Business Today

Booster Dose

With record healthcare expenditure and allocations focussing on mitigating the impact of Covid-19, it's a shot in the arm for the sector
twitter-logoPB Jayakumar | Print Edition: February 21, 2021
Booster Dose
Illustration by Raj Verma

The highest-ever healthcare allocation in a budget will provide the much-needed boost to the ailing economy, and pave the way for a robust, holistic public healthcare infrastructure to tackle future pandemics, according to industry experts.

The Budget outlay for 'Health and Wellbeing' for 2021/22 came in at a record Rs 2,23,846 crore, a 137 per cent increase over this year's Budget estimate of Rs 94,452 crore. It is about 1.6 per cent of India's projected Gross Domestic Product (GDP) at Rs 134.4 lakh crore for 2020/21. Finance Minister Nirmala Sitharaman, who earmarked Rs 35,000 crore for Coronavirus vaccination as a short-term overall reset to correct the ailing economy, also announced a two-pronged strategy after listening to experts in the sector.

The first being tackling the pandemic to usher in a V-shaped recovery with a short-term view, and the second, a holistic approach to address long-term shortfalls in the healthcare sector. "The Covid-19 pandemic was an unprecedented medical crisis that underlined the importance of building a resilient infrastructure" says Prathap Reddy, Chairman, Apollo Hospitals, and the pioneer of organised healthcare in India since the 1980s.

"While the Budget is cognizant of the country's immediate economic needs, it also lays out a medium-term vision of three-five years," feels Ajay Piramal, Chairman, Piramal Group.

"It is laudable that the government has put healthcare at the forefront. This would not only make quality healthcare accessible and affordable, but also help standardise healthcare infrastructure across the country," adds Abhay Soi, Chairman and MD, Max Healthcare.

Vaccinating The Economy

The finance minister allocated a massive Rs 35,000 crore for Coronavirus vaccination, and said "two or more vaccines were also coming soon" (in addition to the two already launched). The government launched the world's largest Coronvirus vaccination drive in mid-January, with a focus on frontline workers in the initial phase. However, there was no clarity on who would pay for the vaccines in the second phase, in which the elderly and vulnerable would be vaccinated -- a target of 30 crore people by July. Healthcare experts had put a figure of Rs 27,000-30,000 crore for the mission (an estimated Rs 400-500 per two doses and other expenses), an unlikely allocation under normal circumstances. Sitharaman not only surprised all, but also hinted at more allocations if required, during her Budget speech.

"Globally, investments in these areas (vaccine and infrastructure) have prevented hospitalisations and resulted in a healthier and more productive workforce, thereby leading to an efficient economy," says Adar Poonawala, CEO of Serum Institute of India, which recently launched 'Covishield' in India, and is planning three-four next-generation vaccines to address the pandemic.

"The infusion of Rs 35,000 crore for vaccine development and distribution, ensuring preventive health, frontline health and and allied workers skills building along with surveillance on infectious building, reinforces the government's assurance on public health programmes," says Ashutosh Raghuvanshi, MD and CEO, Fortis Healthcare.

"Healthcare spending is proposed to more than double, and this will help in rolling out the vaccination programme and strengthening the delivery system for building better capability and capacity to combat future pandemics," adds Rana Mehta, Partner and Leader, Healthcare, PwC India.

Holistic Healing

Healthcare experts say Sitharaman has tried to address the larger problem plaguing the healthcare sector - absence of a robust public health infrastructure. For that, the finance minister has taken a holistic view on 'Health and Wellbeing'. Covid-related 'Special Provisions' in healthcare allocations include Rs 60,030 crore for drinking water and sanitation (which was Rs 21,518 crore in the current fiscal); an outlay of Rs 2,700 crore on nutrition (Rs 3,700 crore in 2020/21); Rs 36,022 crore as grants for water and sanitation, and Rs 13,192 crore as grants for health. The budgetary allocation for the department of health and family welfare was increased to Rs 71,269 crore, from the estimated Rs 65,012 crore in 2020/21, while allocation for health research also went up to Rs 2,663 crore, against Rs 2,100 crore earlier. The budget for the Department of Ayush has been increased to Rs 2,970 crore, from Rs 2,122 crore in the current fiscal.

