Niti Aayog’s PPP healthcare model


Private healthcare in India usually offers quality service but is often expensive and largely unregulated.


  • Niti Aayog and Union health ministry have put forward a public-private partnership (PPP) model for the management of non-communicable diseases in tier 2 and 3 cities across the country, with World Bank will be serving as a technical partner.
  • The private hospitals said some provisions need to be clarified. This include the rates that can be charged to patient who aren’t covered by National Health Protection (NHPS), Rashtriya Swasthya Bima Yojana (RSBY), Central Government Health Scheme (CGHS), or state insurance schemes.
  • There is shortage of infrastructure and human resources, 72% of the rural population and 79% of those living in urban areas have sought access to healthcare in the private sector.

What is a private hospital?

A private hospital is one which is owned and governed by a person or many people who are managing the whole finances on their own. A public hospital, on the other hand, is completely and entirely run by the government’s funding and money.

Advantages of private hospitals:

  • The fees of a private hospital are higher as compared to public hospital.
  • In public hospitals, the services are mostly free, waiting time is longer. In private hospitals, waiting time is less.
  • Private hospitals have the most modern equipment and the equipment last longer too. Public hospitals have good equipment, but due to the extreme use they can get damaged more often than those in a private hospital.
  • Number of patients per doctor is higher in public hospitals. It is not good as the attention is too much divided. It is also exhausting of the doctor.

Disadvantages of private hospitals:

  • The fees of a private hospital are higher than that of public hospital. Most of the time public hospitals offer their services free of charge or for reduced rates.
  • Private hospitals are a kind of a business they earn a profit like any other business. However, public hospitals run for the health of their patients, and not to earn

Loopholes of private healthcare in India:

  • Private healthcare of India usually offers quality service but is often expensive and largely unregulated.
  • Healthcare infrastructure is insufficient to cater to the needs of all its residents.
  • In India there is low health spending as compared to other countries. India has little to show for the slightly more than 1% of its gross domestic product (GDP) that it spends on healthcare.
  • Countries that have robust public health system spend much more for example Canada and the UK spends 8% of their GDP on healthcare.
  • The national health policy notes “growing incidences of catastrophic expenditure due to healthcare costs, which are presently estimated to be one of the major contributors to poverty”.
  • The Central Government Health Scheme (CGHS) has existed for decades and has been emulated by several states, which have floated similar schemes that discriminate between those who are employed by the state and those who are not. This is a violation of the principles of justice, and has not been notified by policymakers as they are the first among equals to benefit from such policies.
  • A grave impact of the CGHS and similar plans on public health is that India’s ruling elite do not have an incentive to improve the system as they would never use it.
  • India has set itself an unambitious target of 2.5% of GDP for distant 2025.
  • The Niti Aayog said that despite there being ‘concerted efforts’ to establish services to tackle non-communicable diseases, the system remains constrained.
  • There is lack of infrastructure and human resources in healthcare.
  • The private sector dominates healthcare delivery across the country, a majority of the population living below the poverty line (BPL)- the ability to spend Rs 47 per day in urban areas and Rs 32 per day in rural areas-continues to rely on the under-financed and short-staffed sector for its healthcare needs, as a result of which these remain unmet.
  • The majority of private healthcare professionals happen to be concentrated in urban areas where consumers have higher paying power, leaving rural areas underserved.
  • India mostly compares with China and US in the number of hospital beds and nurses. The country is 81 per cent short of specialists at rural community health centers (CHCs), and the private sector accounts for 63 per cent of hospital beds, according to government health and family welfare statistics.

Suggestions to improve healthcare in India:

  • There is need to develop public-private partnership (PPP) model in healthcare.
  • There is need to improve deplorable state of healthcare services for India’s 1.3 billion people
  • The government needs to be mindful of the fact that implementation holds the key to universalization of such schemes.
  • The most logical solution to enact a change would be to invest in public sector infrastructure and human resources instead of pushing the entire population towards the private sector.
  • The national health policy 2017 advocates financial and non-incentives for encouraging the private sector participation.
  • The policy also emphasized private sector collaboration for strategic purchasing, capacity building, skill development programmes, awareness generation, and developing sustainable network for community to strengthen health services.

India’s national health policy:

  • The national health policy seeks to provide “free, comprehensive primary healthcare services for all aspects of reproductive, maternal, child and adolescent health and for the most prevalent communicable, non-communicable and occupational disease in the population”.
  • The policy recommends “strategic purchase of secondary and tertiary care services as short-term measures”, but not the services people would pay for.
  • It supports government schemes which provide preferential care to government employees in the present and future.
  • National Heath Policy, 2017 approved by the government focus on Preventive and Promotive Health Care and Universal access to good quality health care services.
  • The policy seeks to reach everyone in a comprehensive integrated manner to move towards wellness.
  • The objective of policy is to deliver quality health care services to all at a affordable cost.
  • The policy looks at problems and solutions in a comprehensive way with private sector as strategic partners.
  • It seeks to promote quality of care; focus is on emerging disease and investment in promotive and preventive healthcare.
  • The policy is patient centric and quality driven. It addresses health security and make in India for drugs and devices.
  • The Policy proposes free drugs, free diagnostics and free emergency care services in all public hospitals.


  • Low spending on heath is a major factor of governments and their employees being shielded from policies meant for the common man.
  • Countries that have done well in providing quality care have one system for all. Therefore, there is need to boost spending on healthcare in India. The National Health Policy, 2017 advocates a positive and proactive engagement with the private sector for critical gap filling towards achieving national goals.
  • Economists such as Adam Smith and Amartya Sen have focused on justice as equally as economics-the two being inseparable, since without justice, economies is merely budgeting devoid of ethics.
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