State of Health

It is easy to label president Barack Obama’s exhortations to Americans not to travel to Mexico or India for cheap healthcare as protectionist. It presupposes that all is well with our healthcare. Far from it. We are still heavily dependent on imported technology, equipment and medicines. Obama cannot be faulted for trying to assure Americans that he is working towards quality healthcare at affordable cost on American soil. Maybe, India too needs to take a cue from Obama and realign our priorities to first provide similar healthcare to our 1.21 billion people and then look for medical tourists. Reaching healthcare to the masses is essentially — and will always be so — a government initiative. The government has been successful in extending low-cost but not necessarily quality medical services to some segments. Yet, the great masses do not have quality medical services. To make medical services within the reach of the masses, the government could look at the no-cost subsidy model. Healthcare is too sensitive a sector in India to be exposed to the vagaries of globalisation. India is particularly vulnerable: It has no public healthcare system to speak of. According to a World Bank report, public spending on health is under 10 per cent of total spending. This implies that the average Indian, including the poor, ends up fending for 90 per cent of his healthcare cost. “Health for All” as a goal remains on paper. The private and public sectors put together, the country is critically short of primary, secondary, speciality and super-speciality healthcare. Now health is once again said to be the top billing in the 12th five-year plan beginning next year. The investments, whether made through the public sector, private sector or in private-public partnership, have to be carefully calibrated to the goal of providing essential healthcare at affordable prices to our people. India will be much better placed to serve the world after it has met its own needs. But whether the low-cost, low-quality Indian model is a better option than the high-cost, insurance-driven American system is still a matter of debate. We agree that Indian medical tourism is exclusively a private sector enterprise and cannot be denied its profit incentive. Just like the IT and BPO sectors that thrive on wage arbitrage, medical tourism survives on the arbitrage between the high costs of treatment in the US private sector and the relatively cheap private sector world-class medical services in India. However, there is a side effect of promoting medical tourism. Foreign nationals come for treatment in India and are willing to pay top rates for service at the best hospitals in the country. This is one of the factors that keep rates high and unaffordable for average Indian citizens. A parallel exists in real estate where non-resident Indians pay top dollar that keep realty prices sky-high in certain pockets. The government must not hide its failure to provide quality healthcare to the bottom of the pyramid under the growth story of medical tourism. The rise in medical tourism shows that the quality of healthcare has enhanced in India, but it is just for a selected few. Therefore, instead of criticising Obama, the government needs to find ways to make quality healthcare available to the poor as well.




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