India and universal healthcare: follow-up

A drug industry event on healthcare access last week provided an opportunity to connect with Dr Srinath Reddy, president, Public Health Foundation of India and the man who led the team that authored a state-funded report on Universal Health Coverage for all  Indians, released late last year.  Dr Reddy gave the keynote address at the Organisation of Pharmaceutical Producers of India, or OPPI’s, conclave on Improving Access, Innovation and Reach of Healthcare in Mumbai.

This blog has identified healthcare as an emerging political issue, and commented on the need for greater debate and public engagement on universal healthcare. It has also raised questions about  how an ambitious free generics drugs programme,  planned as a follow-through of some recommendations made by Dr Reddy’s team in its report, is to be implemented. See here, here and here.  As a follow-up to those posts, here are some key takeaways from Dr Reddy’s presentation and chat with journalists after.

On the case for universal healthcare

According to 2006 National Sample Survey Organisation (NSSO) statistics, 28 per cent of India’s rural population and 20 per cent of its urban population had no funds for healthcare. 40 per cent of those hospitalised resorted to borrowing or selling assets to fund healthcare. 35 per cent of those hospitalised fell below the poverty line as a result of hospitalisation.

Low and middle-income countries have moved swiftly to universal healthcare. Mexico has attained 100 per cent health coverage, China and South Africa close to 100 per cent.  India has varying models to pick and choose from.

On state-backed health insurance schemes being popular but not viable

Insurance schemes fragment healthcare, do not provide full coverage of needed services and fail to cover the whole population, says Dr Reddy. In Kerala, the centre-state-sponsored Rashtriya Swasthya Bima Yojana (RSBY) (which pays pre-determined package rates for set procedures in empanelled public and private hospitals) has seen premia almost treble in three years. Reason? The utilisation rate is 130 per cent i.e. claims exceeded premia collected by 30 per cent. The public sector insurer in Kerala has threatened to walk out if premia are not hiked.

Other insurance schemes such as Aarogyasri (targeted at so-called “catastrophic illness”) that are sponsored by individual states are well-intended but do not cover drugs,labs, and out-patient care which form the biggest chunk of out-of-pocket health expenditure. Plus they offer no cover for primary healthcare.  Poorer sections of households in such schemes also experienced a rise in per capita healthcare expenditure because of “add-on costs” imposed by hospitals.

In AP, the state that pioneered Aarogysri, the government is now directing a good percentage of scheme-funded surgeries to public hospitals so that the money that they receive can be ploughed back into strengthening infrastructure at these hospitals. This is after costs went through the roof.

Reddy and his co-authors have asked for all these health insurance schemes to be reviewed.

On implementation of the free generic drugs programme

From October, the centre will be in a position to release funds. However, it is up to each state to select the pilot districts and centres and plan allocations.

On involving the states in the plan for universal healthcare

The ministry of health’s plan to ask for comments from states on recommendations in the Reddy report has been delayed.  Some state health secretaries have read the report, others haven’t. It is important to bring all chief ministers together. Things should start happening at a higher level of government.

To view/listen to Dr Reddy’s full presentation click here.

Pic sourced from


2 thoughts on “India and universal healthcare: follow-up

  1. Gauri, Can’t resist but add to this wonderful and honest submission….Before leaving the venue remember Prof. Reddy telling us in a lighter vein – Iraade Nek Hain, Par Avrodh Anek Hain….It perhaps points at a larger story.


  2. This has really been an eye opener for Indian government and administrators who have not been able to come up with centralized universal health plan which would take care of all health care needs of the growing population and provide them quality cost effective services.


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