Union Budget 2023: As COVID-19 cases are rising again and ahead of the upcoming union budget, experts from the healthcare industry are expecting several steps and measures to improve access to quality care and treatment.
During the coronavirus pandemic, the health capital was tested not just at an individual level but also at a societal level.
Several industry experts told Financial Express.com that there has been a long-standing demand for increasing government health expenditure on health as a percentage of GDP. According to the latest National Health Accounts Report, it has been stagnant at around 1.2-1.3 percent.
India needs to build a robust and resilient healthcare system
According to Dheeraj Jain, Founder & MD, Redcliffe Labs, healthcare is under-served and under-consumed. India requires a plan to build a robust and resilient healthcare system, which can only be done by increasing investment (both public and private), he told Financial Express.com.
“Turning to preventive care is the need of the hour. Despite the fact that it can significantly lower medical costs and detect life-threatening health conditions early, it is undervalued. Therefore, improving testing facilities or diagnostic services in Rural Bharat needs to be of the utmost importance. Additionally, the GST for the healthcare industry needs to be rationalised so that the businesses in the sector may attract more investment and provide services to customers at affordable rates,” Jain added.
Furthermore, healthcare services in tier II and tier III cities need to be strengthened, especially when it comes to hospital facilities, which might be explored using a PPP model.
Jain also emphasised that the budget should include a strategy for increasing the availability of healthcare professionals, particularly in Tier 2/3 and 4 towns.
“The forthcoming budget should also focus on healthcare digitisation because it is a fundamental precondition for providing value-based care throughout India’s healthcare continuum. In India’s Tier II and III cities, in particular, adopting intelligent solutions can help decrease barriers between hospitals and patients, improving access to care and raising overall patient satisfaction,” Jain told Financial Express.com.
Some public health experts have also pointed out that India needs targeted investments in government programmes that focus on addressing the unmet need of marginalised populations and geographies — greater investments in health, nutrition, education, professional skills and employment opportunities.
Need for strong public health system
“While the annual budget will be a step forward in accomplishing national goals, it is hoped that this budget will also propose measures along with adequate budgetary allocation to deal with the fall-out of the COVID-19 pandemic and strengthening of the public health system. Over the past two decades, India’s achievements in the economic spheres and family planning have been impressive,” public health expert Poonam Muttreja told Financial Express.com.
Muttreja also emphasised that higher budgetary allocations for sexual and reproductive health and family planning programmes under the National Health Mission and an increase in the budget for family welfare to ensure adequate supply of contraceptives methods for spacing births and LARCs to meet reproductive health needs, especially of young people should be implemented.
“Greater investments in gender equality initiatives and social and behaviour change communication programmes will help address the social determinants of health,” she added.
Some experts also emphasised on the need to address the shortage of healthcare professionals.
“India is amongst the most preferred destinations globally for medical tourism and therefore, increased policy support is required to encourage, facilitate medical value travel to India, and develop MVT as an organized sector. Another critical area is addressing the shortage of healthcare professionals,” Dr. Ashutosh Raghuvanshi, Senior Vice President, NATHEALTH and MD & CEO, Fortis Healthcare
Tax incentives for new healthcare projects
The expert also highlighted the sector needs lower-cost financing through tax incentives for both existing and new healthcare projects.
“For new projects, the Government should provide a tax holiday period of 15 years and for existing projects, tax relief for 10 years as re-investment support. Declaring healthcare as a National Priority Sector and classifying it on the same lines as Agriculture (priority-sector lending), will give banks the flexibility to lend to private healthcare institutions, on longer tenures, at lower rates,” Dr. Raghuvanshi said.
According to Shravan Subramanyam, President, NATHEALTH, viability gap funding by the Government is essential to set up hospitals in tier-1 and tier-2 cities, encouraging increased investment in the healthcare infrastructure.
“It is imperative to build infrastructural capabilities so that people have greater access to quality and critical healthcare services. Viability gap funding by the Government is essential to set up hospitals in tier-1 and tier-2 cities, encouraging increased investment in the healthcare infrastructure. Uniform adoption of the Ayushman Bharat Digital Mission is another imperative which calls for clearly defined delivery models for innovative modules developed by private players. We are also witnessing a significant impact on the cost of running a business which will affect the sustainability of MedTech organizations,” Subramanyan told Financial Express.com.
He also maintained that if all payment backlogs both for providers and suppliers under insurance and public procurement are cleared, it would significantly improve the availability of healthcare infrastructure.
In December 2022, NATHEALTH – Healthcare Federation of India submitted a comprehensive set of recommendations to the Government for the Union Budget 2023-24, with the prime objective of addressing the current barriers for the private healthcare sector.
GST Reforms, unutilised past MAT credit while transitioning to a new income tax regime, health financing and budgetary allocation for clearing past dues under CGHS and ECHS were some of NATHEALTH’s key recommendations. NATHEALTH further emphasized that the budget allocation for health should be substantially increased to 2.5% of GDP in line with the Government’s own stated intent to spend 2.5 percent of GDP on healthcare by 2025.