Rewa: The parliamentary standing committee report on affordability and accessibility of healthcare has said that Indian households continue to remain vulnerable to catastrophic health expenditure and impoverishment due to medical expenses. The report was released on August 11, four days after being tabled in the Parliament.The government has constantly projected that the out-of-pocket expenditure (OOPE) has declined. The OOPE is the money that a person spends from their pocket to avail themselves of healthcare. The committee acknowledges this fact and adds that the current government’s health expenditure is merely 1.43% of GDP. “[This] severely hinders the mitigation of catastrophic health expenditures and medical impoverishment,” the committee states.The National Health Policy, 2017, which was framed by the Narendra Modi-led government nine years ago had envisaged increasing the expenditure to 2.5% of GDP by 2025. Lok Sabha MP Ram Gopal Yadav is the chairman of the 31-member committee. It comprises members of Lok Sabha and Rajya Sabha.A very important observation that the committee has made is that the government’s expenditure on health was 1.84% of GDP in 2021-22. This spending was actually driven by “one-off COVID relief and vaccination spending.” This figure wrongly created an impression that the government had increased the health expenditure compared with the years prior to the pandemic. It also gave the impression that the government was slowly moving to achieve the target of spending 2.5% of GDP on health by 2025. The subsequent revisions in health allocation declined to 1.43% of the GDP – a proportion which was the same as the pre-pandemic years. In other words, there has been no actual increase in the government’s health spending for the last six years, at least. Incidentally, the Union government has repeatedly claimed that it has increased allocation to the health sector. An important caveat to point out here is that the “1.43% of the GDP” figure combines expenditures of both the state and Union governments. The latter’s actual and sole expenditure has been only around 0.28% to 0.33% of the GDP on health in the last five years, per the report.A NITI Aayog report published in 2021 said 7% of India’s population – about 10 crore people – are pushed into poverty every year due to the exorbitant amount of money they spend on seeking healthcare. However, some of them come out of this poverty eventually.What is more worrisome, as this report reveals, is that people distress sell assets or land or land in catastrophic debt to afford healthcare. A large proportion of this trend is driven by the fact that private hospitalisation averages Rs 50,508 as compared to Rs 6,631 in public facilities. Moreover, private sector services account for over 70% of all OPD consultations. Similarly they accommodate 60% of all inpatient care for which patients need to be admitted in a hospital. But people don’t go to private facilities by choice. The 361-page report says that low government expenditure on health has constrained the quality and capacity of public sector healthcare. Also read: Health Budget 2026-27: A Tale of Rising Allocations, Falling AccountabilityThe overwhelming reliance on the private sector has resulted in creating an environment where the prices of diagnostics, consumables, medicines, and intensive care remain unregulated. Though the report does not link this lack of regulation and capping of prices, it is a widely discussed fact that had the state governments implemented Clinical Establishments (Registration and Regulation) Act, 2010, (CEA) much of this problem could have been addressed.The CEA mandates standardisation of prices for various types of services offered by hospitals and clinics. It aimed to curb arbitrary pricing and regulate the quality of services. The state governments did not do their bit and the central government did not push them into doing so.The Committee, therefore, recommended that the Union health ministry actively coordinate with state governments “to mandate the uniform adoption and strict enforcement of the Clinical Establishments Act nationwide”. Ayushman Bharat’s drawbackThe government launched the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PMJAY) under which a family is provided an insurance cover of Rs 5 lakh per family, to those which strictly qualify socio-economic criteria. Approximately 12 crore families have been covered. Now it is also extended to all citizens above 70 years – irrespective of those criteria. State governments empanel private and public sector hospitals under this scheme. The Union and the state governments pay insurance premiums to various insurance companies, on behalf of beneficiaries. The Union to state government ratio of spending on this scheme is 60:40.The hospitals empanelled under this scheme are supposed to provide free inpatient services to beneficiaries. Consequently, they can claim treatment charges from the insurance companies. The committee noted that this scheme had created financial protection for over 500 million vulnerable citizens. But a key constraint is that this scheme can create a cover for these citizens only if a patient requires hospitalisation. The bulk of the OOPE for health comes from OPD consultations, which this scheme does not cover. Therefore, the committee recommends the government include OPD consultations also under the PMJAY scheme. The government has so far shown no inclination, whatsoever, to do this ever since this scheme was launched. The committee found that a considerable portion of PMJAY funds were absorbed by the private sector. The reason is the same: The deficiencies in the public health sector force people to go to private hospitals.So what happens is the following: Governments end up spending a huge chunk of their health budgets to pay for services of the private sector. Consequently, they fail to upgrade and improve public health infrastructure. In other words, investing in public health infrastructure could be a long-term gain, but it cannot happen from spending on premiums for mostly private empanelled hospitals. The Committee believes that to build long-term systemic resilience and reduce dependency on private facilities, the public sector’s absorptive capacity must be drastically improved to enable public sector hospitals as tertiary care providersThe committee also goes on to add that improving the quality of public health infrastructure is the most sustainable way to reduce the OOPE. Moreover, a CAG report published in 2023 had exposed corruption at various levels in the implementation of PMJAY.Many times the private hospitals often refuse patients who wish to be admitted under this scheme. They allege delayed government payments. Another reason they cite is inadequate package rates that the government offers to them for their services. The Committee, therefore, had to advise the government that the rates should be periodically changed taking into account rising operations costs. The unavoidable fallout of this move would be the government spending even