Tracing the History of the Modern Health Care Sector of India

Health Care

It is usually seen that countries follow one of three forms of health care provisioning. There are countries in which the state plays a central role in the financing, provisioning and administration of services but at the same time, private interests in the form of individual practices, hospitals and other supportive services coexist with them. There are some other countries where the state is the sole provider of medical care and no private interests are allowed. Finally, there are countries which largely rely on the market for provisioning of health care services. Countries like Sweden, Britain and India have experienced planned development of health services with the state playing an important role. In most other developed countries of the world, the state has financed medical care through public or private insurance schemes while the services are provided by private and voluntary medical institutions.

Indigenous systems like Ayurveda, Unani and Siddha largely dominated the medical care sector in India in the ancient and medieval period.These practices were largely the domain of individual practitioners who provided services for a price which was mostly paid in kind. Now, however, the number of people resorting to such methods has fallen in our country. The modern medical care sector in India is heavily influenced by the UK model of health care. The sector is also influenced by the US model of health care through the activities of medical and pharmaceutical multinational corporations. Privatisation of medical care in India is a complex phenomenon because the private sector has not grown independently of the public sector. Since Independence, the Indian state has been investing in infrastructure, training of medical and paramedical personnel and medical research. This has provided a base for the growth of the private sector and is therefore interrelated to the public sector at several levels. The problem is that the distribution of private institutions is skewed towards urban areas and is concentrated more in some states than others.

To understand the Indian healthcare system more clearly, we must first examine the healthcare of two nations which bear influence on it in this respect.

In the UK, the Industrial Revolution came in full force in the beginning of the 19th century. The mass migration to urban areas and lack of sanitation led to the growth of infectious diseases. The fear of chronic ill-health of the working population and the fear of disease in the minds of the affluent classes paved the way for public health legislation. The National Health Insurance Scheme was established in 1911. This scheme proved to be ineffective after the First Word War. Thus, the mooring of state intervention in health care was laid in the inter-war period and its fruition was seen with the rise of the welfare state after the Second World War. The National Health Service was then set up, relegating private practitioners to the shadows till the mid-1970s. With the growth of private insurance and hospital companies, the private market changed considerably in 1979. The 80s saw the rise of hospitals owned by large corporations, both British and American. The private sector made a comeback. The similarities between the Indian and the British health care system are palpable from this analysis.

In the USA, corporate medical care was essentially a development of the 1970s. While the 60s had seen the introduction of public insurance schemes like Medicare for the elderly and Medicaid for the poor, the 70s was marked by an economic recession which resulted in a cutback on public spending. The Reagan administration, which came to power in the 80s, held the view that healthcare was a marketable product and should be organised accordingly. Therefore, the emphasis was on cutting back all public spending on medical care and replacing it with a free market delivery system. The influence of the developments in the American medical sector on the Indian scenario can be seen in the involvement of multinational pharmaceutical as well as medical equipment industries. It can also be seen in the prominent role played by NRI doctors in investing in tertiary level care, some of which is corporately managed and in the announcement of the Indian government to offer 100% equity to foreign hospital companies interested in investing in India.

Although the state has played a central role in providing medical care in India, private interests were never curbed and as a result, they have grown over the years. A significant proportion of doctors are employed in the private sector and there has been a growth of private nursing homes and hospitals after the 70s. This was the period when concerted efforts were being made to woo private investments to the health sector by offering concessions for the import of high technology equipment and for NRIs to invest in industry and welfare sectors.

At the end, it is essential to give emphasis to the influence of other healthcare systems and at the same time keep in mind the unique aspects of our medical sector. Just like the Indian culture, the Indian medical system also has roots which represent its diversity and history.


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