Poor Funding, Trend Towards Private Sector Widens Public Health Gap

Poor Funding, Trend Towards Private Sector Widens Health Gap

The poor funding in public health care system and the trend towards supporting the growth of private sector worsened the health infrastructure and widened the gap of inequalities in the system. The situation again worsened with the disastrous Covid-19 pandemic, according to a report by Oxfam India.

In the report “Inequality Report 2021: India’s Unequal Healthcare Story”, Oxfam India showed that the general category performed better than Scheduled Castes (SC) and Scheduled Tribes (ST). It also said that the Hindus perform better than Muslims do; the rich perform better than the poor do; men are better off than women are; and urban population is better off than the rural population on various health indicators.


The report attributed the poor provisioning of public healthcare to consistently low budget allocations. It said that the current expenditure on health by the centre and the state governments combined is only about 1.25 percent of GDP. India’s expenditure is the lowest among the BRICS countries. Of the BRICS countries, Brazil has the highest allocation of 9.2 per cent. South Africa follows with 8.1 per cent, Russia 5.3 per cent and China 5.22 per cent. India’s expenditure is also lower than the neighbouring countries like Bhutan (2.5 percent) and Sri Lanka (1.6 percent).

Despite India has made progress in healthcare, the country’s trend has been towards supporting the growth of the private sector in healthcare. “This growth has only exacerbated the existing inequalities leaving the poor and the marginalised with no viable healthcare provisions,” the report read.

The Oxfam report pointed out that high costs of health services and lack of quality led to further impoverishment of the disadvantaged. It said that present health care system in the country will worsen the inequalities and will be detriment to the poor and the marginalised if the fundamentals of healthcare system in India are not addressed.


The report points out that only around 50,069 Health and Wellness Centres (HWCs), which are envisaged to deliver comprehensive primary healthcare (CPHC) closer to homes, are functional. These centres form only 65 percent of the cumulative target for 2020-21. The report said that less than 10 percent of PHCs were funded as per IPHS norms in 2019.


The out of pocket health expenditure in India is 64.2 percent, which is much higher than the world average of 18.2 percent. It mentions that over 63 million people in India are pushed to poverty every year due to health costs alone. The Oxfam quotes a study to show that around 74 percent of hospitalization cases are financed through savings while 20 percent of the cases are financed through borrowing.

In rural areas, the main source of healthcare financing continues to be selling of household assets and mortgaging ornaments to borrow at high interest rates, followed by income/ savings.


The report said that Muslims have lower female literacy rate, lower institutional births, high fertility rate and poor nutrition than the general category. Similarly, SC and STs perform poorly than the general category in female literacy, sanitation, immunization, and nutrition.


The report pointed to an increase in Female literacy rate. However, it said that the share of women enrolled in educational institutions decreases as one moves to higher levels of education. In the general category, the literacy rate for women was 18.6 percent higher than SC women and 27.9 percent higher than ST women.


Two out of three households have access to improved, non-shared sanitation facilities in the general category, the Oxfam said in the report. Meanwhile, SC households are 28.5 percent behind them, and ST are 39.8 percent behind them. While 93.4 percent of households in the top 20 percent have access to improved sanitation, only six percent have access in the bottom 20 percent, a difference of 87.4 percent.


In the report, about 12.6 per cent more children are stunted in SC households than those in general category. The chances of a child dying before his fifth birthday are three times higher for the bottom 20 per cent of the population as compared to the top 20 per cent.

The report also noted that the rate of female child immunization continued to be below that of the male child immunization.  The Immunization of SCs and STs is behind that of other caste groups, the report added.

In the report, the Oxfam said that more than 50 percent of children still do not receive food supplements in the country. The percentage of mothers who have received full antenatal care has declined from 37 percent in 2005- 06 to 21 percent in 2015-16. Full antenatal care for urban areas is close to two times that of rural areas.


The report mentioned that the rich, on an average, lives seven and a half years more than the poor do. Similarly, a woman from the general category lives 15 years longer than a Dalit woman.

Dalits, Adivasis and OBCs have higher infant mortality rate (IMR) as compared to the general category. IMR for Adivasis is 44.4, which is 40 per cent more than the general category, and 10 per cent more than the national average, showed the report.

Oxfam India CEO Amitabh Behar said that persistent underfunding of public health systems, especially primary health care and inadequate health infrastructure in India remain to be addressed by the government even after devastating second wave. “Otherwise, health emergencies will only aggravate existing inequalities and work as a detriment for the poor and the marginalised. Declaring health as a constitutional right can help to bridge these gaps,” the CEO said.

  • The right to health should be enacted as a fundamental right that makes it obligatory for the government to ensure equal access to timely, acceptable, and affordable healthcare of appropriate quality and address the underlying determinants of health
  • Free vaccine policy should adopt an inclusive model to ensure that everyone, irrespective of their gender, caste, religion or location gets the vaccine without any delay.
  • Increase health spending to 2.5 percent of Gross Domestic Product (GDP) to ensure a more equitable health system in the country; ensure that union budgetary allocation in health for SCs and STs is proportionate to their population; prioritize primary health by ensuring that two-thirds of the health budget is allocated for strengthening primary healthcare; state governments to allocate their expenditure on health to 2.5 percent of Gross State Domestic Product (GSDP); the centre should extend financial support to the states with low per capita health expenditure to reduce inter-state inequality in health.
  • Regions with higher concentration of marginalised population should be identified and public health facilities established, equipped and made fully functional as per the Indian Public Health Standards (IPHS).
  • Widen the ambit of insurance schemes to include outpatient care. The major expenditures on health happen through outpatient costs as consultations, diagnostic tests and medicines.
  • Institutionalize a centrally sponsored scheme that earmarks funds for the provision of free essential drugs and diagnostics at all public health facilities.
  • Direct all states to notify the Patients’ Rights Charter and to set up operational mechanisms to make these rights functional and enforceable by law.
  • Regulate the private health sector by ensuring that all state governments adopt and effectively implement Clinical Establishments Act or equivalent state legislation; extend the price capping policy introduced during the COVID-19 pandemic to include diagnostics and non-COVID treatment in order to prevent exorbitant charging by private hospitals and reduce catastrophic out-of-pocket health expenditure.
  • Augment and strengthen human resources and infrastructure in the healthcare system by regularising services of women frontline health workers especially Accredited Social Health Activists (ASHAs)
  • Establish government medical colleges with district hospitals prioritising their establishment in hilly, tribal, rural and other hard-to-reach areas, enhancing medical infrastructure and establishing contingency plans for scenarios such as the second wave of the pandemic.
  • Inter-sectoral coordination for public health should be boosted to address issues of water and sanitation, literacy, etc. that contribute to health conditions. Specific roles and Statement of Purposes (SoPs) of departments/ ministries, and convergence plans need to be detailed out for reducing health inequality in the country.


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