Health Policy Plan 2003 Peters 249 60

doi: 10.1093/heapol/czg031 HEALTH POLICY AND PLANNING; 18(3): 249–260 Health Policy and Planning 18(3), © Oxford University Press, 2003; all rights reserved. Lumping and splitting: the health policy agenda in India DAVID H PETERS,1 K SUJATHA RAO2 AND ROBERT FRYATT3 1Department of International Health, Johns Hopkins University Bloomberg School of Public Health, Baltimore, USA, 2Ministry of Health and Family Welfare, New Delhi, India and 3Health and Population Division, Department for International Development, London, UK Key words: India, health policy, health transition, equity, federalism Introduction India’s health system is at a unique position in its history. The health system bears a large proportion of the world’s health burden, with 23% of all childhood deaths and 25% of all maternal deaths occurring in India (WHO 1999). But rapidly changing health conditions, new technologies, transformations in society and evolving roles for government and the private sector is forcing India’s health system to adapt. This paper discusses how changes are needed in policy at both central and state levels. In most countries, policy debate focuses on reforms at the national level, and at best, struggles with the question of decentralization to states and districts. There is an underlying belief that moving decision-making closer to users of the health system will make health systems more effective and accountable (WHO and UNICEF 1978; Ministry of Health and Family Welfare 1983). There has been very limited analysis and academic debate of options for decentralization to states within large federal health systems, particularly in resource poor settings. In this paper, we show that conditions are so varied across states in India, many of which have very large populations, that policies and programmes specific to state and local conditions are needed to address them. The central government, having made some progress on much of its current agenda, also needs to take on new roles, and provide a better framework to not only address health issues of national importance, but also to better facilitate the states to pursue their objectives. In this paper, we use a simple framework for assessing policy context, process and content to assess the policy challenges facing India’s national and state governments (Walt and Gilson 1994). We use results from a large set of studies and consultations conducted to examine future directions for India’s health system (Peters et al. 2002), and an extensive country study conducted for the Commission of Macroeconomics and Health (Misra et al. 2002). National context India’s population of just over 1 billion people is governed by a democratic federal system that includes the Union government, 35 states and Union territories, 593 districts, and in most states, three lower levels of local government (panchayati raj) at the district, block and village levels. There are 18 major states, each of which has a population of more than 15 million people. With a per capita income of US$440 (World Bank 2001), overcoming poverty stands out as the most important challenge facing India. About 435 million Indians are estimated to live on less than US$1 a day, comprising 36% of the total number of poor in the world (World Bank 2000a). Whereas there has been considerable decline in poverty rates in the 1970s and 1980s, methodological problems in recent surveys have made it difficult to be precise about recent trends.1 The Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 India’s health system was designed in a different era, when expectations of the public and private sectors were quite different. India’s population is also undergoing transitions in the demographic, epidemiologic and social aspects of health. Disparities in life expectancy, disease, access to health care and protection from financial risks have increased. These factors are challenging the health system to respond in new ways. The old approach to national health policies and programmes is increasingly inappropriate. By analyzing interand intra-state differences in contexts and processes, we argue that the content of national health policy needs to be more diverse and accommodating to specific states and districts. More ‘splitting’ of India’s health policy at the state level would better address their health problems, and would open the way to innovation and local accountability. States further along the health transition would be able to develop policies to deal with the emerging epidemic of non-communicable diseases and more appropriate health financing systems. States early in the transition would need to focus on improving the quality and access of essential public health services, and empowering communities to take more ownership. Better ‘lumping’ of policy issues at the central level is also needed, but not in ways that have been done in the past. The central government needs to focus on overcoming the large inequalities in health outcomes across India, tackle growing challenges to health such as the HIV epidemic, and provide the much needed leadership on systemic issues such as the development of systems for quality assurance and regulation of the private sector. It also needs to support and facilitate states and districts to develop critical capacities rather than directly manage programmes. As India develops a more diverse set of state health policies, there will be more opportunities to learn what works in different policy environments. 250 David H Peters emerging consensus is that poverty levels have decreased during the 1990s, but the amount of the decline remains unclear. Non-income measures of deprivation are also substantial in India: about 21% of elementary age children (ages 6 to 14 years) are not enrolled in school, with a gender gap for school enrolment of nine percentage points (World Bank 2001). A large consultative analysis with India’s poor revealed that their vulnerability to disease, crop failure, labour market fluctuations, domestic violence and natural disaster are important elements of what makes them insecure, and are some of the main causes of their poverty (Narayan et al. 2000). Women, the socially marginalized and other underprivileged groups are particularly vulnerable. Political changes in the early 1990s have also changed the relationship between central, state and local governments. On the one hand, the 73rd and 74th Constitutional amendments of 1993 provided a legal basis for local governments (Government of India 1996), which helped to strengthen participatory processes at the local level. On the other hand, fiscal profligacy and mismanagement by most state governments, and imbalances in the sharing of resources and constitutional responsibilities, have made them more dependent on the central government for financial resources. This has disrupted the balance of powers and responsibilities between the centre and the states, with the centre gradually encroaching on areas that fall within the mandate of states according the seventh Schedule of the Constitution (Government of India 1996). For example, although the states now account for 75–90% of public spending on health, about 80% of these funds are committed to salaries and wages (Selvaraju 2000), often making states dependent on the centre for critical inputs such as drugs, equipment and other non-wage items. Ironically, capacity for health policy and action appears to have eroded in many states, with some states being unable to even absorb the small quantum of funds provided by the centre. Differences between states have not only affected the implementation of health programmes, but are also reflected As indicated above, the Constitution outlines the division of responsibilities in the health