The NITI Aayog has recently unveiled a grand plan to effectively privatise district hospitals in Tier-I and Tier-II towns. It has developed what it calls a “model concessionaire agreement” for provision of healthcare services for cardiac and pulmonary (lung) diseases and cancers. It is proposed that public facilities in district hospitals would be outsourced to private providers. They would be free to charge full treatment costs from patients not covered by government schemes (such as the Rashtriya Swasthya Bima Yojana) and the providers would be reimbursed by the government for treating patients referred by the government
Private providers will be able to cherry-pick the most lucrative districts where patients have a higher paying capacity. The scheme also provides for an escrow account that would offset the risk to private providers posed by possible delays in reimbursement by the government. Providers would also secure access to public facilities such as ambulance services, blood banks and mortuaries. Clearly no effort has been spared to roll out the red carpet and ensure that private companies are able to freeload on public assets.
What are the implications for accessible healthcare services? First, the proposal implies that most patients would have to pay for care even in public facilities. The promise that patients covered by government health insurance schemes would access care free of cost needs to be seen in the context of recent surveys which show that just 12-13% of people are covered by public-funded insurance.
Second, the proposal is designed to further worsen inequity in access to healthcare services. Private providers will concentrate on better-off districts, leaving the poor and remote districts for the public sector to manage. This will further weaken the ability of public hospitals to attract and retain trained doctors and other health workers.
Third, the scheme will expose thousands of patients to unethical practices by private providers, compromises in quality and rationality of services and additional ‘top-up services’. A specific section in the document on ‘risk management’ is primarily concerned about risks of private providers, with very little about robust mechanisms to protect patients from unethical practices.
Fourth, outsourcing of hospital care to private providers inevitably becomes increasingly unsustainable over time as they ratchet up demands on reimbursements and fees. The proposal to hive off hospital care to the private sector is justified by the argument that public services are not financed adequately and face an acute shortage of trained human resources.
The simple remedy could be to significantly enhance investment in public healthcare services, including in the training of health workers. The government’s singular resistance to follow such a path is linked to its ideological moorings, which find virtue in private enterprise and view public services as inherently inefficient. This scepticism regarding public services needs to be tempered by the experience that success stories of public health, in diverse settings such as the U.K., France, Cuba, Thailand and Sri Lanka, are all related to public systems.
The NITI Aayog’s proposal involves the handing over of public assets to for-profit companies, and represents a clear abdication of duty by the government. The NITI Aayog describes itself as a ‘think tank’, unlike the Planning Commission of yore.
It is understood that the scheme will be piloted in a couple of districts, presumably in Bharatiya Janata Party-governed States. Health care is primarily a State subject and State governments must first question the legitimacy of a supposed think tank to pronounce public policy.