How To Make Public Health Spending In India Efficient And Effective?

Dr Krishna Reddy Nallamalla, Country Director, ACCESS Health International, India gives an insight into certain policy levers that can make current health spending more efficient and effective

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Public spending on health in India, at ~1.3per cent of GDP, is one of the lowest in the world. While the government is committed to increase it to 2.5 per cent over the next few years, there is an opportunity to make current spending more efficient (least cost per output) and effective (best outcomes in terms of access, quality, and dignity). It is estimated that nearly 20-40 per cent of current spend is wasted. There are no mechanisms to monitor whether this spend is improving health, reducing out of pocket expenses, and is responsive to health needs of people. This article reviews certain policy levers that can make current health spending more efficient and effective.

Allocation

The amount government can spend is limited. However, there is an opportunity to allocate these funds through a systematic process. Effectiveness of money spent decreases in the following order – social determinants of health (clean air, clean water, healthy diet, good habits, safe roads etc.), preventive (vaccination, antenatal care, school health programmes, screening for diabetes and hypertension etc.), curative and palliative care. For example, money spent on single heart transplantation can screen thousands of people for cardiovascular disease risk factors (diabetes, high blood pressure, smoking, high cholesterol, and obesity) and provide preventive care for those at risk. There are scientific tools (collectively termed as Health Technology Assessment or HTA) that undertake multidimensional analysis (cultural, social, political, and economical) to guide the government in proper allocation of its funds.

Spending smart

Government essentially purchases services, either from its own facilities or private providers. Every housewife knows how to make a smart bargain to get value for money.