Indian HealthCare Vs United States

Do you know the current status of Indian Healthcare?

Do you know the differences between Indian and US healthcare?

Do you know the current challenges India is facing?

If yes, then this blog is for you

The topic is to give an insight about the current status of Indian Healthcare. In doing so we are doing a brief comparison with the US Healthcare. Ideally, we should not directly compare between the two nation, according to me, but the idea is to bring out an insight as to what is required to progress successfully. There is a vast difference between the healthcare of a developing nation and developed nation. But interchangeably, I can say with every difference we point out, there lies million of opportunities as well.

Let’s start with the discussion on few healthcare problems that India is currently facing and their tactical solutions. Then we can see in detail the differences between the two nations. And then finally, we will look how the future of Healthcare will look like, very briefly though. I am planning to write a separate blog on Future of Healthcare.

Healthcare in any country is laid on 4 pillars as shown below.

Healthcare Pillars

Healthcare has become one of India’s largest sectors – both in terms of revenue and employment. Indian healthcare delivery system is categorized into two major components – Public and Private. The Government, i.e. public healthcare system comprises limited secondary and tertiary care institutions in key cities and focuses on providing basic healthcare facilities in the form of primary healthcare centers (PHCs) in rural areas. The private sector provides majority of secondary, tertiary and quaternary care institutions with a major concentration in metros, tier I and tier II cities.

Indian Healthcare Problems and tactical Solutions

The three most critical areas of healthcare of any country is Affordability, Accessibility & Quality.

Over 95% of the Indian facilities work with less than 5 workers. While, nearly 200 hospitals only are accredited to work with quality certifications. As per WHO standard, the recommendation on doctor’s availability per 1000 population should be 1:1000 but India is persistently short with the ratio of 0.7:1000.

Quality wise also we must improve a lot. Almost 122 Indians per 100,000 die due to poor quality of care each year. You will be surprised to know even our neighbors are doing better – Pakistan (119), Nepal (93), Bangladesh (57) and Sri Lanka (51). Study tells that poor care quality leads to more deaths than insufficient access to healthcare, nearly twice as many as due to non-utilization of healthcare services. It is even more than HIV/AIDS or diabetes for that matter.

Regulators must do a res-assessment of existing policies and programs to see what works and what needs modification to work. For example, the National Health Mission’s inability to achieve targets relating to IMR and MMR despite high budgetary allocation is a key priority.

The existing accreditation ecosystem and quality frameworks in India are quite robust and comprehensive, and hence, it is relevant to promote their adoption. Government programs such as Indian Public Health Standards 2008, National Quality Assurance Standards (NQAS) 2013, Mera-Aspataal (My Hospital) 2016, LaQshya (Labor room Quality Improvement Initiative) 2017, and National Patient Safety Implementation Framework (2018–2025) will help jumpstart the journey in this direction. 

Even though Indian Healthcare lags w.r.t many developed countries but still there are many positives to know.

  • India’s competitive advantage lies in its large pool of well-trained medical professionals. India is also cost competitive compared to its peers in Asia and western countries. The cost of surgery in India is about one-tenth of that in the US or Western Europe.
  • There is an expectation that the Indian healthcare market can increase three-folds by 2022.
  • Indian medical tourism market is growing at the rate of 18 % year on year and is expected to be 20 % by 2020.
  • The hospital and diagnostic centers attracted Foreign Direct Investment (FDI) worth US$ 6.34 billion between April 2000 and June 2019, according to data released by the Department of Industrial Policy and Promotion (DIPP).
  • The Government of India is planning to increase public health spending to 2.5 % of the country’s GDP by 2025.
  • There are some other progresses.
    • The number medical colleges in India increased to 529 in FY19 from 381 in FY13.
    • According to Sample Registration System Bulletin-2016, India has registered a 9 % reduction in Maternal Mortality Ratio (MMR) since 2013. According to WHO mandate it should be 70 per 100000 by 2030, but currently, India stands at 122 per 100000. There are many states which are under EAG (Empowered Action Group) category and needs special attention.
  • The sector is expected to generate 40 million jobs in India by 2030. 100,000 jobs are expected to be created from Ayushman Bharat, the National Health Protection Scheme.
  • Telemedicine is a fast-emerging trend in India and major hospitals (Apollo, AIIMS, and Narayana Hrudayalaya) have adopted telemedicine services and entered into several public-private partnerships (PPP).

India and the US differ widely when it comes to healthcare. In nutshell, below are the basic difference between two countries.

