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Medical Debt is a major cause of poverty in India

Medical Debt is a major cause of poverty in India

Dr. R.Kumar

President Society for Prevention of Ethical and Affordable health Care

About 55 million Indians were pushed into poverty in a single year due to patient care costs, as per a study by Public health foundation of India. Why? Lack of affordable hospitals, missing doctors, ill-equipped health professionals, fake and expensive drugs, antibiotic resistance, childhood malnutrition, neglect of women health and paucity of funds; all have been dogging the Indian health sector. Rising cost of treatment especially in corporate hospitals is making the life of the citizens difficult. People dread falling sick, for fear of debt trap! In many situations cost of medicines, devices, tests and interventions is so high and unessential that it is a sheer wastage of resources. Leveraging doctors’ online communities through micro-sites of the pharmaceuticals is a new mode of deceit by these companies.   Mercifully, significant share of India’s population seem to avoid the formal medical system, lest they face a debilitating financial burden. Many families opt not to go for any treatment even when a member faces a life-threatening disease- staggering 39% do not receive any medical attention before death. Rich person may identify a relatively minor indisposition as ailment and go for treatment, while the poor might perceive an ailment only when it is work-disabling or life threatening.  Will Ayushman Bharat (AB) scheme assuage the anxieties of Indian people? The fact remains that the public hospitals are crumbling under excessive patient-load coupled with lack of resources. Even public health budget remains pegged around 1% of GDP, in spite of promises to raise it to 2.5%. People are forced to bank on corporate hospitals, though the ability of most patients to pay is limited.  

Health care financing and Medical debt

Earlier medical debt was a narrative of American patient-care, but now developing countries like India are deeply immersed into it!  One of the major reasons why India's poor incur debt is the cost of healthcare, which has risen disproportionate to incomes.  Another is wasting life time earnings or selling assets to pay for end of life situations, where chances of survival are minimal. Less than 15% of the population in India today has any kind of health-care cover, be it community insurance, employers’ expenditure, social insurance etc. The then President Pranab Mukherjee drew attention to the healthcare emergency India faces -- as 80 percent of costs are paid out-of-pocket and healthcare debts plunge 4-6 crore Indians into poverty every year.  Causes of poverty are obvious across the globe  i) loss of income with the death of earning member ii) High cost of treatment before death.  Americans borrowed an estimated $88 billion to cover health care costs in 2018; many had to go for bankruptcy eventually. More than 36% have no insurance of any kind, many more have skimpier health-insurance plans. These plans may require patients to pay thousands of dollars before insurance kicks in.  Even the insured often can’t afford to pay their medical bills in US.  Many physicians indulge in unethical practices to supplement the dwindling earnings from profession.  Will India’s AB be able to save the people from poverty? "It is like a leaking bucket. Though a lot of effort is being put to bring people out of poverty, due to health expenses," said Dr. Indu Bhushan CEO of National health authority.

Do the corporate hospitals really fleece the patients?

Decades ago, healthcare was only provided by Government and trust hospitals with the aim of charity. It was with the establishment of corporate like Apollo that healthcare started paying attention to profit margins. Corporate hospitals are built with large capital investments, which mean higher cost of treatments. While there is some truth in the allegations of arbitrary overbilling, the hospitals’ version of high capital cost is also true. Surprisingly, these hospitals are battling poor financial health. Four of India’s large publicly traded hospital chains — Apollo , Narayan Health, Fortis and Max India— have cumulatively lost `6,300 crores in the last two years. Recent reports suggest transfer of ownership of Fortis, Max, Medanta and others to foreign hands. Will this augur well for affordability to native patients?

As the costs are rising and hospital chains are losing their grasp over pricing, with healthcare costs being capped due to political reasons. There is a need to fix fair prices of medical services. Comparison with government hospitals is problematic as several cost components are subsidized in public sector, such as land or buildings. Thus, without addressing the issue of pricing, the AB scheme—announced in the union budget in February 2019 with a promise to provide Rs 5 lakh a year to each of 100 million targeted families for secondary and tertiary care hospitalization—seems premature and will become unsustainable over the years. Private hospitals are looking for profits and not charity!  If one can set targets for profit in your IT firm or Law firm, why should it be any different for medical industry?

What can work?

The Governments have been pushing pharma companies, medical device makers and hospitals to cut prices through various policy interventions. One of the biggest was the cut in the price of stents and knee implants in 2017 by over 70%. However, over-regulation can lead to death of these elite institutions of patient-care, which were designed to cater to the rich segment of society! We hope government policies to make private patient care affordable continues, while making adequate arrangements for the common man in the public hospitals. Can a five star hotel with luxury price tag survive if millions of poor hungry barge into it? It is also necessary that preventive health gets due focus, so that hospitals are not burdened with overwhelming load of patients, suffering from diseases like diabetes, coronary disease, stroke, kidney failure in advanced stage. Aggressive and expensive care of patients may be reserved for ‘likely to survive’ patients and not for those who are in ‘end of life’ situations. Those ‘unlikely to survive’ be shifted to palliative healthcare. The realistic expectations will prevent torture of the dying and debt trap of the families of deceased.

 The Tribune 24th November 2019

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