{"id":64070,"date":"2019-09-15T04:07:18","date_gmt":"2019-09-15T04:07:18","guid":{"rendered":"https:\/\/thepubliceconomist.com\/?p=64070"},"modified":"2019-11-16T05:08:00","modified_gmt":"2019-11-16T05:08:00","slug":"why-regulation-in-the-private-health-sector-in-india","status":"publish","type":"post","link":"https:\/\/thepubliceconomist.com\/?p=64070","title":{"rendered":"Why Regulation in The Private Healthcare Sector in India"},"content":{"rendered":"\n

In 2018 the Government of India\nannounced the National Health Protection Scheme which is also known as\n\u2018Modicare\u2019 or \u2018Ayushman Bharat\u2019 to provide insurance based health services to\n10 million BPL households which started from Jharkhand by the Prime Minister\nhimself. It is the new route for \u2018Strategic bargaining\u2019 from private healthcare\nproviders. It has been launched with the motivation to reduce inequality in\naccessibility to quality healthcare in India. The other most important\nmotivation for this is to reduce high out-of-pocket expenditure, which has\nbecome one of the most important causes of poverty in India. It pushes vulnerable\nfamilies below poverty line because of indebtedness or assets selling.\nOut-of-pocket expenditures in recent time has become a symbol for measuring\ninequality. At the same time the effectiveness of the private sector has to be\nmeasured against all the parameters of access, quality, equity and efficiency[1]<\/sup><\/a>. In\ncase of a country like India, the private sector is highly unregulated and has\nmonopoly to the extent where they use to influence the health policy also. This\npaper seeks to provide a broad overview of the present condition of health\nservices providers in India, the need and effectiveness of monitoring as well\nas regulation for private health service providers by state and the way towards\nachieving public health goals.<\/p>\n\n\n\n

2. Background<\/strong><\/p>\n\n\n\n

From the Alma Ata Declaration to\ntill now many governments including India\u2019s have realized fully and adopted\npartly \u2018Health as a fundamental human right\u2019 and it is the responsibility of\nthe state to provide, fulfill and protect this right. Actually, India has not\nyet invested enough in the enhancement of human resources (in the form of\nsocial security in health and education sector). The public expenditure in\nIndia is very low especially in the health sector which is approx. 1.2 % of its\nGDP. In 2013, out-of-pocket expenditure (OOPE) for health care expenses stood\nat 62.6%.[2]<\/sup><\/a> India\nhas a highly-privatized healthcare system in terms of financing as well as\nprovision of services with the private sector catering to 70% outpatient\nservices and 60% inpatient services[3]<\/sup><\/a>. The\nhealth system in India, like other Low and Middle Income countries has a kind\nof mixed health systems syndrome (Nishtar, 2010) straddled with weak public\nhealth systems and a dominant private sector that is in general unregulated and\nsometimes unethical with their profit oriented approach.<\/p>\n\n\n\n

3. The private sector<\/strong><\/p>\n\n\n\n

In all over the world as well as in\nIndia, the governments want to reduce their fiscal deficit to consolidate\ngovernment surplus by revenue. So, they are trying to harness markets to\ndeliver universal health care for people. Many economists are of the opinion\nthat after bringing private sector in health care it will reduce the cost,\nenhance the performance, create accountability to people and will provide good\nspace for innovation in this sector including finance. The other thing is that\nit is always argued that \u201cprivate sector is more capable of being efficient due\nto competitive market forces. In the private health sector, inputs are linked\nto outcomes and hence \u2018could\u2019 encourage a performance driven environment in\ncomparison to the public health system. The private health sector, as in the\ncase of Private Finance Initiative (PFI), by assuming some of the financial\nrisks, frees up the government resources (for instance, the tolled highways)\nthereby providing for innovative financing options.\u201d[4]<\/sup><\/a> All this in combination would\nresult in potentially providing a \u2018value for money\u2019 service.[5]<\/sup><\/a><\/p>\n\n\n\n

4. Public Private Partnership <\/strong><\/p>\n\n\n\n

The new National Health Policy (NHP)\nlargely focuses on the role of the private sector through strategic purchase\nand contracting of services for the shorter term. This NHP is seeking support\nmostly from the not-for-profit private organizations but the time period for\n\u2018Short-term’ has not been specified. The main reasons behind the introduction\nof PPP in the Indian health sector are :-<\/p>\n\n\n\n