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‘Capacity of hospitals to subsidise treatment has gone down’

Aesha Datta New Delhi | Updated on March 12, 2018

Dr. Devi Shetty,Chairman ofNarayana Health





The country’s healthcare problems can be solved by something as simple as a Rs 10-20 contribution from each person, according to Dr. Devi Shetty, renowned cardiac surgeon, philanthropist and Chairman of Narayana Health (earlier known as Narayana Hrudayalaya).

Shetty, a Padma Bhushan recipient known for championing the cause of affordable healthcare, told Business Line that accelerating costs and poorly implemented government schemes are making it difficult for hospitals to subsidise healthcare for those who really need it. Edited excerpts:

The government’s plan for a universal healthcare programme in India appears to be hitting hurdles. Why?

Today, the government is spending just 1 per cent of GDP on healthcare. That is peanuts compared with other countries — for example, the US spends 17-18 per cent. Most European countries spend anything from 8 to 14 per cent. Sub-Saharan African countries also spend more money than us. So, we spend the least amount on healthcare. With that money how can they talk about universal healthcare? It has to depend on insurance.

They are promising people lots of things, but not living up to the promise. That is going to be very disappointing.

But insurance companies say they too are running into losses and that this isn’t a favourable business in India. Yet, the insurance scheme launched by you appears to work…

We have been running Yeshasvini for the past 10 years. If taxpayer money has to pay for healthcare, it is not going to happen. The US could not pay, with their very efficient tax collection system, with taxpayer money. The British government is struggling.

Taxpayer money could pay for healthcare 30 years ago, when people retired at 60 and died at 65. Today, people retire at 60 and go on to celebrate their 95{+t}{+h} birthday. People are going to live longer not working, than working. Then where are the taxpayers?

We have to come up with a scheme, Yeshasvini, where everyone pays some amount of money every month. This is what I have been trying to convince the Government to do.

We have 850 million mobile phone subscribers who spend Rs 150 per month just to speak on the phone. If we can collect Rs 10-20 from them every month for health insurance, we will cover the healthcare costs of 850 million people.

But the Government has to realise that if they are going to write the cheque depending on taxpayer money, the problem will be exactly like what we are facing with CGHS (Central Government Health Scheme). They (government) don’t pay but force the hospitals to give services.

With Narayana Health you have often talked about the economies of scale and how it can cut costs. Why is it that the government or other charitable private hospitals have failed to replicate this?

We can reduce costs, but there is some limit. Unfortunately, what has happened in the past 4-5 years is dollar appreciation — everything we use for the heart is imported. Then there’s inflation. And all these schemes, like CGHS, are taking a big toll on hospitals. The capacity of hospitals to subsidise treatment has gone down.

Essentially, we are not producing the number of specialists that is required. So, when there is a shortage, we have a demand, and salaries go up.

The other problem is that doctors, who come out of expensive medical schools, often don’t feel that charitable hospitals will remunerate them appropriately. How can we solve this crisis?

We have created an artificial shortage. We have 48,000 undergraduate seats and only a few thousand post-graduation seats. The US has 19,000 UG seats and 32,000 PG seats. We should have three times the number (of PG seats), and this can be done under the current MCA norms.

Once it is done, the capitation fee, cost of education, will go down significantly. But then the government has to take a call.

Why do we have the highest maternal mortality rate? Because we don’t have enough gynaecologists. We have a shortage of 1 lakh gynaecologists.

There are more than 2 lakh doctors who spend 2-5 years after MBBS in Kerala or Kota, mugging the MCQs (multiple choice questions), not working in hospitals to get a PG seat. This is a national waste. It’s a national shame. You have to equalise UG and PG seats. Then, we’ll have enough number of specialists. Then the salaries also will not hit the roof.

Published on December 21, 2013

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