sector among the state, central and local governments, with the state essentially responsible for the delivery of health care. The National Health Policy 1983 was strongly based in the rhetoric of the Bhore Commission, which gave direction to an Indian public health service at the time of Independence (Bhore et al. 1946), as well as the influence of the Alma Ata Declaration of Health for All by the Year 2000 (WHO and UNICEF 1978). Though both Bhore and Alma Ata envisioned a strong, integrated public health services system based on the foundations of decentralized primary health care services, in practice, public resources to run such a system were never adequate. As the states struggled to maintain and administer secondary and tertiary level facilities, they became increasingly dependent on the centre for financial assistance to implement disease control and community-based health services. In turn, the centre increasingly gained financial and programmatic control of these areas, adversely affecting the development of technical and organizational capacity in the states, as well as eroding their sense of ownership and accountability to outcomes (Misra et al. 2002). Health sector context Within the health sector, it is important to recognize how the health transition has become a driving force for changes in policies and programmes. The health transition encompasses a demographic transition (shift from high mortality and fertility to low mortality and fertility), an epidemiological transition (shift in the dominant pattern of disease from malnutrition and communicable diseases of childhood to chronic diseases of adulthood), a social transition (shift from low to high knowledge and expectations of the health system), and technological development of diagnostic and therapeutic modalities. The profound impacts are shown in increasing life expectancy from 49 years in 1970 to 63 years in 1998 (Registrar General 2000), and halving infant mortality from the 1950s to 1990, though the rates now seem to be stagnating (Claeson et al. 2000). Yet the health transition has not been smooth. Avoidable health losses from malnutrition and from communicable and readily prevented or treated diseases of maternity, birth and childhood continue to be a concern, particularly in lesser developed regions and for the poor (Peters et al. 2002). As segments of the population progress along the health transition, there is evidence of an increasing fraction of the disease burden and of health expenditures being attributed to high-cost-per-episode diseases (e.g. heart disease, diabetes, cancer) (Ramana et al. 2002). In addition to the technical challenges of dealing with new risk factors and diseases, the transition raises the importance of India’s ability to protect individuals and households from financial ruin on account of mounting medical bills. Furthermore, expectations about the quality of medical care are also rising. Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 India’s economic and political life since the 1990s has been characterized by greater openness and competition, often attributable to the economic reforms introduced in 1991, which emerged out of a current account deficit crisis, and has led to a significant increase in private investment. Economic growth jumped to an unprecedented 7% annual growth rate from 1993–97, and has averaged about 6% since then (World Bank 2001). India continues to accommodate remarkable diversity as the world’s largest democracy, though small parties representing regional or special interests have had a growing influence on national politics. There were three national elections between 1996 and 1999, with the latest producing a relatively more stable coalition government. This stability has resulted in more attention to development and economic issues. Yet political uncertainty continues, due partly to the lack of a majority political party, and the ongoing conflicts in Kashmir and other areas of civil unrest, notably in the northeast of the country. The consequence of this volatile political situation is that reforms in all public spheres, including the health sector, have become more gradual than radical, due to the political costs, coalition politics and lack of consensus on many key issues. in differences in politics, governance and security, which all point to the urgency for a more state-specific approach to health policy. Health policy in India Examination of health outcomes among states shows how the health transition is affecting states in different ways (Table 1). States like Kerala are well along in the health transition, with infant mortality rates of only 16 deaths per 1000 births, in contrast to Orissa and Madhya Pradesh, where the rates are 98 (Registrar General 2000). Total fertility rates are below replacement levels in Kerala (1.8) and Tamil Nadu (2.0), but are over 4.8 in Uttar Pradesh and 4.4 in Bihar. Based on a ranking of health outcome indicators, the states of India can be categorized according to where they fall in the health transition (Table 2). This approach can be useful for highlighting the need for different policy approaches to accommodate the different needs of states. 251 There are many other factors that will influence the policy choices to be made between and within states, including factors that affect health conditions, such as lifestyle differences, geographic exposures and natural risks, as well as differences in social environment such as poverty, social capital, levels of education and political outlooks, and capacity of the states to provide oversight and manage the health sector (Table 3). Mountain states have their particular exposures to disease (e.g. high burden of tuberculosis, low risk for malaria) and have more problems with physical access to health facilities than those living in urban areas and plains states. This may require a different emphasis on public sector delivery and transport systems than would otherwise Table 1. Selected health status outcomes in major Indian states Population (millions), 1999 Life expectancy at birth (years) 1992–96 Infant mortality rate (per 1000) 1998 Under five mortality rate (5q0), 1998–99 Total fertility rate, 1997 Childhood underweight (% < –2SD) 1998–99 Andhra Pradesh Assam Bihar* Gujarat Haryana Karnataka Kerala Madhya Pradesh* Maharashtra Orissa Punjab Rajasthan Tamil Nadu Uttar Pradesh* West Bengal INDIA 75.4 26.2 99.9 48.3 19.8 52.1 32.3 79.7 91.1 35.9 23.5 53.6 61.8 170.2 79.0 996.9 62 56 59 61 64 63 73 55 65 57 67 60 64 57 62 61 66 78 67 64 69 58 16 98 49 98 54 83 53 85 53 72 86 90 105 85 77 70 19 138 58 104 72 115 63 123 68 95 2.5 3.2 4.4 3.0 3.4 2.5 1.8 4.0 2.7 3.0 2.7 4.3 2.0 4.8 2.6 3.3 38 36 54 45 35 44 27 55 50 54 29 51 37 52 49 47 * This table refers to the entire states before new states were created in November 2001. Bihar became Bihar and Jharkhand, Madhya Pradesh became Madhya Pradesh and Chattisgarh, and Uttar Pradesh became Uttar Pradesh and Uttaranchal. Major states are considered as those states having a population of more than 15 million persons. Sources: Registrar General (1999); National Health and Family Welfare Survey-II (2000). Table 2. Positions of major Indian states in the health transition Position in transition States A. Late transition B. Mid transition Kerala 3.2 Tamil Nadu, Punjab, Maharashtra, 45.2 Karnataka, West Bengal, Andhra Pradesh, Haryana, Gujarat Assam, Bihar, Jharkhand, Orissa, 46.7 Rajasthan, Uttar Pradesh, Madhya Pradesh, Chattisgarh C. Early transition % of India’s population Infant mortality rate (per 1000) Under five mortality rate (5q0) Total fertility rate Child malnutrition rate (% < –2SD) <20 49–69 <20 58–86 <2.0 2.0–3.4 <30 29–50 3.0–4.8 36–54 67–98 90–138 Note: Major states (population more than 15 million) were ranked according to infant mortality rate, child mortality rate, total fertility rate, and child malnutrition rate. Sources: Registrar General (1998), IIPS (2000). Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 State 252 David H Peters be needed, besides a different mix of public health programmes. Some states have a recurring history of flooding, cyclones or earthquakes that requires special preparation and response by the health system. In addition to the differences in health outcomes described above, inequalities in health financing and health service use ought to be a major concern. As shown in Figure 1, the level of state spending on health is widely different, ranging from the equivalent of US$4 per capita in Kerala, Punjab and There are also large differences in levels of use of health services between the states. In 1995–96, public sector hospitalization rates were nearly 3 admissions per 1000 persons per year in Kerala, followed by 1.1 in Orissa and West Bengal, compared with 0.2 in Bihar and 0.4 in Uttar Pradesh (Mahal et al. 2001). Similar large differences exist when comparing nearly all types of public sector services, and even larger differences occur when examining the level and distribution of private sector health services (Peters et al. 2002). Of particular concern in the delivery of health services is the unequal way in which the poor are able to use public health resources. Mahal et al. (2001) have extensively documented Table 3. Local factors to consider at state level when prioritizing health systems choices Local factor Examples Lifestyle differences • • • • Poverty differentials Natural risks Physical environment Political outlook Social capital • • • • • • • • • • • • Public health management capacity • • Non-smoking tobacco use is 25 times greater in Orissa than in Haryana Smoking rates are 3.4 time greater in West Bengal than in Maharashtra Alcohol use is 5 times greater in Madhya Pradesh than in Haryana Large differences between northeast Karnataka and south Karnataka state, and in Maharashtra state between Mumbai and rural areas Per capita income is 3.8 times higher in Punjab than in Bihar Flooding in Ganges delta, drought in Rajasthan Different malaria patterns and interventions for rainforests, semi-arid deserts, and urban areas Cyclones in Orissa, Andhra Pradesh, and West Bengal Earthquakes in Gujarat and Uttaranchal Slums and pollution around mega cities Indoor air pollution from dirty fuel combustion in rural households Mountain isolation in Uttaranchal and Himachal Pradesh Communist and collectivist philosophies in Kerala and West Bengal Greater decentralization and stronger local governments in Kerala and Madhya Pradesh Stronger civil society organizations in some states: women’s microcredit groups in Kerala and Andhra Pradesh, NGOs in Kerala and Gujarat Different levels of public and private sector corruption: opinion polls rate Bihar and Uttar Pradesh as most corrupt states in India, Kerala and West Bengal as least corrupt Uneven state government management capacity, Tamil Nadu AIDS control outperforms other states Andhra Pradesh, Karnataka, Punjab and West Bengal have implemented major State Health Systems Development projects Sources: Peters et al. (2002), Transparency International (1998). Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 Other researchers have pointed out that the amount of decision space transferred from central government to local governments and institutions is an important factor in shaping local health programmes, as well as the local social and political organization (Bossert 1998; Atkinson et al. 2000). In India, the level of economic growth, the general management capacity of state governments and the sets of stakeholders involved will be major factors that influence policy choices and their impact. Kerala has an impressive history of public engagement and local level planning and management of public services despite political polarization between two ideologically opposed parties (Communist and Congress), whereas in other states (e.g. Uttar Pradesh), increased public participation on local political bodies is only recently being attempted. In explaining the large differences between health outcomes in Kerala and West Bengal, Nag (1985) pointed out that the states are very different societies, having different histories, leaders and priorities. She posits that a long history of emphasis on education and female empowerment have contributed to healthier behaviours and higher expectations of health services in Kerala, which in turn has led to better health outcomes. Tamil Nadu, to less than US$2 in Madhya Pradesh and Bihar (Peters et al. 2002). Interestingly, the level of central government spending across the states is quite similar, and does not reflect differences in health needs, performance of health systems or the amount of fiscal effort put in by the states. Overall, fiscal effort of central and state governments on health is quite low, accounting for less than 1% of GDP, placing India among the bottom quintile of countries (WHO 2001). Private spending on health, which accounts for about 80% of all spending on health in India, also differs enormously between states. One of the major problems with private spending is that it is predominantly paid outof-pocket on a fee-for-service basis. Nearly 40% of Indians who were hospitalized in 1995–96 fell into debt to pay for hospital expenditures, with nearly one-quarter falling below the poverty line as a result (Peters et al. 2002). There were also large differences between states for the risk of falling into poverty when hospitalized, ranging from 17% in Kerala to double that in Uttar Pradesh and Bihar (Peters et al. 2002). Health policy in India 253 Per capita health spending (Rs) 0 20 40 60 80 100 120 0 1000 2000 3000 4000 5000 6000 Kerala Punjab Tamil Nadu Maharashtra Assam Rajasthan Karnataka Gujarat West Bengal Haryana Orissa Uttar Pradesh Madhya Pradesh Bihar Per capita GDP (Rs) Per capita GDP Central health spending State health spending Figure 1. State-level per capita public spending on health and GDP, 1995–96 Sources: Based on Selvaraju (2000) and World Bank (2000b). large differences in health service utilization and the benefitincidence of public sector expenditure on health. Although the richest quintile of Indians consumed about three times as much of the public resources on health as the poorest quintile, there were large differences between states and types of services. In particular, four states (Kerala, Tamil Nadu, Gujarat and Maharashtra) had an equal or ‘pro-poor’ distribution of public resources, whereas all other states reflected ‘pro-rich’ distributions (Peters et al. 2002). After accounting for differences in levels of income, literacy and public health spending, the equality of public spending was the strongest predictive factor in determining state mortality and fertility rates, with pro-poor services being associated with better health outcomes (Peters et al. 2002). These findings suggest that at the very least, better targeting of public resources to the poor ought to be a priority for public health policy. Another important facet of health policy in India is the near neglect of the health needs of large urban slum populations. In the absence of a coherent public policy, the provision of health services to the growing number of migrant labourers, informal sector workers and the poor has been left to the local municipalities. There are large differences in the type of health care provided by municipalities. Whereas cities such as Mumbai and Ahmedabad have significant budgets for health and provide a wide range of services, most municipalities have budget deficits and have difficulty paying for staff salaries, leaving most curative health