Published on 13 Feb 2025
In India, the private sector has been an active agent, with over 70% of the healthcare services being provided by private hospitals.
Benefits associated with privatization of healthcare
✔ Increased access to healthcare: Involvement of the private sector increases the number of healthcare services and professionals, thus increasing accessibility.
● Example: India has a total of 43000 private hospitals with 59000 ICUs, while the public sector has only 25700 hospitals with 35000 ICUs.
✔ Quality service delivery: Private hospitals have better infrastructure, are better managed and efficiently offer services. Also, more institutions can bring positive competition, thus aiding in quality improvement.
● Example: Private hospitals have close to 30000 ventilator facilities while public hospitals have only 17000.
✔ Innovation and technology: Private institutions are more inclined to invest in latest technologies and innovations, which can improve diagnostics and treatment quality.
● Example: Availability of resources and decentralized management aids private hospitals to incorporate technologies like AI, telemedicine, IoT etc.
✔ Reduce burden on government: An active engagement from private healthcare can reduce the burden on the government to provide quality healthcare to the people.
● Example: According to the Economic Survey of India 2022-23, the combined expenditure of centre and state on healthcare is only 2.1% of GDP, which is comparatively low.
✔ Medical tourism: India is an attractive destination for medical tourism and private healthcare plays an important role in providing quality services to the foreigners.
● Example: The role of NABH-accredited private hospitals has been crucial for developing Chennai as a medical hub with more than 6 lakh medical tourists visiting every year.
✔ Employment opportunity and growth: More healthcare institutions can provide more healthcare jobs. This can bring down brain drain and aid in economic growth.
Issues associated with increased privatization of healthcare
✔ Affordability: Privately-run hospitals charge high fees for their service, making them less affordable for a significant proportion of the population.
● Example: Per day hospitalization costs around 2800 in public hospitals, while it is around 6700 in private hospitals.
✔ Inequitable regional distribution: Private hospitals tend to be concentrated in urban areas, thus denying equitable healthcare access to marginal rural people.
✔ Disparity in healthcare: The profit driven private health care denies equitable delivery of services to rich and poor. Thus, economic inequality transforms into inequality in health access.
● Example: Private hospitals have been less accessible to BPL families as the facilities at these hospitals are costlier than the public facilities.
✔ Lack of standardization: Since private hospitals operate independently, there is lack of uniformity regarding treatment protocols, pricing and service quality.
✔ Regulatory challenges: Private health sectors are less accountable and the lax regulations can lead to overcharging, unethical attention to patient safety standards etc.
● Example: WHO in its recent report has highlighted the lack of proper regulation of private hospitals in India.
✔ Limited focus on non-lucrative specialities: Private hospitals may prioritize lucrative specialities over essential services, as the former yields more profit. Thus, primary care, mental health etc. are largely neglected.
What changes need to be brought about in private health care
✔ Transparency in pricing: Ensure standardized and transparent pricing for medical services to reduce events of patients getting manipulated.
✔ Regulation and accreditation: To ensure quality standards at the hospitals and to improve their service delivery.
✔ Promote preventive health: Private hospitals need to focus more on the social aspect, by investing in preventive health to reduce disease burden.
✔ Collaboration with public hospitals: Private institutions can transfer better innovations to public hospitals and be a part of government-led health initiatives.
Private sector has a crucial role in developing a healthy India. But these institutions need to be well-regulated with proper standardization norms to ensure that the benefits of these institutions are fairly distributed across the society.
Social Justice
Privatization
Medical tourism
Healthcare in India
General Studies Paper 2
Social Justice
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