It observed that India has one of the highest levels of OOPE in the world, contributing directly to the high incidence of catastrophic expenditures and poverty.
New Delhi: The Economic Survey 2020-21 batted for an increase in public spending on healthcare services from 1% to 2.5-3% of GDP, to reduce out of pocket expenditure (OOPE) from the current level of 65% to 35%.
It observed that India has one of the highest levels of OOPE in the world, contributing directly to the high incidence of catastrophic expenditures and poverty.
The report suggested that India should look for a long-term policy on the sector, with an agile health system.
In addition, the Survey applauded that Pradhan Mantri Jan Arogya Yojana (PMJAY) has been a marquee evolution in the direction of providing financial affordability to a large percentage of the Indian population.
The survey warned that unregulated private enterprise can create significant negative effects on the healthcare system.
Stating that it is pertinent as regulation has grown in importance as a key lever for governments to affect the quantity, quality, safety and distribution of services in health system, the Survey, presented by finance minister Nirmala Sitharaman on Friday, recommended creation of a regulatory body.
"The Quality and Outcomes Framework (QOF) introduced by the National Health Service (NHS) in the United Kingdom 2004 as well as other quality assessment practices introduced by NHS provide a good example," the Survey noted.
The Survey also suggested formation of credit rating agencies to assess the quality of health care providers.
It said that since the bulk of healthcare in India (74% of outpatient care and 65% of hospitalisation) is provided through the private sector in urban India, it is critical for policymakers to mitigate information asymmetry in healthcare, which creates market failures.
Hence it recommended "creating agencies to assess the quality of the healthcare providers—both doctors and hospitals". It also said that every hospital may dedicate at least one ward that can be quickly modified to respond to a national health emergency while caring for the normal diseases in usual times.
The Survey pointed out that the recent Covid-19 pandemic has emphasised the importance of healthcare sector and its inter-linkages with other key sectors of the economy.
According to the Survey, the key learning from the ongoing pandemic is that it has showcased how a healthcare crisis can be transformed into an economic and social crisis.
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