Differentiating  Factors

INDIA

US

WHO HealthCare Performance Rank11237
LIFE at birth expectancy63(M); 66(F)76(M); 81(F)
Health Spends as % of GDP~ 1.14%~ 17.15%
WHO Health Spends as % of GDP Rank184th /1911
Out of Pocket Expenses62% population10-12% population
Public Health scenario$16 / person/ year$10,224 / person/year
Central InitiativePPACA (Obamacare)Nation Health Mission – Ayushman Bharat – 500 million beneficiaries
Mandatory FeaturePenalty if not enrolledIndividuals Discretion
Scope of CoverageComprehensive – from consultation to hospitalizationInadequate scope of coverage, require improvement

Let’s look at the key differences between the two countries in detail.

  1. Public health scenario

India lags far behind developed nations in the public health arena, with clean drinking water, adequate nutrition, sanitation and access to healthcare being long-standing challenges. This year’s Budget, too, has come under criticism for not addressing systemic problems adequately, emphasizing instead health insurance schemes and public-private partnerships.

The picture is far rosier in the US, where per person healthcare expenditure is the highest in the world, approx. $10k per person per year. Successive governments have consistently prioritized healthcare reforms.

According to World Health Organization (WHO) data for countries performing best in the healthcare sector, US ranks 37, while India stands at 112.

  1. In US, the landmark was the Patient Protection and Affordable Care Act (PPACA), better known as‘Obamacare’, which was signed into a law in 2010 with a mission to reform the health insurance sector and to provide more Americans accessible, affordable and quality healthcare services. 

While in India, Under the National Rural Health Mission (NRHM), Ayushman Bharat was launched in 2018. Ayushman Bharat is National Health Protection Scheme, which will cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries) providing coverage up to 5 lakh rupees per family per year for secondary and tertiary care hospitalization.  

  1. Other Reforms and Regulations

This topic is a vast topic to discuss in detail. I am sure, if I start writing about it, it will become multi page document. So, in the constraint of topic, let’s discuss very briefly about them. I will create a sperate blog to go over all in detail.

US Regulations and law bodies

There are many federal laws that have a significant impact on the health plans, and we will look briefly at some of the most important ones:

  1. Under antitrust laws, health plans must not engage in activities that restrain a free, competitive marketplace, such as price-fixing and market allocation.
  2. Under financial services legislation, plans must protect the privacy of consumers’ financial information.
  3. ERISA (Employee Retirement Income Security Act) governs employer-sponsored health plans, establishing participant rights, investment standards, and disclosure requirements. ERISA also exempts employer plans (but not insurers) from state regulation.
  4. COBRA gives employees and dependents certain rights to continue employer-sponsored health coverage for a time after they lose eligibility.
  5. The HMO Act of 1973 sets standards for HMOs that choose to be federally qualified.
  6. Under various laws, employers may not discriminate among employees based on race, age, gender, and similar factors regarding health coverage.
  7. HIPAA (Health Insurance Portability & Accountability Act) of 1996 contains many provisions designed to increase the availability and continuity of healthcare coverage and protect health information & facilitate data exchange.
  8. Role of Accreditation
    • NCQA (National Committee of Quality Assurance) –  measures result and shares information with the consumers and the market. It developed the tools like HEDIS (Healthcare effectiveness Data & Information Set).
    • URAC (Utilization Review Accreditation commission) – formed to evaluate UR process. Later, expanded to evaluate Health Plans & Healthcare facilities.

Indian Regulations and Law bodies

  1. National Health Systems Resource Centre (NHSRC) has been set up under the National Rural Health Mission (NRHM) of GoI to serve as an apex body for technical assistance. The goal of this institution is to improve health outcomes by facilitating governance reform, health systems innovations and improved information sharing among all stake holders at the national, state, district and sub-district levels.
  2. National Health Policy in 2017 (NHP2017) – The GoI in September 2018 launched an ambitious health insurance scheme — Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY).
  3. India has several regulatory boards and provisions to maintain Quality. Like National Accreditation Board for Hospitals and Health (NABH), Indian Public Health Standards 2008 (IPHS), National Quality Assurance Standards (NQAS), Mera Haspatal, Indradanush to name few. 
  1. Proposed Program

There are few programs which may change the Indian health care dynamics in coming days. Like National Medical Commission Act 2019, Nation Digital Health Blueprint, Personal Data Protection Bill (PDPB) 2019.

NMC has been passed by both housed of parliament and will prove to be a milestone in the years to come. The NMC Act aims to repeal the Indian Medical Council Act, 1956 (IMC Act) and constitute the National Medical Commission (NMC), which shall supersede the Medical Council of India (MCI).

  1. Vast difference in spends as % of GDP

In India the total expenditure on healthcare as % of GDP is just 1.15%, while in the US it is 17%. The United States currently ranks highest in healthcare spending among the developed nations of the world. According to data released by the Organization for Economic Co-operation and Development (OECD) in 2018, the U.S. rate was a staggering $10,000 per capita.

Do you know much one person spends in India every year? it’s just Rs 1,112 ($16), less than even the cost of a single consultation at the country’s top private hospitals or roughly the cost of a pizza at many hotels. And that comes to Rs 93 per month or Rs 3 per day.

