In the latest news, a comprehensive study on the Not-for-Profit Hospital Model in India was released by the NITI Aayog. The study is a significant step towards bridging the information gap about these institutions and solidifying policymaking in this field.
About NITI Aayog
NITI Aayog is an Indian government public policy think tank set up to achieve sustainable development goals through cooperative federalism. By involving the state governments of India in the economic policy-making process, it encourages a bottom-up approach. Established to replace the Planning Commission, its ex-officio chairman is the Prime Minister.
Major Findings of the Study
The study found that not-for-profit hospitals typically charge less than their for-profit counterparts. The charges levied by Rural Community Based Hospitals are lower, while those of Rural Cooperative Hospitals are similar to government hospitals.
Significantly, most not-for-profit hospitals have empaneled with State or Central Government Healthcare schemes. Their low cost of clinical care and reduced operational expenditure is facilitated by various strategies, such as workforce multitasking, in-house equipment manufacturing, etc. Most importantly, these hospitals focus emphatically on quality care, with most having some sort of accreditation for their services.
Persisting Challenges
Despite many advantages, not-for-profit hospitals face several challenges. Recruiting and retaining doctors and staff is a tough task for most hospitals. They also suffer from delayed reimbursements and long-pending amounts leading to financial strain and impacting operations. Many are reliant on external funding, philanthropy, grants for infrastructural expansion, new technology purchases, and advanced equipment. Additionally, high compliance burden related to regulations and quality standards present further challenges, especially for hospitals in remote areas.
Suggested Policy Interventions
To address these challenges, the study suggests short and long-term policy interventions, such as developing criteria to identify these hospitals and ranking them through a performance index. Tax exemptions for donations and membership fees can encourage the growth of these hospitals. The study also recommends leveraging the expertise of these hospitals in managing human resources with limited finance in remote areas.
About Not-for-Profit Hospitals
Private hospitals are mainly categorized into for-profit and not-for-profit hospitals. Not-for-profit hospitals, although accounting for merely 2.7% of in-patients in India, offer a cost-effective solution to the healthcare affordability issue. They do not aim to generate profits from their patient services. Instead, the surplus funds are reinvested into the hospital. These institutions are typically run by charitable organizations or non-profit corporations.
Significance and Potential of Not-for-Profit Hospitals
The infrastructure, services, and charges of not-for-profit hospitals are geared towards serving the underprivileged and unreached population groups. Besides providing curative healthcare, these hospitals also contribute to preventive healthcare, social reform, community engagement, and education. Despite their crucial role, the not-for-profit hospital sector has remained largely understudied.
Recent Initiatives in Health Sector
Several initiatives have been launched recently, indicating a positive trend in India’s health sector. Among them, the increased allocation for health in the Budget 2021, the PM Atmanirbhar Swasth Bharat Scheme, National Digital Health Mission, National Medical Commission (NMC) Act, 2019, Pradhan Mantri Bhartiya Janaushadhi Pariyojana, and Ayushman Bharat are noteworthy.