The policies of
the Congress-led UPA government and now present government have led to a severe
mismatch between the real needs and the actual availability of health care
services for a majority of the people.
Public sector
health services are in shambles; the National Rural Health Mission (NRHM) falls
far short of the needs of the people; public funded health insurance schemes of
the Centre and of States are inadequate as these cover only in-patient care in
hospitals and a small subset of ailments; and rampant corruption plagues the
public health system.
The absence of
adequate public healthcare services has created a vacuum, thereby forcing
people to increasingly depend on private providers. As a result, the private
health sector is growing rapidly, and is today being led by networks of
corporate-owned hospital chains. This sector is largely unregulated, expensive,
often provides care of dubious quality, and is plagued by complaints of
unethical and negligent behaviour. India has one of the most privatized
healthcare systems in the world accounting for 80% of outpatient care and 60%
of in-patients care.
An estimated 8
crores people are pushed below the poverty line every year because of forced
expenditure on healthcare. A large
part, about 70%, of out-of-pocket payments goes towards purchase medicines.
Only a small proportion of medicines are provided free of cost, while over 80%
of medicines are directly purchased by patients. New medicines are especially
prohibitively expensive as, after the amendment of the Indian Patent Act in
2005, Indian pharmaceutical companies are unable to produce cheaper versions of
new drugs. Most new drugs are now sold by multinational corporations at prices
much beyond the reach of most Indian patients.
Meagre Allocation of
Resources for Health
The financial allocation by Central and State governments to the health
sector should be increased to at least 5% of GDP, as recommended
by the WHO. India has for too
long had among the lowest levels of public expenditure on healthcare in the world).
Both the Common
minimum programme of UPA I and the Eleventh Five Year Plan had promised
increase in public health expenditure to 2%-3% of GDP. However, current public
health expenditure in the country stands at a mere 1.2% of GDP.
There is a massive gap between the Five Year Plan projections and
actual allocation. The Eleventh Plan had projected that allocation to the health
sector would be increased to 2% of GDP (0.87% of GDP by the Centre and 1.13% of
GDP by States). In contrast, it stood at a mere 1% of GDP -- 0.32% of GDP by
the Centre and 0.68% by the States -- at the end of the Eleventh Plan period in
2011-2012.
Table: Global
Trends in Public Expenditure on Health
|
Country/Region
|
%
of Public Expenditure on Health
to
Total Health Expenditure
|
|
India
|
29.20
|
|
Average of High income countries
|
65.10
|
|
Average of Low income countries
|
38.78
|
|
Average of Middle income countries
|
52.04
|
|
World Average
|
62.76
|
Source: World Bank Database
National Rural Health
Mission -- Starved of Funds
The National Rural Health Mission (NRHM) came into being in
2005 due to demands from different sections fighting for better health care.
The Left Parties played an important role in pushing the UPA I Government to
set up the NRHM. However, since its launch, funds released have been only
one third of what was promised - Rs.66,000 crore as against Rs 175,000 crores
envisaged under the approved framework of the NRHM. Funds released during the
11th Plan were less than half of the original Plan outlay. Powerful forces within
the government, led by the Planning Commission, actively proposed that large
parts of public funded health care should be handed over to the private sector.
Inadequate Public Health
Services, Lack of Infrastructure Development
and Employment Squeeze
Today, public health expenditure accounts for only 20% of
total health expenditure and includes the services of only 20% of the country’s
health workforce. There are huge gaps between the requirement of personnel and
the present situation. At the sub-centre, primary health centre (PHC) and
community health centre (CHC) levels the gaps are to the tune of 17 per cent, 18
per cent and 33 per cent respectively. The shortfall of specialists is even
more shocking. There is a shortfall of surgeons of 76 per cent, of
gyneacologists of almost 67 per cent, of physicians of over 80 per cent and of
pediatricians of around 72 per cent. Such gaps exist right up to the primary
level of care, including for ANMs and nursing staff.
By virtually halting government investment in public sector medical colleges and by
simultaneously encouraging private medical and nursing institutions the Government has contributed to the present,
extremely unhealthy, situation. The situation is further compounded by an
almost complete lack of regulation of these private sector institutions
and the promotion of the corporate sector.
Corporate Takeover of Health Care in India
The
declining state of India’s public system is undeniably linked to the ascent of
a private sector that now has a majority share in various components of health
care. There has been a proliferation of private medical colleges that have
created human resource shortages in the public system; the growth of an
unregulated medical equipment industry contributing to booming costs of care;
and of a powerful pharmaceutical industry that manufactures and sells
overpriced, irrational medicines and drug combinations.
