Evolution of the Healthcare Policy Framework in India
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This paper traces the history of the evolution of India’s healthcare policy framework, focusing on its major objectives, challenges faced, and outcomes emerged. Though the groundwork for the healthcare framework was laid down by the Bhore Committee’s well-thought-out report in 1946, the country’s attention was focused on controlling and eradicating several communicable diseases in the first three decades post-independence. It was only in 1983 that the country framed the first National Health Policy (NHP) with the goal of improving healthcare services. The NHP-1983 was replaced by NHP-2002, which, in turn, was replaced by NHP-2017. Several other policy initiatives were also concurrently undertaken, which, among others, included Pradhan Mantri Swasthya Suraksha Yojana (PMSSY), National Rural Health Mission (NHRM) (which was subsumed under National Health Mission in 2015), Rashtriya Swasthya Bima Yojana (RSBY), Pradhan Mantri Jan Arogya Yojana (PM-JAY), and Pradhan Mantri Ayushman Bharat Health Infrastructure Mission (PM-ABHIM). The key themes prevalent across most of these policies and specific initiatives included: (i) increasing public health spending and reducing out-of-pocket or catastrophic health spending; (ii) addressing rural-urban inequalities in healthcare; (iii) developing primary healthcare; and (iv) achieving universal health coverage.
Undoubtedly, the country has made a good progress in healthcare facilities post-independence, with a significant improvement in various health indicators over the years, such as life expectancy at birth, child and maternal mortality rate, creating a large pool of medical and para-medical personnel, among others. However, despite these improvements, health has remained a low priority, with public health spending at about 1 per cent of GDP, much lower than many of its peers with similar tax-GDP ratios. Consequently, the out-of-pocket expenditures in India are among the highest in the world, pushing about 55 million people into poverty every year due to catastrophic health spending. The rural-urban divide in healthcare services remains wide, with the relative neglect of primary healthcare. The goal of universal health care has eluded so far, constrained primarily by inadequate public health spending. Research at a global level and experiences of many other countries suggest that achieving the goal of Universal Health Coverage (UHC) will require public health spending to rise to five per cent of GDP. Therefore, both the central and state governments need to commit to raising public health spending to five per cent of GDP in a time-bound manner.
Keywords: Healthcare policy, Healthcare schemes, Primary Healthcare, Universal Healthcare (UHC)
Q&A with the authors
- What is the core message conveyed in your paper?
The key message emerging from the paper is the critical need to increase public health spending in India to address longstanding healthcare challenges and achieve Universal Health Coverage (UHC). Despite significant progress in health indicators like life expectancy at birth, infant and maternal mortality ratio, and the large pool of medical and para-medical personnel, public health spending remained low at 1.0 per cent of GDP for more than 3 decades, and at 1.4 per cent in 2023-24, far short of the 2.5 per cent target set for 2025 by the National Health Policy (NHP) 2017. This underfunding has resulted in high out-of-pocket expenses, significant rural-urban healthcare disparities, and an inadequate primary healthcare infrastructure. India’s healthcare spending is also significantly lower than countries with similar tax-GDP ratios. To improve healthcare services and achieve UHC, public health spending must be raised to at least 5 per cent of GDP in a time-bound manner, which will require an annual growth rate of 18-21 per cent over the next eight years.
- What presents the biggest opportunity?
Emphasising preventive health measures and investing in healthcare human resources can significantly enhance healthcare delivery. By prioritising the implementation of comprehensive, rural-focused primary and secondary healthcare infrastructure as recommended by the Bhore Committee, India can make substantial strides toward achieving Universal Health Coverage (UHC) and improving the overall health and economic well-being of its population. The focus of the healthcare system in India has been on curative health, while preventive health has been largely ignored. Since curative health infrastructure has been heavily concentrated in urban areas, this has created large rural-urban disparities in healthcare. Addressing these imbalances by expanding primary healthcare centres (PHCs) and community health centres (CHCs) is crucial. Furthermore, increasing public health spending to 3 per cent of GDP in a time-bound manner, as recommended, can ensure sustainable improvements. This strategic investment must also include a focus on health research and efficient allocation of resources to address the most pressing needs. Enhanced public health infrastructure and human resources, particularly in under-served rural areas, will reduce out-of-pocket expenditures, alleviate poverty due to catastrophic health spending, and support long-term economic development.
- What is the biggest challenge?
The biggest challenge in improving India’s healthcare system is the chronic underfunding of public health. As health has rarely been a major political or electoral issue in India, it has led to low prioritisation in policy and budget allocations. Economic constraints, with competing demands for limited fiscal resources, mean that health often takes a backseat to other sectors, limiting the scope for significant increases in health spending. Inadequate infrastructure, especially in primary healthcare, remains a barrier to effective health service delivery. The need is to commit public health spending and lay down a clear roadmap and strategy to this effect.
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The Centre for Social and Economic Progress (CSEP) is an independent, public policy think tank with a mandate to conduct research and analysis on critical issues facing India and the world and help shape policies that advance sustainable growth and development.