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IMPROVING CONSUMER INTERFACE OF PRIVATE HEALTHCARE: REGULATING THE PRIVATE HEALTH SECTOR . Center for Enquiry into Health and Allied Themes (CEHAT). Growth of the Private Health Sector in India.

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improving consumer interface of private healthcare regulating the private health sector


Center for Enquiry into Health and Allied Themes (CEHAT)

growth of the private health sector in india
Growth of the Private Health Sector in India
  • In 1947, the private health sector provided only 5-10 per cent of total patient care (Sengupta 2005) but in 2004 it is 78 per cent in the rural areas and 81 per cent in the urban areas (MoHFW 2007).
  • India’s public spending on health, after increasing between 1950–51 and 1985–86, stagnated during 1995–2005.It was down to 0·95 per cent of the GDP in 2005.
  • In 2004–05, government expenditure (including external support) accounted for 22 per cent of total health and private spending in 2004–05 accounted for 78 per cent of the total spending on health (Shivakumar 2011).

Trends in Hospitalisation

Source: (MoFHW 2007 NSSO)

characteristics of the private health sector
Characteristics Of The Private Health Sector
  • Problem with Data Availability
  • Qualified/Registered and Unqualified Practitioners
  • Multiple Systems and Cross-practice
  • Rural – Urban Divide
  • Poor Registration and Standards of Private Hospitals
  • Focus on curative care
  • Unregulated Practice
  • No price regulation
  • Demand increases with increased supply
  • Price escalates with increased supply
  • System of kickbacks/cut practice
  • Professional bodies unconcerned
why regulate
Why Regulate?
  • Regulation aims at improving clinical performance (safety and quality)
  • Regulation targets risk mitigation
  • Regulation promotes ethics and social justice
  • Regulation to protect professional standards
what is regulation
What is Regulation?
  • Voluntarism- is based on an individual or organisational undertaking to do the right thing without coercion.
  • Self-regulation- is where an organised group regulates the behaviour of its members (e.g. by establishing an industry-level code of practice).
  • Economic instruments- involve supply-side funding sanctions or incentives for health care providers, and also demand-side measures that give more power to consumers.
  • Meta-regulation- involves an external regulatory body ensuring that health care providers implement safety and quality programs and practices.
  • Command and control- involves enforcement by government (e.g. ensuring compliance with rules for licensing facilities).

Source: Braithwaite, J., Healy, J., Dwan, K.,(2005) The Governance of Health Safety and Quality, Commonwealth of Australia

who should regulate
Who should Regulate?
  • Profession
  • Independent agency
  • Government
  • Legislation
  • Ethical codes
  • Insurance
  • Market
what to regulate
What to Regulate?
  • Clinical practice
  • Quality and standards
  • Protocols
  • Economics
  • Ethics
  • Legal dimensions
regulating the health sector
Regulating the Health Sector



Fiscal Measures

Audit of Medical Practice

Legal Measures

Setting of Minimum Standards

Social Audit

Professional Measures

global experience
Global Experience
  • From professional ethics to legislation
  • The insurance route
  • Examples
    • UK – Healthcare Commission
    • USA – National Quality Forum
    • Canada – Patient Safety Institute
    • Australia – National Council for Safety and Quality in Healthcare
indian experience
Indian Experience
  • Unorganised healthcare system
  • Supply induced demand
  • Poor ethics
  • Segmented legislation – fire fighting approach
  • Poor accountability, even with existing legislation
  • Dilemma of profession versus business
existing regulation
Existing Regulation
  • Medical Council of India and State Councils
  • Local bodies
  • Food and Drug Administration (FDA)
  • Clinical Establishments Act (CEA)
  • National Accreditation Board for Hospitals and HCPs (NABH)
  • Indian Public Health Standards (IPHS)
  • Only 8 states have any legislation to regulate private health sector
  • MP – legislation for regulating nursing homes introduced as early as 1973, rules framed only in 1992
  • Bombay Nursing Home Regulation Act – passed in 1949, not implemented
  • PIL in 90s by the medicofriend circle and others - in 2006, extended to all of Maharashtra
  • Clinical Establishments Act 2010 – strong opposition in several states
  • Even in states that have acts and where rules are implemented, no action against providers who didn’t register
evidence from the field
Evidence from the field

A survey of 261 private hospitals (less than 30 beds) in 11 districts of Maharashtra found that:

  • Most hospitals did not fulfill the minimum requirements under BNHRA
  • 56 per cent of the hospitals under study did not have a single qualified nurse,
  • more than 50 per cent hospitals did not have a resident doctor (24/7)
  • only 14 of 114 maternity homes had a midwife.
  • While the registration under the BNHRA was high (89 per cent), basic minimum requirements under the law such as display of certification, presence of qualified doctor and nurse, maintenance of case records were not complied with by most hospitals.