more money on private hospitals. This would remain a vicious circle unless the governments start improving the public sector. Private sector hospitals also allege that private insurance companies take up to months to pay the bills of the patients who are treated under government insurance health schemes like Ayushman Bharat. Some companies even reject bills due to ambiguously defined “insufficient post-operative investigations,” thus discouraging private sector hospitals from participating in these schemes, the committee flagged. Also read: Health Ministry Obfuscates CAG Findings on Ayushman Bharat to Train Guns at Media ReportsAnother pillar of this scheme was the opening of more than 1.9 lakh Arogya Mandirs to provide basic treatment for non-communicable diseases like diabetes, hypertension, child and maternal care, especially in rural areas. The Health and Wellness Centres were renamed as Arogya Mandir in 2023. One of the biggest challenges with these centres was lack of standardisation of services they provided on the ground. The committee, therefore, recommended that the government come out with “specification in terms of infrastructure, human resources, availability of supplies and the level of services etc. to ensure uniform understanding and implementation.” The Ayushman Bharat scheme covers 12 crore households. But there is about 30% of the Indian population – roughly 40 crore – which is not covered by publicly-funded health schemes which the report reckons as “the missing middle” because they don’t qualify the socio-economic criteria.They have no safety net, as far as government schemes are concerned. While they may be able to pay premiums for private insurance covers, at least, some proportion of them may still suffer with what the report termed as “sudden impoverishment due to medical emergencies.” People at an Arogya Mandir. Photo: Government website.Then there is a big informal sector of workers which may not qualify for government health schemes. The committee asks the government to enhance public health expenditure and affordable insurance products for such uncovered populations. All the deficiencies in the public health sector have been highlighted through multiple arguments in the report but one of them stands out starkly: There is a critical deficit of bed availability in public sector hospitals. Less than one bed is available there per 1,000 patients. Rural healthThe past several editions of the government’s Rural Health Statistics reports have pointed out an acute shortage of specialist doctors in rural areas – Community Health Centres, specifically speaking. The committee says that though the MBBS seats have gone up by 151%, PG seats by 163%, and the induction of over 5.23 lakh personnel under National Health Mission has happened, the “severe shortfall of specialists at Community Health Centres fundamentally compromise equitable healthcare access”. The committee members ask the central government to immediately mandate the state governments to “drastically fast-track the filling up of vacant posts.” One of the reasons often cited for lack of specialist doctors in rural areas is inadequate facilities for them. To counter rural attrition, the government must regularise contract doctors and expand the “You Quote, We Pay” scheme to attract them to work in these areas, it suggests.The invisible spend on medicines Many reports and studies have revealed that out of all categories of healthcare, the expenditure on medicines is the highest – despite the fact that India is recognised as the ‘pharmacy to the world’. Even the report states that medicine is the single largest identifiable component of healthcare spending. The Committee believes such compulsion of patients is a major driver of impoverishment, particularly for households managing chronic illnesses. These illnesses are those for which patients are required to take medicines for the entire course of their lives after the diagnosis.To address this problem, the Union government launched Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP) in2015. It was a refined version of a similar scheme launched in 2008 by the Manmohan Singh-government. This government, additionally, also launched Amrit Pharmacy schemes for drugs that are particularly expensive and are needed for high-end care.The committee clearly acknowledges the government’s success and notes that these two schemes have saved Rs 45,000 crore. But the physical footprint of the PMBJP scheme remains inadequate compared to the overall population’s needs, it highlights.Other than these two schemes, the public health facilities have always been mandated to provide free essential drugs. The stock-outs are often reported in them. The committee asked the government to strictly monitor the measures for ensuring the uninterrupted provision of free essential medicines across all tiers of public health facilities.To ensure the affordability of certain drugs, the government’s National Pharmaceutical Pricing Authority (NPPA) caps the prices of some drugs which fall under what is known as ‘scheduled category’. The profit margins of companies, which manufacture non-scheduled drugs, is also monitored by NPPA. The Committee, however, believes that expanding this framework is vital to combat what it calls “predatory markups” (or profits) over the actual cost of manufacturing levied by the pharma firms. It hails the “historical inclusion” of coronary stents, knee implants, condoms, and intra-uterine devices within the National List of Essential Medicines (NLEM) that resulted in regulation of their prices. According to the committee this led to protecting “millions from catastrophic medical debt, with coronary stent price caps alone generating an unprecedented Rs 13,353 crore in annual consumer savings”. The report also takes note of the fact that the country’s drug quality regulator – Central Drugs Standard Control Organisation – is marred with persistent vacancies. Often the sub-standard drugs flooding the markets make headlines. The report recommends the government to fill these posts in a time-bound manner to ensure better regulatory oversight.The traceability chain of spurious and substandard drugs has gaps. The government must ensure end-to-end traceability of pharmaceutical products and mandate strict compliance with Good Distribution Practices (GDP) across manufacturers, distributors, and retailers, the committee proposes.Elderly careMany assessments suggest India is going to be a nation of elderly citizens in about two decades from now. The senior citizens will outnumber the children. That will significantly increase India’s healthcare challenges. This report also recognises this fact and adds that the changing demographic profile necessitates an “immediate pivot” to elder care and formulation of “comprehensive policy” for this section. It recommended integration of dedicated geriatric medicine, palliative care, rehabilitation and home-based care into primary (rural) and secondary (district) levels of healthcare. Banjot Kaur is an independent health journalist.