Every year in India, around 36 million families (14% of households) experience an unexpected medical situation for which treatment costs as much as the entire annual living expenses of just one individual from that family. In some of the poorest demographics, annual wage is less than $2,000 USD.
With fewer than 1 million registered doctors and less than 15,000 state hospitals left to cover India’s population of over 1.3 billion as of last year, many Indians have no other option than to seek treatment in private healthcare centers which they cannot afford, as public hospitals are few in number, underfunded, and understaffed. As of right now, India spends only 1% of its GDP on public health- hardly a fair percentage for such a large population with such a drastic variation in income. For reference, the average per-person total spending on healthcare averaged $267 in 2014 compared to $9,403 in the United States, according to the World Bank.
Last year, Indian Prime Minister Narendra Modi proposed a solution, and now, just months before elections, has launched what is supposed to be the world’s largest healthcare program in the world, dubbed “Modicare”. Modicare promises free healthcare coverage for 500 million (around 100 million families) of the poorest citizens in India, including hospital treatment costs of up to 500,000 rupees ($7,800 USD) per year. Eligible patients can attend any healthcare institution, public or private, that has joined the scheme. The government also plans to give this access to patients in the rural population with the establishment of 150,000 “health and wellness centers” in a separate, but related program.
Healthcare is to India what Immigration is to the United States as far as politics go. With Modi up for re-election, it makes sense that he would make such a large move on a highly-debated topic, and the plan itself is not without the welfare of India in mind. However, the logistics of both programs- Modicare and Health and Wellness Centers- do not add up. Modi has allocated the equivalent of $190 million USD to the creation of these centers in rural India, but, in reality, they already exist. Previous governments have tried establishing village clinics, only for them to be defunct or underused. The sheer magnitude of the plan leaves some to wonder whether Modicare is an empty promise made in time to boost the polls in favor of Modi come April.
Even larger of a problem is Modicare itself. If the program is used to its full capacity, it would cost a whopping $780 billion, a crippling sum for India’s $2.4 trillion economy. “I’m skeptical because I don’t think enough thought is given to recruitment and training, the institutional mechanisms to ensure that you have the right workers. There’s also a massive change in the quality of care. What we do know about India’s public health system is that the quality of care provided is questionable,” Yamini Aiyar, president and chief of the Delhi-based Center for Policy research think tank, told CNN.
According to a study at Capital Economics, Modicare is likely to be highly limited or generally unsuccessful due to the financial restrictions on the Indian government’s healthcare provision. Four states- Telangana, Odisha, Kerala, and Punjab- as well as the union territory of Delhi have chosen not to participate in Modicare, citing concerns over infrastructure, issues in funding, and the potential for the program to become corrupt. With the launch of both programs this month, only time will tell to what capacity Modicare can be a benefit- or a detriment- to the Indian people.
First published in print by The Stillman Exchange on October 6, 2018.
