forces poor families to sell their precious, and often productive,
assets to pay for medical care. Poor families in India spend
on an average 7 to 8 percent of their annual household income
on health care (Charu C Garg: 1998). World Bank studies
(Raising the Sights: Better Health System for India's Poor:
2001) show that nearly all private spending for health care
is out-of-pocket, and consequently the poor are highly vulnerable
to health risks. The poor generally avoid hospitalization
because of their inability to pay, and absence of effective
risk-pooling (insurance) mechanisms. Not surprisingly, to
most of the poor and middle classes hospitalization frequently
means financial disaster. As the World Bank documents shows:
" Only ten percent of Indians have some form of insurance,
and most of this is inadequate.
" Hospitalized Indians spend more than half (58%) of
their total annual expenditure on health care.
" More than 40 percent of those hospitalized borrow
money, or sell assets, to cover expenses.
" At least one quarter of hospitalized Indians fall
below poverty line because of hospital expenses. This figure
is close to 35 percent in UP and Bihar, and below 20 percent
in Kerala and Tamil Nadu.
are horrific statistics in any modern society. Our very
claim to being civilized is questionable if we cannot address
these problems of inequity in health financing in this day
from NSS surveys shows that public sector in India accounts
for only 19 percent of out-patient care, as opposed to private
sector's 81 percent. The only countries with higher proportions
of private payments on health than India are countries that
have undergone civil conflict and collapse of the public
sector, like Georgia, Cambodia, Mynmar and Afghanistan!
mid 80's to mid 90's, the public sector share of in patient
care fell from 60 percent to 45 percent. Yet another well-known
inequity in health sector is that rural areas with 73 percent
of the population account for only 33 percent of government
health resources. Urban population has thus received more
than five times what the rural population received in per
capita terms! No wonder, the infant mortality rate is 75
per thousand live births, and under-five mortality 103.7
in villages, whereas the corresponding rates for urban India
are 44 and 63 respectively!
public health expenditure itself is very low at 0.9 percent
of GDP, well below the OECD norm of 5 to 7 percent. More
pertinently, the public health expenditure in OECD countries
is of the order of 15 to 20 percent of the total government
expenditure. In India, the share of public health expenditure
is 1.3 percent of the central budget, and 5.5 percent of
states' budgets. The weighted average is probably close
to 3 percent of the total government expenditure, or less
than a fifth of the OECD countries in relative terms. This
gives us a measure of the inequity of health services availability
in India, and the distance we need to travel if a healthy
future is to be ensured to our people.
and health insurance are not the answers either. In general,
insurance coverage is available to only organized sector
employees, and a small number of high-income persons. Out
of India's 370 million workers, only 8 percent are in the
organized sector. The unorganized and poor are unlikely
to benefit from centrally organized health insurance services.
And yet they are most in need of risk pooling and health
coverage. When we realize that even in the US, with the
highest per capita health expenditure, about 44 million
citizens have no health insurance cover, we can begin to
understand the complexity of the problem in India.
health sector deserves much higher priority in our budget
making and public discourse, even as measures are taken
for restoring fiscal health. We need to reinvent the state,
reorder priorities, and make public money do much more in
critical areas. In mature democracies, not a day passes
without public and media attention being focused on health
and education policies, or the state of those services.
Most elections are fought on education and health care issues.
In India, much of our political process and economic debate
is divorced from real issues of life and death and empowerment.
struggle for better health, the fight for accountable democracy,
the quest for people's sovereignty, the desire for economic
growth, and the urge for best value for public money spent
are all inseparable. We are privileged to live in the 21st
century, when all these dreams can be realized without great
difficulty. But we need to wake up and apply the lessons
of past experience to solve our real problems of life and