Table: Share of the private sector in India’s health system
(%)
Medical
graduates and post-graduates 90-95
Outpatient
care 80
Indoor
patients 60
Undergraduate
seats in medical colleges 45
Manufacture
of medicines 99.5
Manufacture
of medical devices 100
One
very visible manifestation of the private takeover of health services is the
mushrooming of corporate hospitals. Hospital chains’ revenues have grown
exponentially in recent years. For example, the total nationwide revenue of
Apollo Hospital, the largest corporate chain in India, rose from Rs 16.1
billion in 2009 to Rs 31.5 billion in 2012. The rules of the game have shifted
from promoting public health to mere profiteering as made possible by
corporate-friendly regulations. There is also a large body of evidence that
shows how private providers entice patients with false claims and promises,
fleece poor patients, and provide inadequate care. Regulatory agencies such as
the Central Drugs Standards Control Organisation (CDSCO) and the Medical Council
of India (MCI) have been largely ineffective in controlling these. The MCI
itself is mired in corruption.
The current
Clinical Establishments Registration and Regulation Act lays down guidelines
for regulation, and it has currently been adopted only by a few states. The Act
needs to be broadened since it does not mention the principles of patients’
rights or ensuring public health obligations of private providers.
National Health Insurance: Who benefits?
The Employees
State Insurance Scheme (ESIS), designed to protect workers health through
public services has been systematically neglected. There are attempts by the Government
to promote publicly funded health insurance schemes run by private insurance
companies, where health care services are largely outsourced to the private
sector. These include the national RSBY scheme and several state level schemes
such as the Arogyashri programme in AP. They only cover in-patient care at the
secondary and tertiary levels and have contributed little in improving overall
access to health services. These schemes have become a way of transferring
public money to private insurance companies and private hospitals. There is
increasing evidence of misuse of the scheme by private service providers to
make profits though unethical means, while providing poor quality services.
For example, in
the case of the Arogyasri scheme in Andhra Pradesh, the total payments to
facilities accredited under the scheme from 2007 to 2013 amounted to Rs. 4,723 crore,
of which Rs. 1071 crore was paid to public facilities and Rs. 3652 crore went
to private facilities.
Beneficiaries of
these schemes are only insured against a set of ailments that require
hospitalization at secondary and tertiary levels of care. They do not provide
comprehensive health care, and are limited only to a pre-defined package of
procedures.
The health
insurance schemes also starves primary care facilities. In 2009-2010, direct
government expenditure on tertiary care was slightly over 20% of total health
expenditure but if one adds spending on the insurance schemes that focus
entirely on hospital-based care, total public expenditure on tertiary care
would be closer to 37.42% In Andhra Pradesh, following the implementation of
the Arogyasri scheme the proportion of funds allocated for primary care fell by
14%.
BJP’s Vision of Health Care in India
Is the BJP’s vision for health care any different from that of the
Congress led UPA? In fact the BJP promises precisely the same disastrous, pro-private
sector policies that have destroyed public health services in India. Its 2009
election manifesto says the following: “The BJP will launch a massive programme, through
public-private participation, to introduce a ‘Health for All’ scheme based on
an innovative insurance policy. Under this scheme, the premium of BPL families
will be paid by Government. Beneficiaries will have access to Government and
private hospitals for cashless treatment”.
While the BJP is projecting its supposedly
successful Gujarat model of development, a 2012 Planning Commission study
places Gujarat at the bottom 6 of 21 major Indian states as regards access to health
care services.
Table: Ranking of States’ Performance
in the Health Sector, 2010
1-Kerala; 2 – Tamilnadu; 3 - West Bengal; 4 – Odisha; 5
– Bihar; 6 – Karnataka; 7 – Goa; 8 – Punjab; 9 – Himachal Pradesh; 10 –
Chhattisgarh; 11 – Andhra Pradesh; 12 – Maharashtra; 13 – Jharkhand; 14 –
J&K; 15 – Assam; 16 – Gujarat; 17 – Uttar Pradesh; 18 – Rajasthan; 19 –
Madhya Pradesh; 20 – Haryana; 21 – Uttarakhand.
It may also be
noted that Gujarat ranked 13th among 17 big states in the ‘hunger
index’ (state hunger index, 2008) and worse than Orissa. Expenditure on health
as percent of total state government expenditure is 2.83%, well below the
national average of 3.60%. Further percent of state GDP spent on health in
Gujarat is just 0.38%, well below the national average for all states at 0.59%.
(2009 figures)
Abandonment of the “Free Medicines” Scheme
It is estimated
that 50% to 80% of the Indian population have no access to the medicines they
need. According to World Medicine Report of the World Health Organization, 649
million in India -- the largest number of the people in the world -- do not
have access to essential medicines. Paradoxically, India is the 3rd largest producer of drugs (by volume) in the
world and exports medicines to over 200 countries.