India’s per capita spending on health is fourth lowest in the South East Asian countries. Indonesia spends nearly twice while Sri Lanka spends about 4 times that of India.

The National Health Policy 2017 talks about increasing public-health spending to 2.5 % of GDP by 2025, but India has not yet met even the 2010 target of 2 % of GDP. Even nations classified as Lower Income Countries by the World Bank spends 1.57 % of their GDP while global average stands at 6%.

Out of the pocket expenditure

A whopping 62 % of the Indian population pays out of their own pocket for medical expenditures. While in US, the out of the pocket expenditure is much lower at 10-12%. This is even causing more stress on Indian Healthcare.

  1. Health insurance is mandatory in the US, unlike India

In the US, it’s mandatory to get health insurance and you have to pay a penalty if for some reason you choose not to get it. Employers in the US, as per government guidelines, are supposed to provide health insurance to their employees. None of the above holds true in India, where the provision or purchase of health insurance is up to the discretion of employers or individuals. 

  1. Scope of coverage

In the US, health insurance cover is generally comprehensive, and includes everything from consultations for, say, a fever to hospitalization. However in India, visits to physicians are not covered under insurance. Depending on the terms of Policy, there are following terms that are covered. This may include Maternity, Pre & Post Hospitalization, Preexisting ailments, Pre & Post Natal expenses, Day Care procedures, differently abled children, critical illness and so on. Still, like many developed nations, the coverage must improve and must cover all the areas from consultations to post hospitalization.

As the data suggest, as high as 86% of rural population and 82% of urban population in India are still not covered under any scheme, public or private, to support health expenditure.

Though the government has been able to bring about 12% urban and 13% of rural population under health protection coverage through Rastriya Swasthya Bima Yojana (RSBY) but lot of effort is still required to bring rest of the population.

In order to achieve the target, now Ayushman Bharat – National Health Protection Mission will subsume the on-going centrally sponsored schemes – Rashtriya Swasthya Bima Yojana (RSBY) and the Senior Citizen Health Insurance Scheme (SCHIS).

This increased benefit is expected to cover nearly 40% of the population (the poorest & the vulnerable).

  1. Premium charges

Since a larger number of people are covered under health insurance policies, with larger scope and a much higher standard of living, the premium rates are generally higher in the US. In India, since the health insurance policies are taken by a lesser % of the population and owing to cut-throat competition amongst various insurance companies, the premiums are much lower. For instance, a 30-year-old Indian male needs to pay around ₹ 500/month to get ₹ 5 lakh health insurance coverage. The numbers differ with different healthcare insurance providers, but you can get decent coverage for about ₹ 10,000 each year. Despite this, medical insurance has a relatively poor reach.

In conclusion, it looks like Indian healthcare is working at a swift pace to resolve Quality, Coverage, Services and increasing Expenditure issues in few years to come. India must work extensively in many areas of healthcare. It depends a lot on the government budget as it has never met the needs. Though budget 2020 is a great step by the government towards its vision of universal health coverage, a 10% increase in the allocation for health sector will make a marginal impact. Analysts in health industry pointed out that even with a 25 per cent increase would still be a challenge to revive the sector in the country. The current Infrastructure status is not in accordance with the Indian health sector. To make Ayushman Bharat viable, government needs to bring down the taxes on medical devices and must encourage the manufacturer of medical equipment & devices in India.

But the future of healthcare is very beautiful when visualized.

TWENTY years from now, cancer and diabetes could join polio as defeated diseases. The future will focus more on the prevention and early intervention, than the treatment itself. In nutshell, we should focus on wellness and preventive healthcare.

The financial burden of rising chronic illnesses, expensive medical technology and infrastructure and rising labor costs will bring some new reforms in the sector. Payment reforms such as value-based payment models can help providers, payers, and patients to achieve the best outcomes and that too at the lowest cost.  Some new model may transition the inpatient procedures from inside hospitals to outpatient settings like ambulatory care units, retail clinics, community health centers and even our homes.

The biggest change visible by 2040 will be the Consumers becoming the center of the health model. Not only will consumers have access to detailed information about their own health, they will own their health data and play a central role in making decisions about their health and well-being. And technology at this point of time will play a crucial role. The stream of health data from variety of relevant sources will create a multifaceted & highly personalized picture of every consumer well being. Data about individuals, populations, institutions, and the environment will be at the heart of the future of health. Data-gathering devices will become exponentially more sophisticated and will continuously track activity, health, and environmental factors. This ongoing monitoring will ensure that health conditions and risks are identified and addressed early.  

In the end I want to say, we know our strengths and we can work on the challenges we discussed above. This is not an impossible task. Thanks for your valuable time in reading the post till now. I will be very happy to see your comments and feedback 😊.

Disclaimer – Views expressed personal.

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