Shamika Ravi, Rahul Ahluwalia
February 20, 2015
The Draft National Health Policy 2015 fails to tackle head-on the core problem of the Indian health system: its management, administration and overall governance structure
The Draft National Health Policy of 2015 released by the Ministry of Health and Family Welfare, Government of India, is a comprehensive document. So comprehensive, in fact, that it says too little by saying too much. A National Heath Policy is commonly read as a political statement which is meant to provide a vision to the long-term health strategy for the country. The latest health policy speaks about a wide variety of issues that plague our health-care system — low public health expenditure, inequity in access, and poor quality of care. It also suggests a variety of ways to address them, mainly focussed around increasing government spending on health and expanding the public delivery system. However, the health policy fails to tackle head-on the core problem of the Indian health system — its management, administration and overall governance structure, without which the measures it suggests are merely symptomatic treatments, akin to putting a “Band-aid on a corpse.”
The policy draft itself provides evidence for this malaise. Russia and South Africa both spend a significantly higher amount on public health than India. In fact their spending is even higher than the target set by the draft health policy, yet they have life expectancies that are worse, as in the case of South Africa, or only marginally better, as in the case of Russia. On the contrary, Sri Lanka and Bangladesh are both countries that actually spend less on their healthcare (as a percentage of GDP) than India, yet both have better outcomes. Within India too, the draft policy notes that States with better capacity have utilised the National Rural Health Mission (NRHM) funds more effectively, while States with poorer initial conditions have been left with worse outcomes. The fundamental difference lies in management and governance structures.
Criticality of administration
The evidence from the draft policy does not stand alone, and is, in fact, supported by a rich literature. Globally, research findings have highlighted the criticality of administration in improving health outcomes. Rajkumar and Swaroop in a 2008 study find that the effectiveness of public health spending in reducing child mortality depends on the level of perceived corruption. It is found that higher integrity is associated with reduced child mortality. Gupta et al in a 2000 paper show that corruption indicators (using Kaufman, Kraay and Zoido-Lobatón, 1999) are negatively correlated with child and infant survival, attended births, immunisation coverage and birth weight. These results are robust even after accounting for spending on public health, education, and urbanisation. In a study looking at the United Nations’s Millennium Development Goals, Wagstaff and Claeson in 2004 conducted an analysis which showed that across-the-board additions to government health spending have no significant effect on underweight children, maternal mortality, or tuberculosis mortality in poorly governed countries. They defined poorly governed countries as being one standard deviation below the mean score on the World Bank Country Policy and Institutional Assessment (CPIA) index. They estimated that for across-the-board spending to have a significant effect on outcomes such as malnutrition and tuberculosis mortality, the CPIA score for a country has to get above the population-weighted average of 3.5. India’s score in 2011 and 2012 was slightly below that threshold. Bannerjee and others in 2008 provided evidence from an experiment within India. They find that an incentive programme designed to increase nurse attendance in Rajasthan was initially successful but was eventually undermined by the local health administration and workers. They concluded that piecemeal attempts to improve health delivery would be ineffective until health system reform becomes a top priority for the stakeholders.
“India’s governance systems today fix responsibility, but do not provide flexibility and accountability ”
Governance structures
The weight of evidence clearly suggests that if we want our health outcomes to improve, the Indian health policy needs to focus on how its health system is governed and managed. While our people are among the best and brightest, long years of neglect and misgovernment have vitiated our public management systems with perverse incentives. It is easier and more sensible for people within the system to subvert their jobs — through chronic absenteeism, endemic corruption and private practice — than to actually do them. The draft policy mentions band-aids for a few of these problems, but it needs to prioritise and lay far greater focus on the critical issue of governance and management of the Indian health system.
Governance structures need to balance responsibility, flexibility and accountability (Feldman and Khademian, 2001) in order to carry out their functions. It is clear that our systems today, at best, fix responsibility, but do not provide flexibility and accountability — managers/bureaucrats need to do their jobs. A useful, and not entirely radical, model to consider would be the one pioneered in India by the Tamil Nadu Medical Services Corporation. It is a registered corporation set up by the Tamil Nadu government to procure drugs for the public health system. It is accountable to an independent board of directors which includes the health secretary. The corporation has an IAS officer as its managing director, and professionals and academics are hired or taken on deputation as deemed necessary. The model has proved so successful in improving drug supply in Tamil Nadu that several other States, including Kerala, have adopted it as the basis of their own governance structure.
A similar governance structure at the State level, albeit at a much larger scale, could be a suitable vehicle for the coming expansion of public delivery in primary and preventive healthcare in India. Present health workers and doctors who are employees of the government can be absorbed on deputation, while new hiring and capacity building can be carried out by the corporation. Thus, they will not be hampered by either restrictive government rules for employees, or the negative image that is associated with short-term contracts which became the favoured capacity building instrument for the NRHM. Internationally, this model is in fact already quite well established in the healthcare delivery space. The National Health Service of the U.K., one of the largest organisations in the world, already operates on a very similar model, with an executive board that is accountable to the secretary of health. Its mandate and targets are set by the government, but it operates as a largely independent entity. Finances are devolved to local health boards, which ‘purchase’ or contract NHS primary care providers and hospitals on a services rendered basis, ensuring accountability at the local as well as the highest levels.
Whether or not this specific type of model is adopted for healthcare delivery in India, the more fundamental point is that governance and management of any health system is a core determinant of its effectiveness. The National Health Policy of the Narendra Modi government should make it a prominent focus of reforms, thereby announcing a tectonic shift in India’s healthcare system.
(Shamika Ravi is Economist, Brookings Institution, India Center, and Rahul Ahluwalia is Research Associate, Institute for Financial Management and Research, Chennai.)
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