While, undoubtedly, public investment in healthcare must increase, the government must also accept the presence of the private sector and formulate policies to minimise distortions, former Union Health Secretary Sujatha Rao has said. 


Essential to this plan is increasing substantially public investment to provide universal access to basic care. At the same time, it is important for the government to play the role of a price stabiliser. This would involve setting standards — quality assurance, accreditation, and certification for which minimum standards must be in place.

Laws must also be put in place to enforce these criteria, Dr. Rao said.

She was delivering a lecture on ‘Public Health Financing' organised by CHARTERED, Voluntary Health Services, Chennai. Dr. Rao's roadmap for the future included an ability to negotiate prices (essentially with the private sector) and a focus on preventive services by establishing strong public health personnel tasked with spreading health information.

The latter point should be made mandatory for the private sector as well, she said. As for resource mobilisation, effective means of doing so would involve extensive computerisation, and manpower to assess and regulate.

New forms of taxation

She also suggested that new forms of taxation be levied to up health budgets.

For instance, about 10 per cent tax could be levied on medical tourists in order to generate resources for funding public facilities.

There are approximately 10 lakh foreign patients coming to the country for procedures, and this is projected to grow annually at 30-40 per cent.

However, the most important thing for the government would be to ensure effective spending of every rupee spent.

Public sector funding is mainly tax-based, with less than 10 per cent coming from user fees, donor-funding and insurance, she said.

Girija Vaidyanathan, Mission Director, NRHM, moderated the question-and-answer session that followed. S.Vijayakumar, project director, Tamil Nadu Health Systems Project, and Bimal Charles, director, APAC-VHS, also spoke.