Should health care be in the private sector? This is certainly a provocative statement. My answer is? public sector should dominate leaving private sector to those who can afford or want to exercise a choice at their cost. This means health care should be rationed in the society not by prices as happens in the private sector. But by Physicians based on their assessment of need of patients and without a profit motive as happens in the public sector. I have strong reasons to hold this view.
I feel the biggest health policy mistake committed in India after independence was to allow private medicine as the pre-dominant mode of health care delivery. This has caused enormous increase in health care costs without commensurate health benefits to the population. My argument is based on World Health report 2004.
A painful review on Esc*rts Hospitals by one of the MS members?vs2004?, who lost his father, provoked me to write this review.
Health Care is not a Commodity or a Service? It is Life Giver:
Health care has a lot of peculiarities that are not seen in other services that people generally use. Among these, consumer ignorance is the most important. Health care is possibly the only services where the producer(doctor) directs the consumer(patient) as to what to consume, how much to consume, when to consume, and how to consume.
In other words, the use of health care by a patient is directed by a doctor. Now, would you like any producer who has such a power on the consumer to be in the private sector so that he could make profit from consumer ignorance? I hope not. Hence markets fail to yield socially desirable outcomes in the health sector.
The Hippocratic Oath is one such instrument used by the Western civilization to discourage profit motive in the health sector. I was told that all medical doctors in India take this oath before taking their degree.
Where Public Sector Predominates? Health Outcomes are Better at Less Cost:
Whatever people spend on health care becomes the income of the medical care sector including drug companies. This being so consumer ignorance, in the absence of strong regulation and controls on health care providers, leads to provision of un-necessary care and even profiteering leading to high health care costs.
To overcome this problem and to protect consumers, most of the developed market economies in the west have strong public controls on health care providers. Generally, this is accomplished by the presence of a large public sector in health care services / health care financing.
The objective of most western capitalist societies, which we try to ape, is to minimize the cost of health care. Generally health care costs in a society are minimized if either financing or provision of health care is centralized. Such centralization is possible only when health care provision/financing is provided predominantly through the public sector.
Let me prove this argument using the following WHO information for six countries three developed and three developing. For each country we present the Health care cost as% of national income, the share of public sector, and Health years of life in that order.
[USA 13.9% of GDP; 44% public; 69 years]
[Briton 7.6% of GDP;82% public; 71 years]-
[France 9.6% of GDP; 76% public; 72 years]?
[ India 5.1% of GDP; 18% public; 53 years]-
[China 5.5%of GDP; 40%public; 64 years]-
[Sri Lanka 3.6% of GDP; 49% public; 62 years]
The above WHO data for 2001 shows that the US spent the highest among the developed countries on health care(13.9% of their national income) and mostly through private sector(56% of total expenditure) yet achieved a lower health status of only 69 health years of life to an average person(when compared to other western countries).
Whereas Briton(the UK) spent only 7.6% of its national income on health mostly through the public sector(82% of total expenditure) and has better health outcome(71 healthy years of life) compared to the US.
Among developing countries, India spent more than many countries as percent of national income(5.1%) but has very poor health status(53 years of healthy life) mainly because we have a large private sector which inflates costs but ineffective in providing care to the population at large.
Sri Lanka spends less of their national income than us(3.6%) but has better health status(63 healthy life years).
In China too the health status is much better though they spend only slightly more on health care. Both these countries have much smaller private sector than India. Besides it should be noted that private health care in China should be understood as private payments to providers and not as private sector provision of health care as is the case in India.
We Missed the Bus? the Bhore Committee 1946 - Ignored:
We had a chance to create a solid publicly funded health care system in India. The Bhore Committee recommended in 1946 a type of health care system for India that would have given primacy to the public sector. We would have had a 2, 500 bedded hospital in each district, a 650 bedded hospital in each block, and a 75 bed hospital for 10, 000 population in rural areas.
A system like that would have removed congestion in public hospitals as we see now, which is the main reason for poor health care and staff rudeness in Government hospitals. Implementation of Bhore Committee recommendations would also have largely obliterated the need for a large private sector presence in health care in India.
The Bhore Committee estimated that its recommendations could be implemented if 15% of public spending is made on health care(less than 4% of national income). We would have had one hospital bed for 176 people. At present, even after spending over 5% of our national income on health(mostly through the private sector) we have only one hospital bed for over 1000 persons!
But after independence, the recommendations of the Bhore Committee were not accepted ostensibly for the reason that Government cannot afford such a system. What was ignored at that time was that implementing Bhore Committee recommendations would have cost more to the Government but less to the society! Health outcomes would have been much better and would have reduced our population growth rate considerably as well.
The real reason why the Bhore Committee recommendations were not accepted was, because the private medicine and doctors in general lobbied for its rejection fearing loss of income. Private health care only benefits the medical profession at the cost of the society. Health sector is a classic case where India privatized at a heavy cost to the society. As indicated above, even in hard-core capitalist countries a large part of the health sector is still controlled by the public sector, and for very good reasons.
Can we Change the System:
Well I think it is very difficult? may be almost impossible. The only country that has been able to change the medical system from the private to a publicly funded one is Canada? it took about 40 years to achieve it even after the political leadership strongly pushed for it. I am citing Canadian experience to indicate how difficult it is to change the system at this stage. Perhaps we should try to prevent what happened to one of our fellow members. It may take a long time, but the beginning is always made with the first step.