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Budget Proposals To Propel Health Sector

Allocation to health went up by around 10 per cent; Budget proposals push for developing health infrastructure in Tier II, Tier III towns including boosting Ayushman Bharat Scheme

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Health Minister Harsh Vardhan termed the Budget proposals for 2020-21 as pragmatic, visionary, progressive and a people’s budget, while the industry leaders appreciated the government for allocating Rs 69,000 crore to the health ministry, a 10 per cent increase over the last year’s allocation.

The highlights for the health sector, as envisaged in the Budget, includes a push to Ayushman Bharat Scheme, the development of health infrastructure in Tier II & Tier III cities, push for affordable medicines, the inclusion of 5 more diseases under Mission Indradhanush and the launch of a campaign to eliminate TB by 2025.

The finance minister in her second Budget speech emphasized on the expansion of the Pradhan Mantri-Ayushman Bharat Scheme, the world’s largest government-funded national health protection scheme. The allocation for it was inclusive of Rs 6,400 crore for Jan Arogya Yojana.

Currently, 20,000 hospitals have been empanelled under PM Ayushman Bharat Yojana. The scheme will focus on setting up and development of hospitals in Tier-II and Tier-III cities under the Public-private partnership (PPP) model. Even for hospitals without Ayushman empanelment would be included under the scheme.

Dr Raajiv Singhal, Group CEO of Care Hospitals suggested incorporating different healthcare-related schemes under this one umbrella of Ayushman Bharat Scheme. “It will encourage more private participation, including the big chain multi-speciality tertiary hospitals,” he said.   

The proceeds from the taxes on medical devices will be funding the vital health infrastructure in more aspirational districts, is one of the Budget proposals. “This will help in addressing the issues of capital requirement for Building healthcare infrastructure in Tier-I and Tier-II cities,” said Dr GSK Velu, Chairman & MD - Trivitron Healthcare.

The budget talks about health cess. “It will add to pricing pressures for the manufacturers and is unlikely to be popular with the foreign manufacturers,” said Sameer Sah, Partner, Khaitan & Co.  

According to Budget proposals, the government will also provide viability gap funding in 112 aspirational districts for the process. “It will create a robust health infrastructure especially in that areas especially to the weaker section,” said NATHEALTH President Dr H Sudarshan Ballal.  

The finance ministry outlined the government’s plan of targeting diseases with a preventive regime using Machine Learning and Artificial intelligence. The speech mentioned “TB Harega, Desh Jeetega” program where the government plans to launch a campaign committing to eliminating Tuberculosis by 2025. And to tackle the shortage of doctors in the country, FM proposed to attach a medical college to a district hospital via the PPP model.   

Another scheme pushed by the Government is “Jan Anushadhi Kendra Scheme”. This scheme will offer 2000 medicines and 300 surgical instruments in all districts by 2024. “On the same lines, the government needs to develop some mechanism that provides affordable diagnostics, which is taxed much higher than medical services,” said Suresh Vazirani, Chairman & Managing Director, Transasia – Erba Group.  

Aiming at 90 per cent immunization coverage of India and to sustain the same by the year 2020. Mission Indradhanush has been expanded to cover five more diseases apart from tuberculosis, meningitis, measles, Hepatitis B, tetanus, whooping cough, poliomyelitis, diphtheria, Hemophilus influenza, and Japanese encephalitis. “It will help to prevent diseases and reduce the unnecessary burden on healthcare spends,” said Dr Shankar Narang, COO, Paras Healthcare.  

Although experts believe India is struggling big-budget spending on healthcare as insurance coverage remains poor, the government has aimed at spending target of 2.5 per cent of GDP till 2025 as demanded by the health experts.


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Union Budget 2020 Union Budget 2020-21 healthcare
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