## Wednesday, February 21, 2007

### The health of the Indian people as opposed to the Indian public health system

In a comment on my posting on trickle-down economics', Suchi said:

Ajay, It's really very pleasing to see the improvement in health indicators in the third round of the NFHS. It's even more gratifying to be able to attribute the improvement to the high levels of economic growth in India. However, having said that I would also like to point out the lesson that's stored in this correlation for the Ministry of Health and Family Welfare. That is, the urgent need for the MOHFW to strengthen its public health programs.

I thought the lesson that flows from this evidence is the exact opposite.

I think it's important to distinguish between health-system and non-health-system factors that affect health outcomes. Economic growth helps people buy better food, more cleanliness and more education. These non-health-system factors have a huge impact on health outcomes. I think that many people who are in the field of health underestimate the importance of these mundane factors.

Next, we turn to health-system factors. These should be broken up into two groups: inputs purchased from the private sector and inputs obtained from the public sector. There is extensive evidence in India that people who have the choice of going to public sector health facilities choose to pay for private health services instead. The latter, once again, relies on economic growth.

So you have three pieces in the puzzle:

• Growth gives people the ability to buy food, cleanliness, education;
• Growth gives people the ability buy private health services;
• And then there is the public health system, with its own issues in a weak mapping from expenditures to services delivered.

Hence, I become uncomfortable when there is an identity between "the health of the public" and "expenditures on public health systems". Too many people, in my opinion, jump from the view that "it's nice to be healthy" to the view that "the government should spend more on a public sector health system". Similarly, in my opinion, too many people jump from a fact like "the maternal mortality rate went down" to the view "therefore the public health system is performing better". These leaps are not logically sound.

The trickle down effect of India's growth is certainly making it more possible for families to get better health care but, having said that, I would also like to direct our attention towards the millions of people whose health still depends on the effective functioning of the government's public health system.

You say ...our attention towards the millions of people whose health still depends on the effective functioning of the government's public health system. Okay, then let me understand: are you saying that for 85% of India's population, spending on public health programs as presently setup is irrelevant for health outcomes, and the public health system is only important for the 15% poor? That would be a more sound position, but then it again begs the question: are there better ways to spend public money in improving the health of poor people, than running a public sector health system? Maybe the best intervention to improve the health of poor people would be to give them vouchers to buy lunch every day. Maybe the best intervention is to setup a cash transfer system where poor people are paid Rs.X per month by the State and then left free to choose how they want to spread that between food / education / health / clothes / shelter - it may well be that such a strategy will do more for health than the present path.

I work for an organization that has just finished conducting a detailed analysis of maternal and childcare issues in the ten of the least developed districts of India. The data just started rolling in and it only substantiates my point about the pressing need for a better public health system. This is because, we found that while there are now a number of people that have the facilities to get better health services, there are many others that are either not as well informed, or lack the resources to get them. This results in many people turning up at the local government health centers and unless those centers become our first and most effective line of defense, we will not be able to achieve significant improvements in the health sector.

We will be very happy to read your data and the inferences thereof. My sense of the evidence is that there is a continual process of people defecting from public facilities to private facilities - both in education and in health. And when we see poor people showing up at public health facilities, maybe the best answer is 10% GDP growth so that they will soon be able to afford private health facilities. The best thing to do may well be to take Rs.10,000 crore out of the health budget and use it to build roads - this pays for 10,000 km of good quality two lane roads every year, which would surely do more for the health of the population than the existing public health system.

Once again, my main point is that we need to be hard-headed and meticulously rational in arguing our case. Given the poor effectiveness of public health provision in India, given the many forces at work which shape health, we need much more care with the logic and evidence so as to think straight. Speaking for me, the present state of logic and evidence backing the status quo on health in India simply does not persuade.

You say: unless those centers become our first and most effective line of defense, we will not be able to achieve significant improvements in the health sector. But look at the evidence. For the last 40 years atleast, government health centres and hospitals have gotten worse and worse. But in this period, significant improvements have come about in health outcomes. This clearly falsifies the unless' proposition.