In his
Independence Day speech in 2012, Prime Minister Manmohan Singh had announced that
all essential medicines would be made available, free of cost, in all public
facilities and this scheme would be financed by the Central government. However,
the responsibility has now been shifted on to State governments. Schemes to
provide free medicines in public facilities are operational in a few states like
Tamilnadu, Kerala and Rajasthan. But, the free medicine scheme of Rajasthan is
now being neglected by the present BJP government, which considers it as ‘Congress
scheme’!
Removing Control on Drug Prices
The number of
drugs covered has come down from 342 in 1979 to 74 in the Drug Price Control
Orders (DPCO) of 1995. After a Public Interest Litigation was filed by the All
India Drug Action Network (AIDAN) in 2003, highlighting that high drug prices
were a major cause for catastrophic medical expenses in the country, the
Supreme Court issued a directive to expeditiously put in place a mechanism to
control essential drug prices to affordable levels.
In response to
the Supreme Court directive, the government has now introduced price control on
348 drugs listed as essential. However, marginal benefits (if any) are likely
to accrue because the new DPCO fixes ceiling prices based on an average of
existing prices in the market (a departure from the earlier practice of fixing
based on manufacturing cost). This methodology would largely reflect the price
of the brand leaders, serving to legitimize the rampant overpricing of drugs
today. This (the new formula for price fixation) is nothing but a parting gift
by the UPA government to the pharmaceutical companies.
Proliferation of a Blatantly Unethical
Clinical Trials Industry
India
has become the preferred destination for conducting clinical trials, a large
number of them by MNCs through Contract Research organizations (CROs). The
Government has encouraged this by changing the Drugs and Cosmetics Act in 2005.
There is extensive evidence that regulatory measures are being circumvented in
the conduct of many such trials. Many of these trials also target women,
especially poor women who are vulnerable. MNCs prefer to conduct trials in
countries such as India as the costs are less than half of that in developed
countries, and further, because they believe it is easier to flout regulations
and laws.
The Supreme Court was forced to intervene –
responding to a Public Interest Litigation -- and issued an order in January,
2013 revoking the powers of the Central Drugs Standard Control Organization and
banning clinical trials for new chemical entities unless these were personally
vetted and cleared by the Union Health Secretary. Subsequent rulings of the
Court have asked that stringent guidelines for conduct of clinical trials,
norms of compensations for those who suffer adverse effects, etc. be issued. However,
there continues to be tremendous pressures from the Industry to again allow
clinical trials to be conducted as before.
Promoting de-industrialization and MNCs
and Destroying the Public Sector
India can take
credit for the first major initiative in a developing country to achieve self
reliance in the area of manufacture of medicines. This was made possible as a
result of three major developments: 1) The Indian Patents Act of 1970 which
superseded the colonial Act of 1911 and allowed Indian companies to produce
drugs that were patented by foreign companies; 2) Initiation of manufacture of
drugs from the basic stage by Indian public sector companies like Hindustan
Antibiotics Limited (HAL) and Indian Drugs and Pharmaceuticals Limited (IDPL);
3) Implementation of the recommendations of the Parliamentary Committee on
Drugs and Pharmaceuticals (known as the Hathi Committee), through the Drug
Policy of 1978, which imposed several restrictions on the operations of MNCs
and provided preferential treatment to Indian companies.
Unfortunately,
all these three initiatives have been reversed in the last two decades. HAL and
IDPL were systematically and deliberately undermined as a result of inept
management and withdrawal of preferential treatment. Both
the UPA and NDA governments have been responsible for virtually closing down
almost all public sector drug units including those which were producing
vaccines. The 1978 policy’s major thrusts were diluted and reversed in
successive policies in 1986, 1994 and 2002. And finally, the 1970 Patent Act
was amended in 2005, because of India’s joining the World Trade Organisation
(WTO) in 1995.
Today the most
disturbing trend in the drug industry is that de-industrialisation has
increased at a frightening pace and many companies are dependant on imported
bulk drugs. Further, many large Indian private sector companies, are tying up
with MNCs. The ball was set rolling by the Ranbaxy – Glaxo Smith Kline tie up.
This was subsequently followed by the takeover of Ranbaxy (then the largest
Indian company) by a Japanese company – Daichi. In the past five years several
Indian companies have been acquired by MNCs. Takeover by multinationals of Indian companies will further orient them
away from the Indian market, thus reducing domestic availability of the drugs. The
reversal of trends in the drug market is evident from the fact that of the 10
largest drug companies in India in 1998-99, only one (Glaxo Smith Kline) was a
foreign company. Today three of the top ten companies are foreign owned
(Ranbaxy, Glaxo Smith Kline and Piramal).
