McKinsey’s prescription for Indian healthcare

Report envisions expansion of healthcare through extensive insurance coverage, which could move to 75% from current 25%
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First Published: Wed, Dec 19 2012. 12 06 AM IST
Indian healthcare is envisaged to grow from a $65 billion industry currently to $100 billion by 2015. Photo: Mint
Indian healthcare is envisaged to grow from a $65 billion industry currently to $100 billion by 2015. Photo: Mint
As the health ministry gets ready to roll out universal health coverage (UHC), the private sector is carving out a role for itself in the long-awaited changes that will be introduced in the 12th Five-Year Plan period (2012-2017). The challenge of inadequate infrastructure, fund shortages and inefficiency in the public sector can be overcome only by forging partnerships with private companies, health minister Ghulam Nabi Azad said in Delhi on Tuesday while releasing McKinsey and Co.’s India Healthcare: Inspiring Possibilities, Challenging Journey report.
While public health experts have recommended that the government move from “insuring” to “assuring” health by investing in primary care, the McKinsey report envisions the expansion of healthcare primarily through extensive insurance coverage, which could move up to 75% from the current 25%. Only those uninsured—patients from the economically weaker sections of the society—would be covered under government-run insurance programmes such as the Rashtriya Swasthya Bima Yojana (RSBY).
The report also recommends the total spending on health be raised to 5.5% of gross domestic product (GDP). According to the Planning Commission, India will spend 1.85% of GDP on core health by the end of the Plan period. Indian healthcare is envisaged to grow from a $65 billion industry currently to $100 billion by 2015. Industry analysts recommend that the healthcare sector be accorded “infrastructure” status to plug financing gaps and improve the sector’s outcomes.
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According to the World Health Organization (WHO), the Indian health sector had a doctor-patient ratio of 1.7 per 1,000 population in 2000 as against the WHO norm of 2.5 per 1,000 patients. The bed density was 0.67 per 1,000 patients while the global average is 2.6 per 1,000, and the WHO benchmark is 3.5 per 1,000 patients.
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First Published: Wed, Dec 19 2012. 12 06 AM IST
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