I get very worried when you use the phrase "improvements in the health sector". Are you focused on prosperous health workers or a healthy population? If it's the latter, then you should be saying "improvements in the health of the population" and not "improvements in the health sector".

A few days ago I saw a public sector 10th-standard-pass ANM worker in a village in Rajsamand district in Rajasthan. She is paid Rs.11,000 a month - a bonanza for someone who has only passed the 10th. She has tenure and no incentive whatsoever to do any work since she can never be sacked, and gets her salary regardless of how few patients come to her. She is worse than the quacks that dot the countryside. The quacks are also 10th standard pass, but they don't have tenure and an above-market wage.

Additionally, we will need time to achieve the high levels of economic growth that can usher in a sea change in the health of our population, given our current issues with infrastructure and such. Like you mentioned in your article, people will first have to become rich, and then hopefully, they can get better medical attention. This can take a substantial amount of time to happen. However, the government currently has the resources to bring about a large-scale change in health indicators. Thus, it's important that the Government of India understands the urgency of the issue and makes appropriate amendments to its current public health practices. Your example of the European countries and the improvement in the health of their populations spurred by the high levels of growth in those nations is certainly useful in furthering the cause of greater economic growth in India, but we must realize that their governments have also put in place a strong and more effective public health system. In sum, we should and must appreciate the impact that economic growth is having on the health of our population, but that does not mean that the government can shy away from its responsibility of building a robust public health system.

The European public sector health systems came after high per capita GDP, not before. And, all over Europe, payments to public sector' health practitioners follow the patients. If customers choose to not come to a certain doctor, the government payments to this doctor do not take place. The European public sector health worker has better incentives to work than the Indian civil-servant health worker. When you advocate a European-style health system, you should be careful to advocate the full package-deal. A close examination of the European public health system is known to induce heightened skepticism in the Indian public health system.

You assert that government has a responsibility to build a robust public health system. Is this an axiom, a political belief? Or is it backed by adequate reasoning? Is a robust public health system' the means or the end? I think the end should be a healthy population' and not a robust public health system'. If we set course for a healthy population, a public health system may play a role, or it may not, and the public health system that actually caters to improved health of the population will surely look very different from the one that we presently have.

I'm all for public expenditures on public goods: which induce benefits which are diffused across the population - like programs on communicable disease. Or, it may be possible for a government to address a market failure in health services - but then the case needs to be made about what is that market failure, why a stated government intervention solves it, why this is the most cost-effective path for the government to proceed, and how it is incentive-compatible. So far, in India, such careful thinking hasn't particularly taken place. I'm very sceptical about the government producing the private goods of perambulatory care as in the WHO PHC framework, and particularly about the inept public health systems that don't translate money into outcomes, and are being abandoned by any citizen who can afford to.

You are asserting that `a robust public health system' is of essence to improving Indian health outcomes. This assertion has not been proven. Maybe we are better off without MOFHW, with lower tax rates, and higher GDP growth. Maybe we are better off without MOFHW, with this spending shifted to building roads, with unchanged tax rates and higher GDP growth. These questions need hard-headed analytical reasoning by health economists. I have not yet seen papers and reports showing such hard-headed analytical foundations supporting what is being done in the public sector in health in India today.

You should be loyal to the health of the people and not to the existing public health system, and demand rigorous logic and evidence: I believe such a path would lead you to very different positions.

1. "Maybe the best intervention is to setup a cash transfer system where poor people are paid Rs.X per month by the State and then left free to choose how they want to spread that between food / education / health / clothes / shelter."

I read an article by Andy Mukerjee, a Bloomberg columnist, who had the same idea.

I wonder how something like this could be brought about, and how much it would cost without crating nasty side effects such as, corruption during implementation, stoking illegal immigration, accounting for disparaties in costs of living within the country and so on

regards,
Patel

2. This is a very nice post, and I want to see how others react to this.

3. This is a very good blog. thought provoking.Please keep up the good work

P.Vasantharajan

4. I think you're points are sound but you're conflating medical care with public health, as many do. The latter should be used to label population services (vital registration, disease surveillance etc) which are true public goods.

Related to this post though:

Is Economic Growth Associated with Reduction in Child Under nutrition in India?

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