In spite of clear signs that MNCs are poised to take
over the Indian drug Industry again, the UPA government continues to allow 100%
FDI in the pharmaceutical sector through an automatic route. Contrary to the
claims of the government 100% FDI companies are entering the Indian market only to
repatriate profits and are not interested in bringing in any novel technology.
Drug Patent Regime
The change
in the Indian Patent Act in 2005 took away a valuable tool available with
Indian companies. The health safeguards in the 2005 amendments to India’s
patent laws (introduced through pressure by the Left Parties at that time) are
being used to an extent to ensure continued access to new drugs. There have
been several positive judgments pronounced recently that have made use of the
health safeguards. These include the issuing of the first compulsory license
(i.e. a license to an Indian company to produce a patented drug manufactured by
a foreign company) for an anti-cancer drug (Sorafenib), reversal of the first
drug patent since 2005 that had been issued for a drug for Hepatitis-C
(peg-interferon), and the upholding of the refusal of patent for an anti cancer
drug (Gleevec) to Novartis.
In spite of
these victories many new drugs are now being granted patents and are way out of
the reach of almost all Indians and Multinational corporations continue to try
to challenge the positive parts of the Indian law. The Government should
establish an institutional mechanism to monitor the impact of patented medicine
on access to medicine and recommend suitable measures to ensure access.
Enforcing
US law on Indian Soil
The UPA government has allowed the US
Food and Drug Administration (USFDA) to operate from within India – thus paving
the way for the USFDA to opened its office in New Delhi in September, 2009 and
subsequently in Mumbai. These offices conduct regular inspections in hospitals that
conduct clinical trials, in drug production units in India and even on products
imported into India! They regularly issue notices to drug companies in India claiming
that their products are ‘adulterated’ or ‘sub-standard’ etc. under U.S. law though
Indian drug control authorities have not found them to be so.
Proliferation
of Irrational and Substandard Drug
In
India, an average family spends Rs.3,000 every year in buying medicines and on
diagnostic investigations. It has been estimated that at least 50% of this
expenditure is incurred on irrational or unnecessary drugs and diagnostic
tests. This adds up to a colossal waste of Rs.30,000-40,000 crores every year,
and amounts to an average unnecessary drain of Rs.1,500 per year for every
family. There are an estimated 60,000 to 80,000 brands of various drugs
available in the Indian market. On the other hand the essential drug list in
India contains just 348 drugs. In this situation of extreme anarchy the task of
an already overstretched Drug Control Authority becomes almost impossible to
cope with. A majority of the estimated 80,000 products in the market are either
hazardous, or irrational or useless.
The pharmaceutical companies and the
government regulatory bodies – prominently the Central Drug Standards Control
Organisation (CDSCO) -- are both complicit in corrupt practices that allow this
situation to continue.
At the same time an estimated 8-10% of
drugs sold in India are of substandard quality. Clearly the CDSCO needs to be
indicted for such a situation to prevail. Unfortunately there are a number of
indications that the CDSCO is plagued with corruption at various levels.
Bringing about Real Change
Clearly the
health care system in India is plagued with a range of problems, many of them
deliberately introduced as part of neoliberal reforms pursued by successive
Congress and BJP led governments. We will promote alternative measures
that need to be instituted if the goal of Health for All is to be realized Now!
1.
Enact a Right
to Health Act which assures universal access to good quality and comprehensive health
care for all the entire range of primary, secondary and tertiary services, and
that makes denial or non-availability for reasons of access, affordability or
quality a justiciable offence.
2.
Increase
Public Expenditure on Health, immediately
to 3.6% of GDP and to 5% of GDP in the medium term
3.
Ensure quality and assured availability of health care services
4.
Stop Privatization of health care services
5.
Increase public investment in education and training
of the entire range of health personnel.
6.
Secure access
to quality assured essential medicines and diagnostic services in all public
health facilities, free of charge.
7.
Reverse Exploitation by private hospitals
8.
Absorb, over a period, existing publicly funded health insurance
schemes (RSBY and different state health insurance schemes) into an expanded
public health system publicly financed.
9. Ensure access to essential
and safe Drugs & Devices: Cost-based price-control of all medicines,
measures to ensure drug and device safety, banning of irrational medicines and
irrational combinations, opening of generic medicine outlets in adequate
numbers, mandatory provision for doctors to write generic names of medicines,
use of the public health safeguards in the Indian Patent Act to promote access
to medicines, and active promotion of indigenous manufacture of most drugs and
devices.
10.
Regulation of clinical trials and ethics in biomedical research: Develop
a clear
framework for the ethical conduct of clinical trials in India, combined with
the regulation of all those that are involved -- sponsors of trials, CROs,
ethics committees etc. Fair compensation norms for trial participants who
suffer from adverse events to be expeditiously developed and implemented.
