What we can learn from India about health financing strategy
Bangladesh’s commitment to reach Universal Health Coverage (UHC) by 2032 does not look promising considering the country’s decade-long struggle to implement effective policies and strategies effectively
Bangladesh's current out-of-pocket (OOP) expenditure is 68.5%, which is one of the highest in the world. This means for every BDT 100 that is spent on health care; the public pays BDT 68.5. This results in a massive burden on the mass population. Recent data shows that more than 8.6 million people fell below the poverty line in 2016 simply through their spending on healthcare.
The country is committed to reaching Universal Health Coverage (UHC) by 2032. In line with this goal, the government has tried to prioritise the health sector by introducing and adopting multiple policies and strategies over the last decade. To achieve UHC, the country has planned to bring down the high out-of-pocket expenditure to 32% by 2032. Instead of decreasing, since the publication of the Health Care Financing Strategy (HCFS) 2012-2022 by the Health Ministry, the OOP expenditure has increased from 64% to 68.5%.
The main reason behind the increase is the inability of the government to implement any national social health protection scheme. The plan was to introduce a social health protection scheme, which would constitute 32% of the total health financing in the country, along with increasing government spending (which has not happened).
The failure of the social scheme can be attributed to three main reasons — high level of informal workers, low tax-to-GDP ratio and lack of readiness from the healthcare providers, which arises mainly due to the government health facilities having to adhere to the stringent public financial management rules.
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Given that we are far off-track from reaching our ambitious goal by 2032, we can take some inspiration from our neighbouring country India, and understand how they are rapidly reforming their health system.
Bangladesh and India share a lot of similarities – both countries are currently classified as lower middle-income countries by the World Bank. India also has a high out-of-pocket expenditure (62% in 2015) and it too has tried out different health financing strategies over the years.
According to the Indian National Health Authority, increasing demand for health care and high OOP expenditure are the leading causes of poverty in the country; more than six crore citizens slip below the poverty line every year.
The country introduced a government-funded health insurance scheme, RSBY, in the past, to ease the burden of health expenditure care borne by the below-poverty line (BPL) families.
Each family under the scheme could avail of up to INR 30,000 for secondary and tertiary healthcare. Even though there were 150 million beneficiaries, the RSBY failed, because it worked independently of the larger healthcare system and contributed to making the risk pools more fragmented.
The Indian government launched the Ayushman Bharat scheme in 2018 based on the recommendation from the National Health Policy 2017, the learnings from RSBY and other past experiences. This scheme was launched with the goal of reaching UHC. The scheme differs from the other policies and strategies adopted in the past, because it aimed to create a comprehensive need-based healthcare system, instead of focusing on a sectoral or segmented approach. The scheme comprises two segments–Health and Wellness Centres (HWCs) and Pradhan Mantri-Jan Arogya Yojana (PM-JAY).
The function of the HWCs, which are currently 1,50,000 in number across the country, is to provide comprehensive primary health care to everyone. Coverage is provided for not only maternal and child health services but non-communicable diseases as well, along with free essential drugs and diagnostic services. HWCs emphasise not only on providing curative care but also on health promotion and prevention activities.
On the other hand, PM-JAY provides health coverage of INR5 lakh per family for secondary and tertiary care to over 10.74 crore poor and vulnerable families, which comprises the bottom 40% of the population. The benefits under PM-JAY are many, which goes to show how well thought out the scheme is. For instance, PM-JAY provides cashless access to healthcare services at the point of service and also covers both pre-hospitalisation and post-hospitalisation expenses, including diagnostic services and medicines. Furthermore, there is no cap on the number of family members, age or gender, and all pre-existing conditions are covered from the day of enrollment into the coverage.
The beneficiaries can seek service from any empanelled health facility (both public and private) in India.
The identification of the bottom 40% of the population is based on the Socio-Economic Caste Census 2011, where the rural poor have been identified based on certain deprivation criteria, whereas the eligibility of the urban poor was based on 11 occupational categories, such as ragpickers, rickshaw-pullers, beggars, etc.
The National Health Policy 2017 recommended a comprehensive health financing strategy which India was able to implement within a year. On the other hand, Bangladesh's National Health Policy 2011 recommended a social health protection scheme called Shasthyo Shuroksha Karmasuchi (SSK), which was first implemented on a pilot basis five years after it was first conceptualised. 6 years later in 2022, the total number of beneficiaries under the scheme is 109,000 households, which covers just the Tangail district. The benefit threshold is BDT 50,000 per family and the package includes inpatient care at Upazila Health Complexes and district hospitals for 110 categories of diseases.
In summary, what India has been able to do in a year is something we could not achieve even in 11 years. Instead, our health financing system is deteriorating since OOP has been continually rising over the past decade.
It is time that we draw some inspiration and lessons from India and start adopting the necessary reforms, which will help create a suitable national health financing strategy via which we can realise the SDG goal of becoming a country which has achieved Universal Health Coverage.
Mohammad Ihtesham Hassan is currently pursuing a master's degree in Health Economics at the Institute of Health Economics, University of Dhaka.
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.
