Human Development

Achieving universal health coverage in India: Inefficiency is the problem, not money

  • Blog Post Date 19 December, 2017
  • Perspectives
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Kanchan Mukherjee

Tata Institute of Social Sciences

India has been widely criticised for having one of the world’s lowest public spending on health. In this article, Kanchan Mukherjee contends that even with this minimal expenditure it is possible to achieve universal health coverage. This is because money is not the issue; the crux of the problem is the inefficient way it is spent, which includes misplaced priorities and a lack of evidence-based decision-making.

India is a land of contrasts and its provision of healthcare is no different. While wealthier people living in urban areas have access to high quality healthcare services, a vast majority of people living in rural areas have very limited access to it (Das and Mohpal 2016).
India has been widely criticised for having one of the world’s lowest public spending on health (1.2% of GDP (gross domestic product)), but I think that even with this minimal expenditure it is still possible to achieve universal health coverage (UHC). India’s Ministry of Health has estimated that rolling out UHC will cost approximately $6.5 billion per year for four years (2015-2019). India’s current GDP is estimated at $2.25 trillion by the World Bank. Consequently, the cost of rolling out UHC is actually only 0.28% of India’s GDP and well within the country’s public health expenditure. As I see it, money is not the issue; the crux of the problem is the inefficient way it is spent, and unless inefficiency is tackled UHC will not be achieved. The key contributors to inefficiency include misplaced priorities and a lack of evidence-based decision-making.

Efficiency is key to moving towards UHC, and priority-setting is essential to getting the maximum value for the money spent. Unfortunately, too often in India we see decisions about healthcare provision and priorities being made without supporting evidence or evaluations of cost effectiveness. Take, for example, the decision by the central government in their budget to open renal dialysis centres in all district hospitals in India through a public-private partnership. This decision is neither evidence-based, nor have the cost implications been considered. Subsequent costing estimates have even suggested that the cost to implement this could work out to be more than the entire budget for the National Health Mission programme. It’s also worth considering the opportunity costs here. Wouldn’t prioritising screening programmes for the early detection of risk factors for renal disease (like hypertension or diabetes) have been a more cost-effective strategy?

UHC fundamentally means improved access to health services and improved health outcomes. However, central and state policies in India are too often fixated on financial risk protection and coming up with new health insurance packages. A health insurance card is useless to a person if the nearest health facility is 100 miles away (poor access) or if there are no trained healthcare workers to provide services (poor health outcomes). In both of these scenarios possessing a health insurance package doesn’t equal care coverage. It’s also worth noting that these insurance packages lead to public tax money being invested in private health insurance companies, rather than being put back into government funds, where it could be used, for example, to improve the primary healthcare infrastructure and healthcare workforce in rural areas.
Using data from the Global Burden of Disease study and a cost-benefit analysis done by the Copenhagen Consensus Centre, I previously calculated that there are seven smart targets that need to be prioritised to achieve UHC in India (Mukherjee 2016). These are:

  1. Reducing child undernutrition and chronic diseases
  2. Reducing the number of malaria infections
  3. Reducing the number of tuberculosis deaths
  4. Lowering the newborn mortality rate
  5. Increasing the number of childhood immunisations
  6. Improving access to family planning
  7. Reducing indoor air pollution

According to a cost-benefit analysis, the benefits of prioritising these smart targets are worth four times more than the cost.

There are also three key areas outside of the healthcare sector that India needs to invest in if it wishes to achieve UHC. These are women’s education, infrastructure, and nutrition.

Women’s education

In 2015, 3.7 million eligible girls were out of school, and in rural areas girls receive an average of fewer than four years of education in India (Jain et al. 2016). Unless India improves the status of women in society, their potential contribution towards improving their own health and the economy will remain untapped. By empowering and educating women, they’ll be able to make better decisions regarding their own health and their families’ health. And if broader access to education means that more women enter the workforce, then that can only be a good thing for the growth of India’s GDP.


Meanwhile, infrastructure development to improve rural transport, electricity, schools etc. will provide a stimulus for doctors and nurses to move to rural areas to work and it might also enable patients to access healthcare more easily (Chavan et al. 2015).


In India, 20% of children under five years of age suffer from wasting due to acute undernutrition. Forty three per cent of Indian children under five years are underweight and 48% are stunted due to chronic undernutrition. Investing in the production of good quality, healthy food and its allocation through the public distribution system will tackle undernutrition and minimise the risk of developing chronic non-communicable diseases, like diabetes, which are on the rise in India. Making healthy foods available through the Integrated Child Development Scheme (ICDS)1 centres, which are aimed at improving education and nutrition among pregnant and lactating women and children under six years, would be a good first step in this direction.

Priority-setting is inherently a selective approach and contradicts universalism. However, in the Indian context, this selective universalism is perhaps the only way to make UHC a reality. It is better to have resources that target particular needs based on evidence, rather than spreading government resources thinly without evidence in the name of universalism.

This article first appeared on the BMJ (British Medical Journal) Opinion:


  1. Integrated Child Development Services (ICDS) is a centrally-sponsored programme that aims to provide services to pre-school children in an integrated manner so as to ensure proper growth and development of children in rural, tribal and slum areas.

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