Authors: Rich Feely, Boston University School of Public Health Timothy Thahane, Former Minister of Finance, Kingdom of Lesotho The article by Scott…
Author: Dr. K. Rahul S Reddy, National Coordinator, Health Systems Transformation Platform, New Delhi, India
The pandemic has been an unprecedented test for the Indian health system as was for many countries across the world. The inefficiency and limitation of the existing system was exposed, presenting an opportunity for the stakeholders to ‘rethink and respond’ both in the short and long term. The National and State Governments did mount an immediate response to plug gaps related to timely prevention of transmission, treatment, and immunization. Government mobilized supplementary budgets for health sector, adjusted duties and taxes for new technology, medicines, diagnostic tests and ensured direct financial aid and food grains to the poor households. External aid in the form of loans and grants was also accepted and channeled towards augmenting service delivery infrastructure. These measures have shown some promise, given the enormity of financial and human resources mobilized and the complexity entailed in reaching the vast geography and population of India. However ineffective private sector engagement could not guarantee service provision in the private secondary and tertiary hospitals and diagnostic laboratories (due to States fixing price unilaterally or setting low prices or lack of provisions for offsetting costs of new technologies/ treatments etc.). From our own experience, newspaper articles and opinion pieces, we know this led to households paying for healthcare services during a ‘COVID-19 episode’ from income, savings, and borrowings. Coupled with loss of income due to economic disruption and burden of health payments, majority may not have received timely and appropriate treatment, especially the poor and near poor. Receiving treatment may have turned to be catastrophic for most households and pushed them into debt and poverty. Economists and public health experts believe one of India’s major disadvantages is a fragmented health financing system with overt reliance on household out-of-pocket expenditure (payments made directly at the hospital/clinic/laboratory / pharmacy etc. when healthcare services are received), which limits the Government’s ability to intervene and manage health providers and other stakeholders for rapid sector wide impact.
When we look to Thailand, a comparator in our journey towards Universal Health Coverage, we find that payments for COVID-19 health services were built into the standardized three scheme system that existed since 2002, anchored by the National Health Security Office. Each scheme covers one specific population group (civil servants, private sector formal workers, and the rest of the population) covering almost the entire population with a distinct service package, contributions, and provider payment mechanisms. Similarly, both Japan and South Korea responded through their respective National Health Insurance systems that cover almost the entire population, and all public and private sector providers under its ambit. Yearly contributions (in case of households with loss of income) and small payments to be made by households at point of service (co-payments) were reimbursed by the government directly to the insurer or the providers respectively. In addition, reimbursements were made to cover deficit incurred by the providers due to cost of new technologies for treatment/ diagnostics and incentives for health professionals.
A cohesive response in these countries was possible due to presence of an overarching authority integrating all levels of governments, institutions, and providers, considering provincial and local context emerging needs. This ensured targeted interventions and fixing standard reimbursement rates considering all influencing factors during negotiations with both private and public sector providers so that they do not differentiate for service quality or charge household’s any payments when providing the service (out of pocket payments). As we ease out of critical period of the pandemic and begin to shape the country’s long-term strategy for sustainable health sector reforms, we should consider some of these learnings to ensure social and financial protection of Indian households. As we also witness an economic crisis, these long-term reforms may take a back seat. We should all recall that a post-crisis era, provides an opportunity to make large shifts in policy. And this opportunity cannot be missed.