care to the private sector. Health policy process India uses a 5-year planning process to determine national goals and priorities for development investments. It is through this process that priorities for family planning, 19 centrally sponsored disease control programmes, and the expansion of primary care services to rural areas under the minimum needs programme have been articulated and implemented across the country. Despite the rhetoric to integrate programmes and strengthen local decision-making, the funding system of the plans has reinforced a series of parallel disease control programmes and a separation of health and family welfare programmes. It has also institutionalized a centrally-based rigid approach for planning of personnel and health facilities based on population norms that have little relationship to workload, presence of the private sector or local epidemiological considerations (World Bank 1997; Misra et al. 2002). In the last few years, there has been increasing concern to reform the health sector, and to do away with the existing Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 Andhra Pradesh 254 David H Peters A similar initiative was taken to revise the 1983 National Health Policy. Beginning in 1999, the Department of Health organized a number of consultations to define an agenda of national and regional policy research. Stakeholders included: central and state government officials (e.g. Ministry and Departments of Health, Finance, the Planning Commission, the Insurance Regulatory Development Authority), private sector provider organizations, health insurance companies, not-for profit providers, legal experts, academics, research groups, consumer organizations, medical associations and international agencies (including the World Bank, Department for International Development (UK), World Health Organization, European Union and others). While small working groups prepared the terms of reference, 14 Indian institutions were engaged to conduct research. The findings were discussed at a series of regional and national seminars, and 21 research reports have since been circulated in print and on the World Wide Web.3 Building on this research and further analysis, the Commission on Macroeconomics and Health also prepared a country report on health in India, producing a wide range of recommendations for health policy change (Misra et al. 2002). Findings from the studies helped to formulate a revised draft national health policy, which was distributed for public comment and has now been tabled in the parliament for approval (Ministry of Health and Family Welfare 2002). While these processes confirm the importance of India’s national policy and planning, the challenge for new policy approaches lies with the states’ ability to perform their own analysis and define and implement programmes based on their own priorities. A mapping of the political economy for health sector reform is beyond the scope of this article, but we do point out that each state has its own set of actors that will influence the policy processes in the state. How different states have dealt with the private sector is one example of divergent approaches and results. Recognizing the dominance of the private sector (both for-profit and non-profit providers), a few states have drafted legislation to regulate private hospitals (e.g. Delhi, Punjab), in some cases with the assistance of representatives of the private sector (e.g. Andhra Pradesh). Responding to this action, the central Ministry of Health and Family Welfare attempted to draft a model law for states. In large part, these approaches have followed an old pattern of placing the government as an inspection agent, and using physical standards of facilities as a basis for providing licenses or levying fines. Given the limited capacity of governments to enforce such laws, it is doubtful that such approaches can significantly improve quality of care, and instead may be misused for harassing private providers. Some states have taken a different approach, and have initiated dialogues between public and private sectors to develop a common agenda for action based on mutual trust. In Uttar Pradesh, this has led to a small forum on publicprivate partnership, and initial plans to work on issues of joint interest, such as ambulance services and different contracting arrangements. In Tamil Nadu, conflict between participants led to the dissolution of a forum for publicprivate partnerships on health (Muraleedharan 2001). In Mumbai, a wide range of largely private sector health providers continue to work together on quality assurance issues and have initiated a programme for accreditation (Nandraj 2001). In each location, the dynamics of local politics has yielded different approaches and different agendas. Health policy content The central government has important choices about how it uses its resources for issues of national importance, and how its relationships with the states should change in the health sector. A recent review of the Union Ministry of Health and Family Welfare noted that its role had never been formally defined, but that it has gone beyond that envisioned in the Constitution (Centre for Policy Research 1999). This has resulted in an overly centralized control of health and family welfare programmes, rigidity in planning for central programmes, and a diminution of policy-making ability and innovation at the state level. The Report recommended that the core functions of the central ministry be defined around a set of national policy, planning and monitoring responsibilities, while the allocation of resources and executive functions be delegated to state governments and fully autonomous organizations. As shown in Table 4, major questions for the central government in each of the areas of health systems discussed above involves a change in role. We suggest that the central government should be an organization that provides leadership, financing, oversight and facilitation to the states, while trying to counteract inequalities between states and vulnerable groups. The management capacity of the central health ministry may not be superior to many of the state ministries, but it should differentiate itself by focusing on how to demonstrate improved performance in national health priorities and state health systems, and by providing additional resources to strengthen state management capacity (e.g. through recruitment of skilled personnel from outside government). An important dilemma for the central Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 centrally driven approaches. Several committees and studies commissioned by the Ministry of Health and Family Welfare all recommended greater devolution of finances, decentralization of responsibilities, an emphasis on community participation and the greater integration of programme delivery, beginning with the re-integration of the Departments of Health and Family Welfare (Ministry of Health and Family Welfare 1993; Centre for Policy Research 1999). As a consequence of these inputs and other consultations, The National Population Policy 2000 was drafted, which emphasized crosssectoral strategies, decentralized planning and the involvement of the panchayati raj and community groups (Ministry of Health and Family Welfare 2000). Another new feature was the recognition that different states had different planning needs, leading to a focus on reducing fertility in five states with high fertility rates (Bihar, Madhya Pradesh, Orissa, Rajasthan and Uttar Pradesh).2 Although this is still largely a centrally driven initiative, it does represent a departure in becoming more state specific, and several states have now developed their own population policies, with some even preceding the national policy. Table 