Covid-19 fiasco: Why it is unfair to blame private hospitals

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By Shailaja Chandra

Covid pandemic triggers public vs private hospitals debate: We Indians have wonderful ideas, but we falter at the implementation level. I am not going to give recommendations as there is no point in doing so knowing that they will not get implemented. If the government is not willing to invest, then obviously the country will lag in all aspects of human development. We can definitely learn lessons from the Covid-19 response. I would say that this is not a government vs private or public sector vs private sector debate.

I have a number of slides in my presentation and a fair amount of research has gone into it. I do want to say that we were able to look at about 180-200 districts in the country. Of all the Covid beds, the private sector has under its control around 44%. The rest is with the public sector. So, what really came out was that the occupancy in the private hospitals was much higher than in the government facilities. That means when you are desperate to save your parent, spouse or child, you are not going to think of the money. You will go to a private hospital, even if it costs a lot.

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Shining examples of efficiency

How the Mumbai authorities managed Covid-19 was just brilliant. I’m proud that one Indian city managed to do it and was very doubtful in the beginning. I did not have much faith in the system. Now, this is something that you realize in a crisis. If you have the will and the wherewithal, you can make things work in India. Mumbai has a population of around 18 million, which is comparable to the population of Delhi, which is in fact 20-22 million. But Delhi was a real mess during the peak of the pandemic. They did not plan for oxygen, which Mumbai had done right from May 2020. They had floated tenders for oxygen supply and PPEs.

Kerala had floated tenders long before the pandemic assumed crisis proportions. Kerala had the experience of Nipah virus. So, there were states that had tremendous imagination and initiative to do things without waiting for orders. The sad thing was that the kind of coordination one expected was there in 2020. I spoke to several state health secretaries and found that they were talking daily with the Union health secretary.

I am not trying to push for the private hospitals, but do realize that foreign direct investment into the health sector was permitted by the government. It was permitted by finance ministry, not health ministry. We were nowhere in the picture. I was very much in the ministry when all this was happening and it was not a decision of the health ministry. We didn’t even know it had happened.

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Regulate private hospitals, do not blame them

FDI came and lots of money was pumped in as a business. Remember it was never for charity. It required regulation by the government. I have written three articles by now saying that we do not have a regulator like telecom regulator or power regulator. I know very well that the regulation is pretty tight in those sectors. Then, why can’t there be a regulator for health, instead of blaming the private sector for making money.

There is no regulator for the Clinical Establishments Act, and there will never be, take it in writing from me. Even the few states that have done it have not issued the rules or appointed people to do the oversight. These regulators are as good as non-operational because it hits exactly where it hurts private hospitals. I’m not talking about the corporate sector. I’m talking about the private nursing homes. They take anyone off the road and treat him as an assistant. He, later on, becomes an unqualified medical practitioner. They take any girl, put her in white uniform, and with a little bit of training, she’s called a nurse.

If you have the Clinical Establishment Act in operation, you will have to notify who you are employing, what are their qualifications, and what are the services you’re giving. If you are doing only maternity work, you cannot be doing something else. If you’re doing general surgery, you cannot be doing specialized work. So, the Clinical Establishment Act brings in transparency, which none of these private hospitals want. That is why IMA opposed it tooth and nail. And governments ultimately listen to where the strength lies. I’m glad that Policy Circle is actually trying to give a podium for these things to come out.

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Insuring population is the way out

The people below poverty line need to be taken care of the way it is happening under Ayushman Bharat. What happens to the middle class informal white-collar worker, a fairly large segment? They have no insurance cover and they do not have the money. They say that even if they are earning to be able to put in Rs 45,000 as premium, if there’s a parent to be looked after, then the amount goes up to Rs 90,000.

This is something that needs to be addressed. I am not blaming the insurance companies. Something that you must have at the back of your mind when you talk of the private sector, two-thirds of the hospital bed capacity is owned by the private sector in India. Large hospital chains account only for 4-5% of the beds while the rest 95% is owned by smaller standalone private hospitals and nursing homes.