"The Budget provides the much-needed boost to health, nutrition, sanitation and pollution control, all of which will contribute to improved health and wellbeing," says K. Srinath Reddy, President, Public Health Foundation of India (PHFI).

More than that, there is a conscious effort to create a well-knit primary and secondary care public health infrastructure in both rural and urban areas. The Budget has announced a new centrally sponsored scheme, the PM AtmaNirbhar Swasth Bharat Yojana, with an outlay of Rs 64,180 crore over six years. The scheme aims to develop capacities of primary, secondary, and tertiary care health systems, while strengthening existing national institutions and creating new ones for detection and cure of new and emerging diseases. Around 17,788 rural and 11,024 urban health and wellness centres will be developed under the scheme, 3,382 block public health units will come up in 11 states, and integrated public health labs will be set up in all districts.

"Priority has also been given to strengthen healthcare infrastructure and increase access to healthcare facilities, especially in rural areas, which is the need of the hour. The pandemic put severe stress on the healthcare system and this move can go a long way in addressing basic needs," says Azad Moopen, Chairman, Aster DM Healthcare.

The government had announced the Ayushman Bharat Programme in February 2018, with two components of Health and Wellness Centres (HWCs), to deliver comprehensive primary healthcare (PHC) services to the entire population, and the Pradhan Mantri Jan Arogya Yojana (PMJAY) for improving access to hospitalisation services at secondary and tertiary level health facilities for the bottom 40 per cent of the population. Plans were to have 1,50,000 HWCs by December 2022. The first HWC was launched on April 14, 2018 and by March 31, 2020, a total of 38,595 HWCs were operational across India.

"This will strengthen preventive health and ensure skill-building for frontline allied health workers, while increasing robust community surveillance of emerging infectious diseases," says Preetha Reddy, Executive Vice Chairperson, Apollo Hospitals.

"The Aatmanirbhar Swasth Yojana, in addition to the National Health Mission, is a welcome step towards strengthening primary, secondary, and tertiary healthcare. However, the manner in which this allocation will be made in the next five years will be critical," says Soi of Max Healthcare.

Besides, the Budget also announced plans to establish critical-care hospital blocks in 602 districts and 12 central institutions, strengthening of the National Centre for Disease Control (NCDC), its five regional branches and 20 metropolitan health surveillance units, and expansion of the Integrated Health Information Portal for all states/UTs to connect all public health labs. Further, 17 new public health units will be launched, besides strengthening the existing ones at different points of entry - 32 airports, 11 seaports and seven land crossings. Fifteen health emergency operation centres and two mobile hospitals will also come up. Further, the scheme will help in setting up the national institution for One Health, a regional research platform for WHO South East Asia Region, nine Bio-Safety Level III laboratories and four regional National Institutes for Virology.

Experts, however, are divided on the quantum of allocation for healthcare in the Budget. "The allocation for healthcare Budget is a very slight increase of 5.7 per cent to Rs 67,484 crore, compared to last year's Rs 63,830 crore. This is lesser than the spending target of 2.5 per cent of GDP on healthcare by 2025," says Shabnum Khan, Founder, 750ad Healthcare.

"India is in dire need of a Universal Healthcare Coverage (UHC), which was not well articulated in the finance ministers Budget. The proposed budget of Rs 64,180 crore invested over six years is also not substantial. The overall spending should have been much more because we started from a very low base post-Covid," says B.S. Ajaikumar, Executive Chairman, HealthCare Global Enterprises Ltd (HCG).

Despite criticisms, most agree that the finance minister has rolled out a healthier roadmap for the future.


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