic product and per capita.

But this disguises very sharp differences across States. At one end is a group of States (Kerala, Maharashtra, Himachal Pradesh and Tamil Nadu) that accounts for 18.8% of the population and has health indicators similar to those in more developed middle-income countries such as Venezuela, Argentina and Saudi Arabia.

At the other end of the spectrum are the BIMARU-plus States (Bihar, Jharkhand, Madhya Pradesh, Rajasthan, Uttar Pradesh, Orissa and Assam) that comprise nearly 42% of the population and whose indicators are close to those for sub-Saharan Africa and other low-income countries such as Sudan, Nigeria and Myanmar.

The differences across States do not simply relate to the health outcomes but also extend to the financing of health expenditure and the implications for the people. Thus, the poorer States also had less public provision: in 2001-02, public health spending as a percentage of total health expenditure ranged from 7.5% (or Rs 84 per capita) in Uttar Pradesh to 89.2% (Rs 836 per capita) in Mizoram.

However, not a single major State achieved the basic threshold level of Rs 500 per capita public health spending.

The regional disparities also extend to the availability of medical personnel. The availability of graduate allopathic doctors in the country as a whole is only 0.6 per thousand population, but they are unevenly spread, concentrated in the South and in more developed States (Punjab has more than five times the availability of Uttar Pradesh). Also, these doctors tend to converge on urban and peri-urban areas, leaving rural and backward areas especially deprived.

Even medical colleges are unevenly spread: the four southern States have 63% of the colleges and 67% of the seats. The States with the biggest shortfalls in medical personnel are predictably the BIMARU States along with Jharkhand, Chhattisgarh, the north-eastern States, Orissa and Haryana.

Need for regulation and monitoring

The regulation and monitoring of personnel also leave much to be desired: the statutory councils for doctors, nurses, dentists and others are almost dysfunctional. So people are forced to turn to private health services, and in the poorer States impoverished people are forced to pay because government provision is unavailable or inadequate.

Thus, in the poorest States, illnesses involving hospitalisation are more prone to break poor families’ finances. The report cites National Sample Survey Organisation (NSSO) data to show that in Bihar and Uttar Pradesh more than one-third of those who were hospitalised fell into poverty on account of medical expenditure.

Not only are the private, or out-of-pocket, medical expenses borne by households far too high in India but there is also evidence to indicate that they have gone up sharply in recent times.
According to the NSSO, urban hospitalisation costs increased by 126% between 1995-96 and 2003-04, while rural hospitalisation costs increased by 78%.

It is alarming to note that private costs were often borne by households that simply could not afford them. In general, the ICDHI notes, one-fifth of the population that is just above the poverty line will automatically slip into poverty if they face even one serious health crisis.


One important item of medical expenditure for which the increase in costs has been particularly rapid is therapeutic drugs. The average drug expenditure met out-of-pocket is 75%, once again those residing in the poorer States are the worst off. The share of drugs in the medical expenditure of households (both inpatient and outpatient) was as high as 90% in Orissa and nearly that in Rajasthan, Bihar, Himachal Pradesh and Uttar Pradesh. In no State was the ratio less than 61%, indicating clearly that the health system is “over-medicalised”.

This growing expenditure on drugs reflects not only the impact of the new patent regime but also the lack of adequate regulation of the Indian drug manufacturing sector and a lax drug policy that allows the proliferation of non-essential and even irrational or hazardous drugs.

A crucial area that has recently come into the news is the absence of public health security, even in terms of the provision of basic vaccines and drugs. Lack of investment in public facilities has meant that in general they cannot meet the standards set by the World Health Organisation, and the policy of relying on private manufacturers to fill the gap has proved to be futile as they simply did not deliver.

As a result, there is now a shortage of basic vaccines and other essential drugs, which is holding up crucial immunisation programmes and threatens a current and future public health crisis in several States. As for personal health, government health services are obviously inadequate, and the private health insurance schemes that are in existence cover very small pools of people and do not ensure risk-sharing.

So we have a system that is underfunded, under-regulated, irrational, hugely inefficient and very expensive, given the levels of people’s income. What is to be done about all this? The ICDHI makes several important recommendations, suggesting not only more public expenditure but also the allocation of funds, more and different types of regulation, new approaches to training and initiatives to change the current tendencies to over-medicalisation and to depend excessively upon curative rather than preventive health care.

The suggestions are eminently sensible. It is foolish to argue that the overall lack of resources in a poor country is the fundamental constraint. The examples of our neighbours, Bangladesh and Sri Lanka, show that much can be achieved in this regard even in the context of a relatively low-income developing economy. Indeed, it is sad to think that we still need to argue in favour of these very obvious and urgent requirements.

Source : Frontline
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