One consequence of the pandemic has been a substantial increase in medical debt. As the economic disruption due to COVID-19 drives millions into poverty, bills for medical treatment are only exacerbating the crisis and prolonging families’ suffering.
Large out-of-pocket medical spending is an issue which predates the pandemic, despite government interventions such as Ayushman Bharat. The Government launched the health insurance scheme – in full, the Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) – in 2018, offering health insurance coverage to the economically vulnerable. Earlier this year, Prime Minister Narendra Modi hailed the scheme and other healthcare initiatives in a virtual address. However, reception of the initiative has been far from universally positive.
Last year, Dr Santanu Sen – former president of the Indian Medical Association (IMA) – critiqued the insurance-based model of the scheme. “The government, instead of giving money to the government hospitals, is giving money to third [parties] (i.e. insurance agencies),” he said. “Why? First they should provide money and infrastructure to their own hospitals. They say they provide insurance to fifty crore people but how do they decide who needs this service and what about the rest of the eighty crore population?” In the context of the pandemic, Duke University researchers claim the scheme has not “effectively improved access to care and financial risk protection.”
As such, the issue of medical debt among India’s poorest is still very much an issue and the pandemic has thrust it to the fore. As an Associated Press report notes, “costs of ICU [intensive care unit] hospitalisation for COVID-19 are equivalent to nearly sixteen months of work for a typical Indian day laborer or seven to ten months for salaried or self-employed workers.”
Economist Vivek Dehejia says that high levels of medical debt in India is attributable to the poor status of the country’s healthcare infrastructure. Low government spending on healthcare in the country is a long-standing issue and has resulted in what Dehejia describes as “a patchwork quilt of incomplete public insurance and a poor public health system. The pandemic has shown just how creaky and unsustainable these two things are.” Indeed, when the pandemic led to scenes of publicly-run health facilities overwhelmed by mounting cases, “the result [was] a suffering public health system, where the provision of care is often poor, prompting many to flock to private hospitals” – thereby accruing substantial amounts of medical debt.
Roughly two-thirds of Indians lack medical insurance. Meanwhile, the poverty level is rising as COVID-19 ousted 32 million from the middle class and witnessed an increase of 75 million people joining the ranks of the country’s impoverished. Medical debt is fuelling this trend. “If you’re looking at what pushes people into debt or poverty, the top two sources often are out-of-pocket health expenditure and catastrophic costs of treatment,” said Professor K. Srinath Reddy, president of the Public Health Foundation of India. Even before the pandemic, medical debt drove 55 million Indians into poverty.
Even when the pandemic abates, we will still witness long-term consequences. The spectre of so-called ‘long COVID’ looms large, with manifold health effects which may require long-term care in some cases. There will also continue to be the country’s complex dual burden of noncommunicable and communicable diseases. The pandemic serves as a teaching moment. The frailty of India’s healthcare system has been laid bare – and a significant course correction is needed if we are to safeguard Indians’ right to health without it coming at the expense of their financial security.
