The answer to our justified fears of private monopoly cannot be a government monopoly

Failed state of healthcare Odishas helpless husband and why govt alone cannot succeedImage: OTV
Voices Blog Thursday, September 01, 2016 - 17:06

On August 24, Dana Majhi, a resident of Kalahandi in Odisha, gave up on the system in frustration. Having been denied a mortuary van by the government-run hospital, Majhi lifted the body of his dead wife and started walking to his village, which was 60kms away. The images of his helpless walk, with his daughter in tow, shocked the nation, and also led to laments about the lack of basic health infrastructure in the country.

Why the laments ring hollow though, is that we still refuse to acknowledge the root of the problem. No doubt, Majhi’s wife was denied dignity in death due to the family’s poverty. But even if every poor person in the country was given the money to access basic healthcare, they would not get it, because there simply isn’t enough of it.

The healthcare divide between the haves and have-nots is because the country does not have enough of it to begin with. There is a huge supply-demand mismatch and the government is simply failing to create the capacity.

An IndiaSpend report points out that according to WHO data, India is short of nearly 500,000 doctors. The report further states that there is an “83% shortage of specialist medical professionals in community health centres (CHCs)”, and “Public-health centres across India’s rural areas –25,308 in 29 states and seven union territories – are short of more than 3,000 doctors, the scarcity rising 200% (or tripling) over 10 years”.

Even that data is questioned by a Parliamentary committee, which states, “the Committee feels that the total universe of doctors in India is much smaller than the official figure, and we may have one doctor per 2,000 population, if not more.”

But in a complete misunderstanding of the problem, IndiaSpend quickly goes on to shift the problem to medical admissions and conveniently blames private colleges. This of course is the symptomatic of the larger discourse on healthcare in India – private is evil, public is good.

In the policy debates between left and right and private and public, the real problem of lack of capacity is lost in polemics. Yes, the cost of healthcare is increasing, and out of pocket health expenses in India are among the highest globally, but that’s what happens when supply does not match high demand.

We have all seen the massive failure of the government to take affordable healthcare to the poor. Even if healthcare budgets are increased significantly, systemic issues like inefficiency and lack of accountability will continue to ensure that the system underperforms and more poor people die.

In Majhi’s own case, the reporter who spotted him informed district officials about his situation, and yet officials could not help him. Later, an NGO provided the van, and a private businessman paid for the fuel. If the state cannot increase capacity, why not allow the private sector to open up?

The response to this is often on these lines - one, healthcare cannot be a business; two, private hospitals are all evil cheaters; and three, government will lose space to the private sector which will eventually take over the sector and hike up prices. None of this is true or has to necessarily be the case.

What we need essentially is to change our perspective on what ‘private’ means. Private medical professionals aren’t just big corporate hospitals and expensive urban clinics. There are umpteen private medical professionals in low-income settings. In urban slums and distant hills, doctors and paramedics have set up clinics with lean business models, all catering to the poor.

There is a tendency to dismiss all of them as inept or quacks. What does research show?

A study by Karthik Muralidhran and others on relative quality of public and private healthcare in a low income setting reported three main findings:

“First, most private providers lacked formal medical training, but they spent more time with patients and completed more essential checklist items than public providers, and were equally likely to provide a correct treatment.

Second, we compare the performance of qualified public doctors across their public and private practices, and find that the same doctors exerted higher effort and were more likely to provide a correct treatment in their private practices.

Third, in the private sector, we find that prices charged are positively correlated with provider effort and correct treatment, but also with unnecessary treatments. In the public sector, we find no correlation between provider salaries and any measure of quality.”

These are not big rich hospitals, but small doctors in low-income settings catering to the poor. And what stops more of them from operating? Government policy.

As Muralidharan and others state, “Current policy thinking often points in the opposite direction, with a focus on hiring, training, and capacity building in the public sector on one hand (without much attention to their incentives for effort), and considerable resistance to training and providing legitimacy to unqualified private providers on the other (Reddy et al., 2011; Shiva Kumar et al., 2011; Planning Commission of India, 2013).”

This is not to say that the private sector is without problems, or that the market can be the panacea to India’s healthcare woes. However, aren’t there problems with government hospitals?

But in our justified battle to rein in unwieldy corporates who operate with sheer greed, we are losing the potential to capitalize on smaller private entities which can increase our healthcare capacity much faster than the government and at reasonable costs.

Dr. Devi Shetty’s Narayana Healthcare is a great example of how private healthcare, with the right business model, can be made affordable. And as Dr. Shetty says, it cannot be done through charity because charity is not scalable. Good business principles are, and there are more Dr. Shettys available who want to make money while providing affordable healthcare. And what stops them is the red tape.

Today, after witnessing Majhi’s tragedy, an intelligent person in Kalahandi could start a small-scale mortuary van service that caters to the poor, figure out a business model in which he makes money and could even offer some free rides. But that would be evil because he is ‘private’ and not ‘authorized’. We want him to suffer through our licensing system, deal with corrupt bureaucrats and absurd regulations which will eventually discourage him from doing any good.

Dr Devi Shetty or a Kalahandi man cannot replace the government, but why are we not encouraging more of them? Private sector need not and should not replace public healthcare which caters to the poor, but it could very well augment our efforts to provide universal coverage. And for that, we have to move beyond our orthodox thinking that the private sector is evil.

Note: The views expressed here are the personal opinions of the author.

 

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