4. Current role of central government and major choices facing the central government and Indian states at different stages of the health transition Health system oversight Health financing Current central government • Set national policies roles • Develop national health laws • Regulate medical and dental education • Manage national medical library and national institutions for medical, nursing and public health training and research Service delivery ——————————————————————————————–————————– Public health services Outpatient curative care Inpatient care • Generate general taxation • Manage 19 Centrally revenues and provide Sponsored Schemes health funds to state • National information, through Plan budget education, and • Raise revenues from communications (IEC) external development in health assistance • Manage or oversee national public health institutions Whether to raise more • How to devolve centrally funds for health (e.g. sponsored schemes to through general revenues, states and local bodies to tobacco or alcohol taxes)? facilitate better Whether to use central implementation? funds to counteract inter- • How to intervene in very state health inequalities? poorly performing states Whether/how to regulate (e.g. Bihar) or states in and facilitate health special circumstances (e.g. insurance? Jammu and Kashmir)? How to design and • How to introduce and • How to build networks introduce health insurance expand programmes for with private providers? with universal coverage? heart disease, injuries, • Whether to reduce direct How to raise more mental health, and HIV? public provision, or be resources for health? more selective in services How to test financing provided (e.g. prenatal through patients rather care) or focus on than providers for priority backward areas? curative care? How to experiment with • alternative financing where there is large private sector? How to increase financing of priority public health programmes? How to strengthen the management of public sector finances in peripheral institutions? Manage national hospitals Provide resources for national programmes involving inpatient care (e.g. tuberculosis, kala azar) Whether/how to provide examples for how to reorganize large hospitals? Whether/how to give autonomy to national hospitals? Whether and how to provide incentives for development of provider networks? • Whether/how to strengthen publicly run hospitals serving rural areas? • How to use health insurance to improve hospital care? How to better inform and • Rejuvenate public facilities • empower people to live in backward areas or healthier (focus on preacross state? transition conditions) and • Whether/how to work with HIV? untrained practitioners? Health policy in India Central government choices • How to refocus on national • oversight issues, such as: promoting quality assurance in public and private sectors, national • level IEC, information on health system performance, drug quality control, • human resources for health? Late transition state choices • How to facilitate quality • assurance for public and private sectors? • How to measure and • disseminate performance of private and public • sectors? • Which types of partnership tools with private sector can be implemented? Early transition state choices • How to inform and • empower people to demand better health services? • How to bring public and • private sector actors together to work on common interests? • • Provide outpatient care at • national hospitals and • clinics • Provide resources for national programmes involving clinical care (e.g. reproductive and child health, tuberculosis, leprosy) • Provide materials and finances to districts for special health projects (e.g. Reproductive Child Health project) • Whether/how to develop • standards and stimulate accreditation and licensing? • • Whether to develop guidelines, training, and patient education • materials? How to put appropriate balance on primary, secondary, and tertiary care budgets? 255 Source: Peters et al. (2002). Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 256 David H Peters government is what to do in very poorly performing states. The weakest states suffer most from poor governance, civil unrest and weak political leadership, problems that are not fixed simply by technical solutions from a health ministry. Where state government services are severely dysfunctional, there may be a case for the centre to take temporary responsibility for the management of some health services, or to bring in other intermediaries (e.g. non-governmental organizations, international agencies) to supplement public sector delivery. Criteria for taking such action should be explicit and might cover worsening health outcomes, inadequate budgetary allocations for national priorities and major misuse of funds provided by the central government. All states have a need to strengthen their oversight of the health system, including finding ways to bring together public and private sector providers to improve overall quality and accountability of services. In states that are advanced in the health transition (e.g. Kerala and Goa), there is already a much higher demand for better quality health services, so there may be more scope to play a more active role in measuring and disclosing information about the performance of public and private sector providers. In states that are early in the health transition (e.g. Bihar and Madhya Pradesh), the demand for health services may be low, so that efforts may emphasize increasing demand, as well as improving management capacities in local institutions and promoting local public-private collaborations. Dreze and Sen (1995) have argued that public action is not equivalent to government action, so that in all states, there would be scope to encourage civic organizations and consumer groups to play a larger role in strengthening accountability of the health sector (Misra and Kalra 2000). Because of corruption, weak legal systems and the growth of private markets, we argue that there is every need to encourage consumer groups and public action to protect the interests of patients. Health financing is an area where large differences in policy priorities between the states are expected, even if they share long-term goals. All states share a need to increase revenues for health, but states well along in the health transition are already facing higher health care costs due to the change in burden of disease. These states have a more urgent need to develop risk-pooling mechanisms to diminish the risks of poverty due to hospital care, and to use group purchasing of health services in a way that can positively influence quality and efficiency. These states may be able to take advantage of greater administrative capacity to develop the systems for In the area of public health services, the states share a common need to place additional effort on HIV prevention and control, though the mix of interventions ought to be different, depending on where states are in the HIV epidemic. For other public health services, there are also clear differences between the states. States that are early in the health transition need to focus on improving quality and effective coverage of programmes for reproductive and child health, malnutrition, tuberculosis and, depending on their geography, malaria. Public health communications would need to concentrate on ways to inform and empower people to lead healthy lives and use health services appropriately when dealing with these conditions. For states that are further along the health transition, the bigger questions are when and how to introduce and expand programmes for changing behaviours that effect cardiovascular disease, injuries and mental health. National public health programmes in