7 PM Editorial |In post-Covid world, growth of business must not be at expense of societal well-being| 27th June 2020

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In post-Covid world, growth of business must not be at expense of societal well-being.


COVID-19 has caused a healthcare crisis in India. Despite such a crisis, ethical concerns have arisen regarding the prices charged by hospitals for treatments and by pharmaceutical companies for medicines.

The fundamental question seems to be, how much qualifies as sufficient private gain while providing a public service? This question would always gain importance whenever investors want their investees to run their enterprise as a “business” rather than as a public service.

Issues related to healthcare industry during Covid-19
  • Exorbitant bills by private hospitals: Doctors prescribed tests and medicines that patients do not really need to increase the revenues of hospitals and sales of pharmaceutical companies.
    • Case Study: Price of admission at Delhi’s private hospitals
      With the rates of medical procedures not capped in Delhi, numerous examples of patients being slapped with ‘exorbitant’ bills by private hospitals have come to light. A kidney patient, infected by coronavirus was asked for an advance deposit of Rupees 5 lakhs by Sri Ganga Ram Hospital.
  • Over-pricing of pharmaceutical drugs: Prices of raw materials, also called active pharmaceutical ingredients (API), and basic chemicals used to manufacture Covid drugs have skyrocketed during Covid pandemic. This has led to manipulation of prices by intermediaries and pharmaceutical firms to ramp up their revenues.
  • Shortage of medical equipment: Covid-19 protective gears and medical equipment were in short numbers to meet the rising demand. Earlier, there was no domestic manufacturing of PPE in the country and almost all of them were imported.
  • Improper dumping of covid-19 infected bodies: Due to lack of infrastructure coupled with fear of infection and stigmatization, the corpses of Covid patients have not been cremated as per the guidelines. Bio-medical waste Management Rules, 2016 has seen blatant violations.
Reasons for brewing crisis in medical profession.

Three eminent social psychologists saw the crises in professions brewing in the 1990s with the accelerating advance of businesses into the domain of public goods.

In their book, Good Work—When Excellence and Ethics Meet, Howard Gardner, Mihaly Csikszentmihalyi and William Damon have written that they recognise the positive role that markets play in promoting competition among them. But, not all spheres are to be operated in the same way as commercial enterprises do, in the way suggested by the Adam Smith-Friedrich von Hayek-Milton Friedman view of the marketplace.

Medicine requires financial prudence, but the purpose of the profession should not be to achieve the greatest profit for shareholders of a health maintenance organisation. In the words of the French prime minister, Lionel Jospin, ‘We are not against market-based economy, but market-based society’”.

International examples that handled Covid-19 effectively
  • Resilient Public Health System:Countries with stronger public health systems, such as Vietnam, for example, seemed to have managed far better than those with large, and very well-equipped, private health systems, such as the USA.
  • Universal Social Security:Countries with universal social safety nets, like the Scandinavian countries, Japan, South Korea and Germany, seem to be managing the effects of the economic breakdown on the poorer sections of their populations much better than the countries without universal social security, like India.
  • South Korea’s 3T:South Korea’s 3T or “test, trace and treat” policy consists of robust testing to identify confirmed cases, tracing their contacts to prevent further spread, and treating those infected at the earliest possible stage.
How Covid-19 has revealed the deep fissures in the field of economics?

The ‘free market’ school of economics that has dominated public policy across the globe since the 1980’s failed to provide solutions during the Covid-19 Pandemic. During the pandemic, the needs of businesses in economic policy trumped the needs of needy human beings such as migrant labourers in India.

Thus, the profession of economics must be reoriented. Societal (and environmental) well-being must be the goal of economic policies, not the size of the GDP. Citizens’ “ease of living” must become more important than “ease of doing business”. The growth of businesses and the economy must not be allowed to harm societal and environmental well-being.

Measures to ensure that economies do not trump medical ethics.
  • Medical Professionals:Professionals are expected to maintain high ethical standards in their work and in their conduct.
  • Public and Private hospitals: Hospitals violating the rules must be penalised. Accessibility and affordability of hospitals during Covid-19 pandemic should be seen as a right of an individual.
  • Pharmaceutical companies:The pharmaceutical companies must not run on the principle that “the business of business must be only business”, which has become the dominant view since the 1990s.
  • Government:The government must cap the prices charged by private hospitals for treatment. They must ramp up production of critical protective gears crucial for fighting Covid-19.

The lockdowns following COVID-19 have caused many people to introspect about the purposes of their lives, and the purposes of the enterprises they serve. It has also provided an opportunity to reset the course of economies.

Business associations should utilise this opportunity to re-orient, transform and re-purpose their mission, vision and standards. The regulatory regime of government must be strengthened in order to keep greedy medical business associations under check. Only then, India can truly rise both in the ease of doing business index and ease of living index.



1.Critically analyse the role played by healthcare ecosystem as a whole comprising medical professionals, public and private hospitals, pharmaceutical firms and government in handling Covid-19 pandemic? (10 Marks)

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