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Developmental Issues

Model contract: Under the Public Private Partnership , care for three non-communicable diseases — cardiac disease, pulmonary disease, and cancer care — will be provided.  

As a part of a radical ‘privatisation project’, the Health Ministry and the NITI Aayog have developed a framework to let private hospitals run select services within district hospitals, on a 30-year lease.

In a 140-page document, prepared in consultation with the World Bank, the government will be allowing “a single private partner or a single consortium of private partners” to bid for space in district level hospitals, “especially in tier 2 & 3 cities.”

Under this Public Private Partnership (PPP), care for only three non-communicable diseases — cardiac disease, pulmonary disease, and cancer care — will be provided.

A model contract drawn up by NITI Aayog was sent out to State governments on June 5 by Amitabh Kant, Chief Executive Officer of NITI Aayog, giving the states a two-week window to furnish responses.

In a letter sent out last month, Mr. Kant adds that the draft document was prepared by a working group comprising representatives from the industry, Health Ministry and “representatives of a few states”.

The policy document has come under sharp criticism for the Ministry’s failure to consult with key stakeholders from civil society and academia. Dr. Amit Sengupta, convener of the India chapter of the People’s Health Movement, said that the government was handing over critical public assets without gaining anything much in return.

“NITI Aayog has no locus standi to make health policy, which is a state subject in India. The logic behind shutting down the Planning Commission was to ensure that policies are not centralised. NITI Aayog was to be an advisory body but here they are rushing through a policy that will essentially hand over public assets to the private sector, leading to a further dismantling of the public services available for free. If the government has to give seed money, share blood banks and other infrastructure, and still not be able to reserve beds for poor patients, it seems like we are not getting much in return,” said Dr. Sengupta.

Mr. Kant, Health Minister JP Nadda and Health Secretary C.K. Mishra did not respond to emails and phone calls.

According to the draft model contract, private hospitals will bid for 30-year leases over portions of district hospital buildings to set up 50- or 100-bed hospitals in smaller towns across the country. The State governments could lease up to five or six district hospitals within the State.

Further, the State governments will give Viability Gap Funding (VGF), or one-time seed money, to private players to set up infrastructure within district hospitals. The private parties and State health departments will share ambulance services, blood banks, and mortuary services.

A major concern about the policy is that under ‘principles’ of the financial structure, the document states that “there will be no reserved beds or no quota (sic) of beds for free services” in these facilities.

“While it is clear that insured patients will receive free care, it is not at all clear what will happen to the vast majority of the population. In particular, how will these referral arrangements work? Whereas it says that states can, if they wish, refer 100% of patients for cashless care, it is a matter of concern that it also proposes that States can set a cap on this entitlement. How would this work? What happens when the cap is reached? Would people only be able to access services for half the year, or less,” said Robert Yates, a leading expert on universal health coverage (UHC) and Project Director of the UHC Policy Forum at Chatham House, London.

“What is particularly disturbing is the suggestion that only Below Poverty Line (BPL) patients and those in insurance schemes will be able to access free care. This would effectively exclude hundreds of millions of the Indian population from vital hospital services.

“If implemented, these proposals could threaten to take India away from UHC, a key sustainable development goal, rather than towards it,” Mr. Yates said.

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