these areas run the risk of detracting states from their priorities. However, there may well be exceptions to this general rule, when states are struggling to respond to nationwide problems, such as HIV/AIDS or a coherent disease surveillance system. States may have compelling reasons for setting local priorities that are different from the broad patterns outlined in this article. For example, West Bengal (a mid-transition state) has the highest rates of smoking in India, and Orissa (an early transition state) has the highest rates of chewing tobacco (Peters et al. 2002). Because of the high level of health risk involved, these states may want to take steps to counter tobacco sales and use, even though the focus of the public sector may be on addressing communicable diseases and pregnancy-related conditions. Strategic choices for ambulatory care pose large political and operational difficulties for all Indian states. Because of the poor condition of public sector primary health facilities, all states must choose whether to target outpatient care in remote areas, or to spread their resources more evenly and thinly across the state. Since outpatient care is dominated by Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 Most important, however, is for the centre to enable the states to develop policies and programmes that best address their populations’ needs and demands. We focus on how two factors, position in the epidemiologic transition and capacity of the public sector, should influence the content of health policy in different states. Using the categories of states outlined in Table 2, we demonstrate which policy issues are more relevant to the different categories of states. We divide the policy issues into different types of health sector activities, namely health system oversight, health financing, and three types of service provision: public health services, outpatient care and inpatient care. quality assurance, health information and billing that are needed to implement such health insurance systems. Of course, considerable effort would be needed to develop and choose the best design for their health insurance schemes, including how the revenues would be collected, what package of services would be included, what type and number of risk pools would be involved, and how cross-subsidization would work. Finding a way to provide sufficient resources to adequately finance a fully integrated public delivery system may be an alternative to developing insurance systems, but it is unlikely that such resources would become available, that the large private sector that already exists could be convinced to work within an integrated public delivery framework, or that the public would have confidence in such a system. States that are earlier in the health transition will want to first expand financial management capacity in public sector facilities to improve the delivery of health services that tackle their ‘unfinished agenda’. In some situations, however, states might also experiment with risk pooling or financing through patients rather than providers, particularly in areas where there is a robust private sector. Health policy in India the private sector in all states, there are also important choices about what to do about the private sector: whether and how to collaborate with the private sector, and how to counteract the failures of the private market. More public purchasing of services from the private sector may be viable in those states where quality in the private sector is more assured, and government has the capacity to develop credible contracting systems. However, there may be political repercussions if governments are perceived as backing away from commitments to provide essential primary health care services. States with more robust governance and greater management capacity are better able to take on these types of challenges. Nonetheless, process considerations, such as the relationships that can be developed between key public and private sector actors, and the results of any experimentation are most likely to determine whether policy initiatives in these areas will be implemented successfully. Large urban municipalities represent another special case for policy-makers. Because of the mix of slums, migrant populations and wealthier classes, and the overlap of government agencies and private sector providers, urban areas form melting pots for a diverse range of health conditions and sets of actors. Although municipalities are not the focus of this article, it is clear that similar choices will be required as populations in cities undergo the health transition. The urban elite will be demanding better regulation of the private sector, while the large number of people migrating into slum housing will need authorities to focus on the delivery of essential public health services. In all large cities, however, there is a need to simplify the overlap and confusion of public providers employed by national, state and municipal governments. There is also a need to work more systematically with the private sectors, reduce harmful effects of pollution and crowding, and develop more extensive services for the urban poor. This will require the initiative of the larger individual municipalities, with the active support of both state and central governments. Conclusions Indian policy-makers are now facing a multitude of new challenges. Our analysis shows that some commonality is needed in the ways to address them. Most critically, there is a need to make the health system more pro-poor and client friendly, and to take better advantage of the private sector while counteracting the failures of the private market. Improving quality and accountability of health services are also important strategic themes, along with approaches that strengthen the position of ordinary citizens to manage their own health conditions and be better consumers of health services. These common themes lend support to the proposition that better lumping of health policy and strategy at the central level is warranted. At the central level, the command and control role of government is changing, and the Union Ministry of Health and Family Welfare needs to respond to these changes by adapting new roles. It needs to provide leadership in important areas of oversight of the national health system, particularly to identify priorities. The case for HIV prevention and control remains an important example where direct national support is needed because of uneven or inadequate responses by the states without central government involvement. Providing a framework for public-private relationships in the health sector is another area of national concern. The centre should also reinforce its role by focusing attention on sector performance and health outcomes, in part through the establishment of national and state benchmarks, and also by establishing rigorous, independent evaluations, and committing resources to build capacity in governments and other institutions for conducting operational research and evaluation. Tackling the critical constraints around human resources should also receive more attention at the centre. Public funds are used to train doctors who emigrate in large numbers, while an insufficient number of nurses, auxiliary nurse midwives and traditional birth attendants are provided with training. Language barriers prevent the easy movement of paramedical professionals across the country, and while most college graduates are from southern states, the greater needs are in the northern states. The location and quality of educational institutions needs to be considered if health manpower production is to address national priorities. More could also be done to encourage local initiatives in remote or poor settings, where