Healthcare Sector Expectations from the Union Budget 2015-16

Healthcare Expectations
Prabhu Ram, Head - Industry Intelligence Group

Prabhu Ram, Head - Industry Intelligence Group

Healthcare Sector Expectations from the Union Budget 2015-16

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Over the past many years, India has undertaken significant strides in overcoming the challenges of availability, accessibility and affordability of quality healthcare. Public as well private players have contributed to quality healthcare through enhanced geographical coverage, enhanced healthcare services and increasing healthcare expenditure. The Indian healthcare industry is projected to continue its rapid expansion, with an estimated market value of US$ 280 billion by 2020.

However, the challenges pertaining to demand and supply, lack of health infrastructure, continue to exist.

The Union Budget 2015-16 promises to make a radical departure from the past, and expectations from the government are high.  With respect to achieving the goal of universal, affordable healthcare for all, some key suggestions and expectations are outlined below:

  • Improving Healthcare Accessibility and Affordability

With the goal of Universal Health Coverage, Government should aspire for optimal spending to enhance healthcare coverage.

As part of Universal Health Coverage, comprehensive health screening of citizens should be planned.

It would be a welcome idea to have a National Health Assurance Program that provides some essential health services for citizens, and insulated from inflationary trends on healthcare delivery costs.

Currently, a maximum of INR 15,000 can be claimed for deduction under Section 80D with senior citizens being entitled for an additional INR 5,000. Given the increasing health costs, these limits should be enhanced.

Doing away with the service tax on health insurance can enhance accessibility and affordability to quality healthcare. Currently, there is a service tax of 12.36% on the total premium amount.

  • Affordable Medical Devices through ‘Make in India’

 The Government should rationalize the duty structure and ensure uniformity between domestically manufactured medical devices and imported ones.

A preferential purchase policy or “Buy Indian” outlook could in turn contribute to an increase in domestic manufacturing under the Make in India initiative.

  • ‘Skilled India’ measures to encourage next-gen scientists

Promotion of greater industry-academia linkages would boost rapid skill development and knowledge assimiliation. Alongside, curriculum upgradation would enable the next generation of scientists to be developed in India.

Budgetary allocation towards specific projects and schemes for promoting skill development in advanced technology areas would be a welcome measure.

  • ‘Digital India’ for enhanced clinical outcomes

Given the focus of the Prime Minister, Hon. Shri Narendra Modi on using technology, there should be a case for greater role of technology usage in tracking clinical outcomes, developing clinical metrics, leading to cost-effective clinical outcomes. Initiatives such as the Tamil Nadu Health Systems Project (TNHSP) provide a very good ‘working model’ of how to effectively deploy technology for better patient monitoring and improved healthcare outcomes, at a state-wide level. These should be swiftly replicated across states, especially those with endemic poor health indicators such as Uttar Pradesh, Bihar and Chhattisgarh.

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