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Rampant Corruption Just One Challenge In India’s Healthcare Struggle

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Most of the debate around healthcare touches upon the overall spends and the allocations that follow. Actually some of the worst form of excesses, misappropriations and mismanagement happens under the broad head of health spend in India, as SPR Foundation (IndiaSpend) has repeatedly found.


The corruption cases and Central Bureau of Investigation (CBI) raids against Uttar Pradesh Family Welfare Minister Babu Singh Kushwaha only confirms this. The authorities are presently probing irregularities in some Rs 10,000 crore allocated under the National Rural Health Mission (NRHM) to the state.  But corruption, as IndiaSpend’s Sourjya Bhowmick finds out, is just one of the many problems that plague India’s healthcare sector and the NRHM.


The NRHM was started in 2005 with the intention of rebuilding and strengthening rural health care and increasing public expenditure on health.


Expenditure On Health


Over the years, India’s minimal public spending has led to de facto privatisation of healthcare in India. For instance, in 2003, private hospitals accounted for 82% of India’s expenditure on health. It was estimated that 70% of all hospitals and 40% of all hospital beds were in the private sector.


Total spending on India’s health, as per the National Health Accounts was Rs 1,33,776 crore, during 2004-2005 (before the start of NRHM), or just 4.25% of India’s GDP then. But this figure includes private expenditure and funding from other external sources. Public expenditure was Rs 26,313 crore, approximately 19-20% of the total expenditure on Health. Public expenditure on health, as a part of India’s GDP accounts for 0.9%. Out of pocket expenditure, as a percentage of private expenditure on health, was near 90% in 2007.


Here’s a look at what an average person spends on hospital bills


  1. Indians spend an average of 58% of their total annual expenditure when hospitalised.
  2. Over 40% of Indians borrow heavily or sell assets to cover expenses.
  3. Over 25% of hospitalised Indians fall below poverty line due to hospital expenses.


But private healthcare is also out of reach for most Indians.  A National Sample Survey Organisation study says in 2004, 28% of ailments in rural areas go untreated due to financial reasons, up from 15% in 1995-96. Likewise, in urban areas 20% of ailments go untreated, up from 10% in 1995-96. Of the 15,393 hospitals in India in 2002, roughly 2/3rds were public.


Financing Post NRHM


Now, the NRHM as we pointed out, was introduced in 2005.  This was also the first time there was a well illustrated plan, incorporating the Panchayats and the States with a Centre-State funding mix in the 85:15 ratio.


A sudden increase in health financing (as well as manpower and infrastructure) can also be noticed in the post NRHM period. However, public spend has not reached the desired benchmark of 2.3% of GDP that was set by the Health Ministry. In 2009-2010 public spend was 1.45% of the total GDP.


Let us have a look at the budgetary allocation of the NRHM, since inception.

As on 2001-2002, there were 137,311 Health `Sub Centres’ (the most `peripheral’ unit available at village level), 22,842 Primary Health Centres (PHC’s), 3,043 Community Health Centres (CHCs), 4,048 hospitals and a workforce of 345,514. Now, here’s what the Government claims has been done under the NRHM in terms of mobilisation of manpower and infrastructure.


Other NRHM Initiatives:


1) 594 District Hospitals, 2,721 Community Health Centres (CHC’s), 5,459 Primary Health Centres (PHC’s) and 31,001 Health Sub Centres were to be set up or upgraded/renovated.

2) 8,351 Primary Health Centres (PHC’s) are now functional all around the year, as compared to 1,262 in 2005. As on March 2007, there were 22,370 PHCs in India (Source: World Health Organisation)

3) 2,353 Health Facilities , including District Hospital , Sub–District Hospital and CHC’s function as First Referral Units (FRU)  as compared to 955 in 2005.

4) 1,834 Mobile Medical Units operate in different states providing services and covering 444 districts.


All district hospitals were provided Rs 20 lakh as initial cost of up-gradation, district hospitals in the North Eastern area were given Rs 1 crore and all CHC’s were provided Rs 20 lakh. Still, as this document suggests more financing is required in the rural health sector, as it was widely neglected in the past.


High Focus of the NRHM:


NRHM has given a special “High Focus States” tag to states like Bihar, Chattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh, Uttarkhand and Assam. Here’s how they stack up.


The current population is based on Census 2011.

Figures of Uttar Pradesh are till 1st Jan, 2011.

Figures of other states are till 2009.


High Absentee Rate


The High Focus States account for 47% of the country’s population  and represent the core of poor health performance when it comes to Maternal Mortality Rate (MMR) and under 5 years Infant Mortality Rate (IMR), life expectancy among other health indicators.


While corruption is one problem with NRHM as the UP case shows, factors like absenteeism can be quite damaging too. The absentee rate across states is 40%, as a study points out. In Rajasthan, it is more than 50%.


Surprisingly, a field survey by Harvard shows that “still not opening hours” and “is open every day, but closed today” seems to be the most popular reason for closed health centres in rural areas. The following table outlines the absentee rates of Doctors in a few ‘high focus states’.


Problems Faced Across The Board


If you think that this is the case with financially poor states then you are wrong. Tamil Nadu has an absentee percentage of 60%!


Nurses, Group D staff are known for being away from duty because they are inclined to work part time in private hospitals. When it comes to health worker absenteeism, India ranks among the most absent in the world. Peru (25%), Bangladesh (35%) and Uganda (35%) do better.


The Indian Human Development Report, 2011, prepared by the Planning Commission admits the health related Millennium Development Goals will not be achieved in the stipulated time. A major percentage of women still deliver at home, and still a lot needs to be done to increase the number of Primary Health Centres and health personnel.


For which, public expenditure has to be increased to reduce the burden of out of pocket expenditure. A study by WHO India suggests that spending on health should be 5-6% of their total consumption expenditure on health and 11% of all non-food consumption expenditure.


Another glance:


a)    India has 6 physicians per 10,000 population compared to 14 in China. As per the Medical Council of India, total number of doctors registered in 2008 was 695,254. It means a ratio of 6 per 10,000 which is lower than most developed countries. In a state like Madhya Pradesh, 196 out of 1,155 Primary Health Centres’ functioned without a doctor.


b)    Nurse to population ratio in India is 1:1205. As on Dec 2008, states like Himachal Pradesh, Karnataka, Tamil Nadu, UP, West Bengal none of the Sub Centres had two Auxiliary Nurse Midwives (which is a desired level), while states like Bihar, Jharkhand, Chhattisgarh were unable to recruit them.


c)     The NRHM had the goal to ensure two Auxiliary Nurse Midwives (ANM’s) at 30% of the sub centres by 2007 and 60% by 2008 with the second ANM being appointed on a contract basis. However, there 116 Sub centres of 20 states, which is 9%, had no ANM’s. In 992 sub centres, which is 77%, of 29 states/UT’s, two ANM’s were not posted, as per a survey done by CAG in March, 2008.


This report uses Government data to focus on some obvious and visible gaps in public health infrastructure. The UP corruption case shows how politicians and government officials do not allow even these resources to reach ailing citizens. Fixing that will take more than just increased spend as a percentage of GDP.

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