Price caps help check medical costs, bring relief to poor

NEW DELHI:The health sector saw major initiatives to bring down and cap prices of essential medicines through price control, coupled with moves to expand a network of cheaper drug dispensaries in the last three years.

The push for cheaper medicines and

medical

devices comes even as cost of medical care remains high with the government looking for ways to expand insurance cover and reduce out-of-pocket expenditure.

Official data shows prices of essential medicines have come down by over 50% in the last three years. Price control played a major role in enhancing savings on medicines, which constitute at least 40% of an household’s expenditure on health. Both health ministry and drug price regulator National Pharmaceutical Pricing Authority (NPPA) worked to cap prices of commonly used essential medicines. The health ministry ensured timely review of the National List of Essential Medicines, the basis for price capping and

NPPA

implemented price caps keeping a tight check on violations and non-compliance.

Apart from price capping, the government also worked on opening AMRIT and Jan Aushadhi stores to make generic drugs available at a discounted price. For effective implementation, the government has put in place procurement agencies to ensure availability of commonly prescribed drugs for cancer, hypertension and diabetes and increasing such stores. The flagship 84 AMRIT (Affordable Medicines and Reliable Implants through Treatment) outlets have dispensed medicines worth Rs 179 crore at just a cost of Rs 73 crore to 18, 71,000 consumers. There are plans to open 3,000 Jan Aushadhi stores by end of 2017.

At present, there are 1,320 such stores, up from 88 set up during the previous UPA regime. These stores sell over 500 medicines covering 23 therapeutic diseases and 150 health supplements. The government has also brought stents under price control, providing a major relief to patients suffering from heart disorders. Health minister J P Nadda has indicated that more expensive medical devices will be brought under price control. “It is a good beginning because health, which was never an issue, has now become one. While it has shown its intent to bring down prices of medicines and implants, there are cuts, commissions and other forms of medical corruption that need regulation,” says Dr Gurinder Grewal, former president, Punjab Medical Council.

The Modi government came to office with its manifesto making two significant promises on healthcare — reducing cost and health assurance. Despite price control reducing costs, overall medical bills remain a challenge as procedure costs continue to be high and insurance coverage is low. The ‘Health Protection Scheme’ which promised to bring all centrally run health insurance schemes under one roof has not taken off. The scheme, which promised a health cover of Rs 1 lakh per family for 40 crore people along with a top-up for senior citizens, awaits

Cabinet

approval. The scheme was to be rolled out from April this year.

Overall health insurance coverage witnessed a marked increase reaching 28.7% households in 2014-15 from 4.8% around 10 years ago. In fact, the penetration seems to be higher in rural areas, making healthcare more affordable and improving health indicators. The NFHS-4 data shows 29% households in rural India have at least one member covered by a health scheme or insurance, as compared to 28.2% in urban areas. “Inefficiencies in claim reimbursements as well as poor primary health or OPD coverage are main reasons why even insurance has drastically failed to address the rising out-of-pocket expenditure,” an expert said.