It is to be noted that this is not a new budgetary allocation, but only a rerouting of existing expenditure, it said, adding that the 'stimulus package is lacking in addressing the immediate concerns of the healthcare system'.
Fitch Solutions has said that the latest stimulus package does not address immediate concerns of the healthcare system which is reeling under the pressure of COVID-19 pandemic. On March 11, the Ministry of Finance increased allocation – 0.008 per cent of the country’s GDP – to the health services division to support an expansion of healthcare spending, Fitch Solutions Country Risk and Industry Research (a unit of Fitch Group) said.
It is to be noted that this is not a new budgetary allocation, but only a rerouting of existing expenditure, it said, adding that the ‘stimulus package is lacking in addressing the immediate concerns of the healthcare system’.
The unprecedented crisis due to COVID-19 has highlighted the need to increase investment in the healthcare sector in the country.
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Despite several healthcare reforms, India is badly placed to tackle the rapid spread of coronavirus. The continued lack of medical funding and healthcare infrastructure suggests that the impact of further spread of the disease will be worse in India if it is not adequately contained, it said.
Moreover, the significant inefficiency, dysfunctioning and acute shortage of the healthcare delivery systems in the public sector do not match up with the growing needs of the population. The low level of public spending on health is both a cause and an exacerbating factor accounting for the poor quality, limited reach and insufficient public provisioning of healthcare, it said.
”Dealing with the COVID-19 pandemic has brought out the critical importance of the public sector in health provisioning,” Fitch added.
Rapidly declining revenues and sharply eroding profits are leading to the closure of many private hospitals.
Despite all its shortages and constraints, the public sector has had to step up to play the main role of addressing healthcare needs during this pandemic as the private hospitals have responded inadequately to the crisis, it said.
Private hospitals, which make up for two-thirds of hospital beds in India, and almost 80 per cent of available ventilators, are handling less than 10 per cent of the critical load of COVID-19 patients.
Many are not even offering non-COVID-19 healthcare services, thus leaving the burden of providing healthcare on the shoulders of public health sector, which is already strained. Only a few private providers have come forward to extend support to the government.