Budget 2018 - Putting Health Back on Track
Raising the exemption limit (for tax purpose) of deduction for health insurance and medical expenditure from Rs 30,000 per annum to Rs 50,000 per annum under Section 80D was also the need of the hour.
The announcement to give up to Rs 5 lakh per family annually for secondary and tertiary medical care for about 50 crore people in the country is not only a revolutionary decision but comes at a critical juncture also when there are increasing medical conditions and all diseases including the non-communicable ones rising at an unprecedented rate.
When implemented, this will be the largest medical reimbursement scheme anywhere in the world and will change many dynamics of the healthcare industry. There will be many more people coming forward for treatment who have hitherto avoided going to hospitals for lack of financial ability to avail treatment.
Social Ills Associated With Treatment Costs
It is not a hidden fact that many people are pushed into poverty due to illnesses since the medical insurance penetration has been traditionally low in the country. A lot of people even went to quacks or untrained doctors and centers for treatment of complex problems and ended up being fleeced without any change in their medical condition. Both secondary as well as tertiary healthcare have been included in the ambit of the new scheme which is welcome.
Devil Lies in Details
However, it has to be seen how the scheme will be actually implemented on ground and how the government will be able to provide the financial assistance to the needy patients timely without red tapism coming in the way. It is also to be seen as to what happens when there will more than 10 crore families, as the finance minister has announced, seek the financial assistance. It is also to be seen what will happen if there is a patient who has availed Rs 5 lakh assistance in one year and then needs more money the next year for continuing treatment but the 10-crore-family-threshold of the government is breached the next year. Will an eligible patient not get more assistance for ongoing treatment the next year? These are some of the questions that will be answered in the due course of time.
Challenges That Rs 5 lakh Per Family Assistance Throws
The initiative, although welcome, will give rise to another situation. So far many patients stayed away from hospitals because of monetary issues but with this massive scheme, there will be many more who will come to the hospitals and there is a good likelihood of shortage of resources in hospitals. Both the existing bed as well as staff capacity is already insufficient as hospitals are brimming with patients and are struggling to meet the demand. India has about 0.9 beds per 1,000 population- a far cry from global average of 2.9 beds, according to the World Health Statistics. When more people will come forward for treatment, the already abysmal scenario is likely to get worse.
The worst affected would be rural India. This scheme is most likely to benefit the lower stratum of the society, living mostly in rural areas. In India, bulk of the healthcare facilities are concentrated in urban areas with 72 percent of the rural population managing with just 33-34 percent of all hospitals beds in the country. This scheme may put humongous pressure on healthcare providers in the rural areas.
Shortage of Healthcare Professionals Gets partial Attention
There is acute shortage of healthcare professionals in the country and the government has rightly taken a note of it in Budget 2018. It has decided to set up 24 new Government Medical Colleges and Hospitals. However, these colleges may be inadequate to provide all the manpower requirements of the healthcare industry viz nurses and paramedics, apart from doctors. Government could have focused more on nurse training colleges and institutes as well. Nonetheless, it is a step in the right direction.
Raise In Tax Exemption Limits
Raising the exemption limit (for tax purpose) of deduction for health insurance and medical expenditure from Rs 30,000 per annum to Rs 50,000 per annum under Section 80D was also the need of the hour. Raising the exemption limit for deduction under Section 80DDB for senior and very senior citizens was also much needed and will provide relief to many old and elderly taxpayers.
Bridge Thus far
The Budget lived up to the expectation on many counts but many counts but there is no incentive in the Budget for construction of new hospitals. The government should have given some sops for setting up of new hospitals, especially in smaller cities which are hugely underserved. Patients and their relatives are forced to traveled long distances and come to metros for treatment.
The higher instances of taxes on medical devices and equipments have not been addressed in the Budget either. The healthcare providers are now contemplating passing on the higher burden of taxes to the patients. The Budget could have looked at these tax implications and given the healthcare industry the much needed relief.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house
Around The World