it is difficult to attract health professionals, by supporting innovations in recruitment, payment, support systems or other rewards for workers in these areas. We also argue for a more explicit central role in addressing inequities between states. The central government may want to reconsider its approach of providing largely equal financing (on a per capita basis). An approach that more explicitly balances extra funding for more needy states, as well as for better performance in implementing national priorities, would be a good starting point. Increased national funding levels, in the form of block grants set aside for allocation Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 Choices for inpatient care are more closely related to strategies for health financing. The further along the health transition, the more important it is that states choose a method for providing insurance for catastrophic care. In some cases, this may mean shifting emphasis from public provision to public insurance of hospital care, but there are complementary reforms in the organization of inpatient care that could also be helpful. For example, strengthening networks of inpatient and outpatient facilities presents an opportunity to make health care more comprehensive. Taking management of public hospitals out of the public bureaucracy and providing them with more autonomy also has the potential to improve hospital performance (Pearson 2000). For states that are early in the health transition, these choices are limited because of governance problems, though the conditions in the hospitals may be just as bad, if not worse. It is probably most critical for governments to find an appropriate limit on the amount of public funding of tertiary care, particularly in relation to primary and first referral level care, and to take efforts to assure that publicly run hospitals are providing as good quality care as possible within their budget constraints. This is particularly important for hospitals in small towns and rural areas, where there are few alternatives to the public system. 257 258 David H Peters based on needs, performance and innovation, are some of the instruments available to the central government. Most of the official development assistance also comes through the national government, which highlights the central government’s role in leverage of health resources. By providing direction for the distribution of resources and health sector performance, the central government could more strategically use external assistance to strengthen its role as a financier and intermediary for the states. The biggest change that we propose at the central level is for a more concerted effort to facilitate state efforts, while decreasing the centre’s role as a manager of many national programmes. The centre would provide more opportunities for states to learn from each other, and spend more resources on research and providing information. Exchanging information between states on the development and implementation of reforms and special projects can do this. There now remains little reason to maintain a separate Department of Family Welfare in the central government. The fragmentation caused by such a split now outweighs the advantages it earlier brought in raising the importance of family planning. Indeed, there are few reasons to maintain a centrally managed reproductive and child health programme if the central government were able to concentrate on questions of broad resource allocation, provision of information and facilitating learning across states to ensure that these The centre may also have an enhanced role in providing technical leadership on health issues in areas where national coherence is necessary (e.g. standardization of tuberculosis care, standards for food and drug safety). However, there is no reason to assume that this role ought to be assumed by inhouse capacity of the central government, particularly when other tasks have prevented the central government from developing technical expertise (Centre for Policy Research 1999). If the central government were to play an enhanced role in providing technical leadership, it would need to do this by facilitating the gathering of national experts to deal with specific issues, rather than expecting to have any inhouse technical advantage. As we point out, public-private partnerships, consumer groups or independent organizations may be able to fill some of this gap in provision of technical leadership, potentially with the encouragement of the central and state governments. In this paper we also argue for more splitting of health policy approaches in India, a major departure from the past. More explicit and comprehensive state policies and strategies in health are needed now more than ever. States that are early in the health transition need to focus more attention and resources on addressing the unfinished agenda of the health transition. Much of this would need to be through strengthened public sector programmes, but also by soliciting greater collaboration with the private sector on these issues. States further along in the health transition have not yet faced up to their new challenges and need to develop public health programmes that address their dominant health conditions, as well as developing more efficient and less risky health financing systems. States that are mid-way along the health transition face the most difficult choices of when and how to address the new challenges of the health transition. Each state also has considerable inequities within the state, such as between urban and rural areas, and between tribal and non-tribal areas. State-specific strategies are particularly needed to deal with problems of inequities within their state. States that develop their own health and population policies can build greater ownership for their plans and programmes, and increase accountability to state electorates. However, there are risks in decentralization: politicians may pursue popular but ill-informed health priorities; technical policies may become, or remain, inconsistent for populations that move across states (important for areas such as tuberculosis and anti-retroviral therapy); and some national values, such as promoting equity, may get lost. Promoting a better informed public debate can help to counteract all this. Sharing experiences in innovations such as working with the private sector, alternative health financing systems, local innovation in developing human resources for health and enhancing the role for civil society organizations would contribute to a more open public debate. Building up evidence on what policies work would entail rigorous Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 Since the 1990s, the central government has enabled development assistance agencies such as the Department for International Development (United Kingdom), European Commission and United States Agency for International Development to work at the state level in the health sector. The largest state level projects have been the World Bankassisted State Health Systems Development Projects (SHDP). According to a mid-term review (World Bank 1999) and a more recent review of the SHDPs (World Bank 2002), most of the efforts have gone into developing state hospitals using a fairly standardized project design. This has resulted in improvements such as increased access to hospital care, better monitoring of utilization and reduction of hospital waste. However, the states have not developed comprehensive state policies and strategies, and the project components to develop capacity in policy, planning, management and other systems have been insufficient. Developing oversight capacity in the state public sector will likely be a long-term venture