So, when we talk about the performance of the private sector, I’m talking about 4-5%, not the 95%. What happens in the 95%? If there are just 10 beds or 20 beds, they just folded up because they just didn’t have the staff as people went away. Some opened for certain other things like maternity services and all because they found them completely without any kind of work. But that was also very small. Who was permitted to keep Covid patients was very much under government control? Of the 95%, how many were allowed to keep Covid-19 patients? I don’t know.

Private hospitals did not shun responsibility

When we talk about large hospitals, I am referring to Apollo, Max, Manipal, Narayana, Fortis, Medanta, and large regional players like Sterling. They fall in this 4-5% bracket. They did facilitate tele consultations that helped to have doctors on call 24X7. Where else could you get to talk to a doctor 24/7? They established flu clinics at the entry and the employees and the visitors were also screened.

They have to be very careful about who they’re letting in, but they did it. They ramped up their infrastructure. And I talked to managements in two or three of these large, hospital conglomerates. And they definitely incurred capital expenditure. They didn’t wait for anything else to happen. They got all these things. The ICUs and the ventilator beds were ramped up. We still fell short, but the fact remains that they did do these things.

Most of these chains did it, and they did not wait for any handholding. They also listened to state governments. I talked to governments of Kerala, Delhi, and Maharashtra. In all cases, there was no doubt that the state government had full authority and, in the beginning, it was a bit problematic. Later on, they exercised the authority.

There were orders to private sector hospitals, and they complied. This is just to show what has happened. Except Mumbai, no other state in the country managed to set up a network to face the pandemic. Nobody had the imagination to do it. Willy nilly, they took patients to hospitals. All of them did not have a good time. We know of a retired ambassador who died in the parking lot.

And I want to share with you a personal example. I got calls from Manila from a senior person whom I knew in Singapore for a hospital bed. And I tried no private sector. The hospital was really willing to give a bed, but they said there is a waiting list of 400 people. Ultimately, I had to speak to the government sector and beg them. Even then the poor people had to wait in the emergency for about two hours before they were allotted a bed in a government hospital. Things were extremely bad and I’m talking about Delhi. I do not know really what may have happened in other state capitals.

Govt must plan for the uninsured

So, this is the story of what the private sector did. There must’ve been overcharging. There must’ve been horror stories about how people were treated. Please don’t look at this as a kind of defence. It is only to say that thanks god, India had at least 4-5% which did not suddenly throw their hands up. They did something about it. Now coming to insurance coverage, and this kind of thing has been collected from IRDA, PMGY, ESI and various published articles.

Health insurance penetration, the percentage of population covered or eligible under health insurance, is very small. About 74% of Indians are either covered or eligible for coverage under either health insurance or government health schemes. The uninsured is 26%. That is 36 crore people who have a white-collar job who do not have insurance. Well, maybe self-employed or maybe in companies or in, you might say non-government areas where there is no insurance offered. How do they avail insurance at a cost which is reasonable and affordable?

And then there are additional families also under PMJ which are about 20 crores, 65% of the government scheme beneficiaries. Whoever is getting government benefits through different schemes, they become eligible for PMJAY. Do they get it? Do they actually get covered in the hospitals? That’s a totally separate issue. from the anecdotal evidence I have, they pay out of pocket.

There is quite a sizeable out-of-pocket expenditure. So, ultimately the most important lesson would be to build a skilled pool of manpower that is badly needed. To enhance public-private sector participation in Ayushman Bharat. We have to look at the middle group that I talked about — 36 crore people. What’s going to happen to them. Where do they get the money? We need to enable people to get insurance cover.

(Shailaja Chandra is former Chief Secretary, Delhi and former secretary, ministry of health, government of India. This article is the reproduction of her presentation at a webinar organised by