Source: CEHAT, 2010

patient welfare issues in pvt health care
Patient Welfare issues in Pvt Health care
  • Irrational use of drugs, over prescription, unnecessary diagnostics
    • Rural, tribal, poorest most exposed to over use of injections
  • No standard treatment protocols
  • Nexus between doctors and the drug industry
  • ‘Cut Practice’
  • No Grievance Redressal Mechanisms
  • Lack of information provided by health care providers
public private partnerships
Public Private Partnerships
  • There are several problems with the PPPs in health formed by the government with the private sector. The contracts between the public and private sectors have been found to be skewed in favour of the private sector. There is also hardly any evidence indicating whether or how these partnerships are increasing access to services, affecting out-of-pocket payments by patients, reducing or increasing equity or improving quality of care.

Source: National Conference Report. Emerging health care models: engaging the private sector. Mumbai, 25–26 September 2009. At: < uploads/PPP/reportfinal.pdf>.

problems with ppps
Problems with PPPs
  • No evidence that either quality of care or access increases with PPPs, nor that out-of-pocket payments reduce
  • Only take ‘safe’ cases – shifting problem – defeats the purpose
  • Low motivation of implementers – Maharashtra experience – reluctant to get enrolled to provide EmOC
  • Unnecessary procedures – often harmful – Arogyashri – hysterectomy cases among 25-40 yr old women increased by 20% since its introduction!
problems with ppps1
Problems with PPPs
  • Problems in Contracts
    • No clear deliverables
    • No clear accountability
    • No clear planning for management
    • No requisite standards for private partner
    • No clauses for exit or penalty
    • No STPs
    • No grievance redressal mechanism
    • No transparency in MoUs
the case of charitable hospitals
The Case of Charitable Hospitals
  • The charitable trust hospitals like Jaslok, Breach Candy, Bombay Hospital, Liavati, Hinduja, Nanavati, and Kokilaben Hospitals registered under the Public Trust Act receive tax waiver benefits and several other benefits like concessional land or a cheap lease rent, extra floor space ­index (FSI), concessional electricity, water or property tax, waivers or concessions for other taxes like octroi, customs duty, etc. They have an obligation to provide 10% of their beds for the indigent and an additional 10% beds for economically weaker sections, which they are not fulfilling. A CEHAT study found that most of these hospitals are not complying with this at all.
some recommendations of the hleg
Some recommendations of the HLEG
  • Establish a National Health Regulatory and Development Authority (NHRDA)
  • Mandate the Accreditation of all HCPs
  • Establish a system to independently evaluate performance
  • Establish a Health System portal to strengthen use of IT
  • Strengthen the Drugs and Medical Devices Regulatory Authority
  • Engage Pvt sector for provision of healthcare through a well-defined çontractingín mechanism.

BUT – with reduced spending on public health, how are public health facilities expected to compete?


So where do we go from here?

  • A comprehensive umberella Act – National Health Act
  • Developing a strategy for pooling financial resources deployed in health sector and redistribution based on existing resources
  • Allocation of health budgets as block funding, on per capita basis – redistribution of current expenditures
  • Contracting-in of private providers, but with proper accountability and within public health goals.
  • Compulsory public service by medical graduates – increase resources in public health system substantially

Essential drugs to be brought back under price control.

  • Location policies
  • Medical councils to ensure only licensed practitioners practice
  • Strict implementation of existing laws
  • Strengthen health information systems so as to facilitate better planning, audit and accountability.
  • DhawanRiya et al (2009) “Contract Management” in Emerging health care models: Engaging the private health sector” National Conference held during 25th – 26th September 2009, Mumbai. The conference report provides a very useful review of various PPP schemes. It can be accessed at
  • AkashAcharya and Paul McNamee, (2009) Can Public Private Partnership reduce Maternal Mortality? Assessing efforts made by the ‘Chiranjeevi’ scheme in Gujarat , PPP Conference, CEHAT Mumbai. Moyna (2010) Menopaused 20-somethings , Down to Earth, at
  • Moyna (2010) Menopaused 20-somethings , Down to Earth, at also see ,
  • Public-Private partnerships in India: A case for reform? Economic & political weekly, August 2009
  • TK SundariRavindran (2011) Public-private interactions in reproductive health services in India: A mapping, CEHAT, Mumbai.
  • Public Private Partnerships for Emergency Obstetric Care: Lessons from Maharashtra, Indian Journal of Community medicine, Jan-March 2011 /articles/PMC3104703/
patients rights charter
Patients’ Rights Charter
  • To what extent does this charter address the problems in the private sector?
  • What does it not address?
  • How would you implement this in your setting?
  • What challenges do you foresee?

Sana Contractor