Healthcare plays a crucial role in the economic progress of a country by impacting the well-being of its people and the productivity of its workforce. In India, every dollar spent on healthcare has the potential to generate returns of up to three dollars. However, in order to achieve this, it is essential to establish an efficient healthcare system that is driven by two key elements: building a robust healthcare infrastructure and ensuring access to reliable insurance.
Healthcare infrastructure encompasses the physical, organizational, and technological resources required to deliver medical services, while insurance involves funding the medical needs of individuals. While India has made significant advancements in healthcare, there are still challenges in providing high-quality and equitable healthcare to all citizens.
One of the critical factors in improving healthcare infrastructure is a higher allocation to public health spending. Currently, India’s healthcare spending is only about 2.2 percent of GDP, which is significantly lower than the global average of 6 percent.
To address this, focused investment is needed in three main areas: expanding hospital bed capacity, enhancing primary healthcare infrastructure, and improving clinical education to tackle the shortage of healthcare professionals. India currently has only 0.79 government hospital beds per 1,000 people, well below the global average of 2.7 beds. Meeting the National Health Policy 2017 recommendation of two beds per 1,000 people would require an additional 2.4 million beds. Increased healthcare spending would not only improve care but also stimulate economic growth by creating jobs in the sector.
India’s primary healthcare infrastructure also requires immediate attention, as many public health centers are under-resourced and lack essential equipment and trained personnel. Additionally, there is a persistent shortage of healthcare professionals despite efforts to increase medical seats. By expanding medical school capacity and enhancing education quality, India can develop a more skilled workforce to meet the growing healthcare demands.
Another crucial aspect is ensuring insurance coverage for the “missing middle” – the 30 percent of India’s population that lacks financial protection for healthcare. To bridge this gap, the government should focus on providing affordable health insurance for this vulnerable segment. This could involve collaborating with the private sector to design low-cost insurance products, along with offering tax incentives and subsidies.
Furthermore, setting up a dedicated healthcare account for corporate social responsibility (CSR), ensuring contributions from small and medium-sized enterprises (SMEs) and large corporates to health insurance programs, and creating a separate allocation for health insurance within the health and education cess charged as part of direct tax are other measures that can help enhance health infrastructure and improve access to insurance.
By implementing these measures, India can make significant strides towards ensuring a healthy and more productive population, thereby driving the country’s overall progress.