that goes beyond the lifespan of a typical project. Not only should donor assistance become more customized to the specific conditions of the states, it needs to extend the activities beyond the state government. During a time when other sectors (e.g. industry, power) in India have made significant changes, key actors in the health sector have only tinkered with change, maintained a limited understanding between the public and private sectors, and not brought about a vision for India’s health system. Supporting public debate, encouraging experimentation and expanding the role for communities and the private sector in shaping the directions of state health systems should be priority actions for governments, civil society organizations and international development agencies. areas remain a priority within states. It is possible that a more direct role in temporarily bailing out some states in crisis or those suffering from especially poor governance would still be warranted. Health policy in India evaluations by analysts both inside and outside government. To produce the quality and range of data that will be needed, India will also need to develop its proficiencies in the areas of health economics, management and regulation. The stage has been set for health reform in India. The context and processes used for health policy point towards new roles for central, state and local governments, and different issues to be addressed by them. An increasing role for citizens and greater innovation in dealing with the private sector are also warranted. Strategizing for reforms in the states and at the central level is now needed, along with implementation of ideas to reform the health system. If India’s economy continues to grow as now, if the myriads of health systems in India are able to learn from each other, and if equity is pursued with greater vigour, then there are huge opportunities for India to improve the health of all sections of its society. 1 Estimates based on India’s own official poverty lines indicate that there were 350 million poor in the mid-1990s. Notwithstanding the current debate over the precise level and trends of poverty in India, poverty is an enormous problem. 2 In November 2000, three of the states were split, bringing to seven the number of priority states. 3 These can be found at: http://wbln0018.worldbank.org/SAR/ India/HealthESW/AR/DocLib.nsf/ References Atkinson S, Medeiros RLR, Oliveira PHL, de Almeida RC. 2000. Going down to the local: incorporating social organisation and political culture into assessments of decentralised health care. Social Science and Medicine 51: 619–36. Bhore J, Amesur RA, Banerjee AC. 1946. Report of the Health Survey and Development Committee. Vol. I. Government of India, New Delhi. Bossert T. 1998. Analyzing the decentralization of health systems in developing countries: decision space, innovation and performance. Social Science and Medicine 46: 1513–27. Centre for Policy Research. 1999. Report on the Restructuring the Ministry of Health and Family Welfare. 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Country assistance strategy. Washington DC: The World Bank. World Bank. 2002. India State Health Systems Projects: Quality Enhancement Review Panel Report. Washington DC: Unpublished document. WHO. 1999. The World Health Report 1999: Making a difference. Geneva: World Health Organization. WHO. 2001. The World Health Report 2001. Mental Health: New Understanding, New Hope. Geneva: World Health Organization. WHO and UNICEF. 1978. Primary Health Care: Report on the International Conference on Primary Health Care, Alma Ata, USSR, 6–12 September, 1978. Geneva: World Health Organization. Acknowledgements We would like to recognize how our thinking has been influenced by many of the stakeholders that have been engaged in recent health Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 Endnotes 259 260 David H Peters policy debates in India. Indian researchers have been particularly influential, including those authoring papers on the related subjects: R Baru, S Chakraborty, G Chellaraj, R Durvasula, C Garg, R Kutty, A Mahal, P Mahapatra, B Misra, VR Muraleedharan, S Nandraj, K Prasad, R Priya, I Qadeer, KS Reddy, V Selvaraju, P Srivastava, AJ Syed, A Thekkuveetti and SK Verma. Many central and state health secretaries and staff have provided valuable insights, with RL Misra and R Chatterjee leading the way in documenting their thinking and that from other research. A Yazbeck, R Sharma, GNV Ramana, L Pritchett and A Wagstaff from the World Bank have also written extensively on these materials and policy debates. Representatives of numerous non-governmental organizations and international agencies have also generously provided us with their time, thoughts, and data. Gill Walt provided helpful comments on an earlier draft of this paper. We also appreciate the suggestions of two anonymous reviewers. At the time the studies were conducted, The World Bank (DHP), the Government of India (KSR), and the UK Department for International Development (RF) employed the authors. The opinions and interpretations offered in this paper are the responsibility of authors. David H Peters, MD, MPH, DrPH, FACPM, has worked as a primary care physician in northern Canada, conducted operational research on health systems in Africa, Asia, and the Caribbean, and worked as a Senior Health Specialist for the World Bank in Africa and South Asia. While living in New Delhi, India, he led a group of research organizations to study the question of what type of health system India should have. He is currently an Assistant Professor and Deputy Director for Academic Programs in the Department of International Health at Johns Hopkins Bloomberg School of Public Health. Robert Fryatt, MBBS, MD, MPH, MFPHM, MRCP, has worked as a general physician in the UK prior to working on public health programmes in East Nepal and training as a Public Health physician in the UK National Health Service, and completing his Medical Doctorate on the economics of TB Control in Nepal at the London School of Hygiene and Tropical Medicine. In India he worked for the UK Department for International Development as the Institutional and Health Systems Development Adviser and later as the Senior Health Adviser. He is currently working as a Policy Adviser to the World Health Organisation in Geneva on the ‘Country Focus’ Initiative. [Address: Department of Cooperation and Country Focus, External Relations and Governing Bodies, WHO, 20 Via Appia, CH-1211, Geneva 27, Switzerland. E-mail: [email protected]] Correspondence: David H Peters, Health Systems Program, Department of International Health, Room E8132, 615 N. Wolfe Street, Baltimore MD, 21205, USA. Tel: +1 410 502-5364; Fax: +1 410 6141419; e-mail: [email protected] Downloaded from http://heapol.oxfordjournals.org/ by guest on September 8, 2015 Biographies K Sujatha Rao, MA, MPA, belongs to the Indian Administrative Service. She worked as Director (Information, Education and Communications) and Director (International Health) in the Ministry of Health and Family Welfare, Government of India from 1988–93, and later as Secretary of the Department of Family Welfare in the Government of Andhra Pradesh. In 1998, she returned to the Government of India as Joint Secretary (International Health) in the Ministry of Health and Family Welfare. As focal point to WHO and health sector reform, she coordinated the sector reform studies that were taken up with assistance from the World Bank. She is currently on study leave at the Harvard School of Public Health, USA. As a Takemi Fellow she is examining the feasibility of financial risk protection for the poor in India. [Address: D-I/184 Satya Marg, Chanakyapuri, New Delhi –110021, India. E-mail: [email protected]]