By Surjeet Thakur
As we approach the Union Budget 2025, many of us are keen to understand how the proposed financial plans might influence our daily lives, particularly concerning healthcare expenses. The government’s fiscal policies play a pivotal role in determining the accessibility and affordability of medical services. Let’s delve into the potential implications of the upcoming budget on your medical bills and the broader healthcare landscape in India.
In recent years, the Indian government has shown a commitment to bolstering the healthcare sector. For instance, in the Union Budget 2024-25, the health ministry was allocated ₹90,958.63 crore, marking a 12.96% increase over the previous year’s revised estimates. This boost aimed to strengthen public healthcare infrastructure and improve access to essential medical services across the country. Notably, the budget also exempted customs duties on three cancer treatment drugs—Trastuzumab Deruxtecan, Osimertinib, and Durvalumab—to make critical treatments more affordable.
Building on this momentum, the pharmaceutical and healthcare industries are advocating for further enhancements in the upcoming budget. A report by CareEdge Ratings highlights the sector’s call for a 2.5% to 3% increase in healthcare budget allocation compared to last year. The emphasis is on enhancing healthcare infrastructure, especially in rural and semi-urban areas, where access to quality medical services remains a challenge. Strengthening these facilities could lead to earlier diagnoses and interventions, potentially reducing the need for more expensive treatments down the line.
Innovation is another critical area where the industry seeks support. There’s a push for the re-introduction of weighted average tax benefits for research and development (R&D) in the pharmaceutical sector. This incentive, previously available, is expected to spur innovation and development in critical therapeutic areas. By fostering a robust R&D environment, the industry aims to develop more effective and affordable treatments, which could eventually lower the cost of medications for patients.
Affordability of healthcare services and insurance is a pressing concern for many. Currently, health insurance premiums attract an 18% Goods and Services Tax (GST). The industry recommends reducing this rate and increasing the deduction limit for health insurance premiums under Section 80D of the Income Tax Act. If these suggestions are implemented, out-of-pocket expenses for health insurance could decrease, making it more accessible to a broader segment of the population.
Domestic manufacturing of pharmaceutical products and medical devices is another focal point. The industry suggests increasing the budget allocation for the Production Linked Incentive (PLI) scheme to drive domestic manufacturing. Strengthening local production could lead to reduced costs for these items, as reliance on imports diminishes. Additionally, reducing customs duties on life-saving drugs is a key recommendation. If the government heeds this advice, we could see a decrease in the prices of essential medications, making treatments for critical conditions more affordable.
Looking ahead, the Union Budget 2025 holds the potential for significant changes in the healthcare landscape. By focusing on increased funding, tax incentives, and support for domestic manufacturing, the government aims to make healthcare more accessible and affordable for all. It’s essential to stay informed and understand how the final budget decisions will impact your healthcare expenses. By keeping abreast of these developments, you can better plan for your medical needs and take advantage of any new benefits that may arise. In a nutshell, the upcoming Union Budget presents an opportunity for the government to address key issues in the healthcare sector. The proposed measures, if implemented, could lead to improved infrastructure, foster innovation, and make healthcare services and insurance more affordable. As citizens, staying informed about these developments will enable us to navigate the evolving healthcare landscape more effectively and make informed decisions about our medical needs.
(The author is CIO at Rajagiri Hospital, Kochi and Founder & CEO of TrioTree Technologies. Views expressed are the author’s own and not necessarily those of financialexpress.com.)