Why numbers tell only part of India's healthcare story; cost, access and outcome matter too

The numbers we rely on for assessing healthcare — out-of-pocket health expenditure, insurance coverage, doctor-to-patient ratio, or hospital bed-to-population ratio — can never quite capture the quality of care available to a patient. That is also probably a reason why, despite India being one of the preferred medical tourism destinations of the world, with a bunch of thousand-plus-bed-strength hospitals both in the private and public sector and a few upwardly mobile health indices, medical journal The Lancet ranked the country 145 out of 195 nations studied (in a report published in 2018) in terms of accessibility and quality of healthcare. The study reached the conclusion by estimating preventable fatalities caused by 32 different conditions.

Numbers tell a story, just not the whole one. India is far short of the World Health Organization (WHO)-recommended population-to-beds ratio of three beds per 1000 population — for the country, it is 1.6 per 1000 population, according to a 2021 World Bank estimate. Even after adding AYUSH doctors to the calculation (a questionable decision, according to many experts), India’s doctor-to-patient ratio stands at 1:811, according to a December 2025 Ministry of Health and Family Welfare communication, against the WHO standard of 1:1000. India’s public sector health spend is in the 1.4-1.8 per cent of the country’s gross domestic product (GDP) range, as per a Ministry of Finance statement last year, some distance away from the 2.5 per cent GDP “ideal”, but the total health spend is at 3.8 per cent. Which means the private sector spends more than double the government expenditure. But private enterprises need profits to sustain — therefore the citizen pays a premium on every penny that it spends in dispensing care.

In September, the foundation stone for businessman Gautam Adani's Rs 4000-crore Adani Arogya Mandir was laid. The 2000-bed hospital is being set up in New Town, West Bengal. Adani has said that half the beds will be reserved for ‘poor patients’.

But there is a systemic skew in Indian healthcare, with government facilities being the backbone of healthcare in rural and remote areas and in the primary care space while private rules the roost in urban areas and dominates the tertiary care segment. This makes integrated healthcare a challenge. Prevention becomes almost exclusively the government’s mandate while the private sector’s very business model is based on treating and not preventing diseases, explain those The Federal spoke to.

“While high-quality tertiary health care is needed to provide lifesaving, disability-prevention diagnostics and therapies in a timely manner, [with] their concentration in large metropolitan private hospitals is unlikely to serve the needs of the majority of the population. If such facilities are disconnected from primary care, which is the foundation of an effective health system, they cannot become part of an integrated healthcare architecture,” says Dr K Srinath Reddy, former president, Public Health Foundation of India, currently chair of the Centre for Universal Health Assurance at the Indian School of Public Policy.

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According to the report of the 15th Finance Commission (constituted in 2017), of India’s 18,99,228 hospital beds, 60 per cent are in the private sector. Hospital behemoths though, are not limited to the private sector. King George’s Medical University in Lucknow reportedly has 4500 beds, Government Medical College Kozhikode “has 3025” and the Rajiv Gandhi Government General Hospital in Chennai “has 2722”. But public sector hospitals are by no means a monolith. There is, at one end of the spectrum, the reportedly 3699-bedded All India Institute of Medical Sciences, Delhi, which has an annual budget of Rs 5500 crore, according to a statement by the Ministry of Health and Family Welfare earlier this year. Compare that with the reported Rs 4770 crore budget of the Pradhan Mantri Ayushman Bharat Health Infrastructure Mission, which was launched to strengthen public health infrastructure from primary to tertiary care levels across the country, and it is not difficult to understand why AIIMS is regarded as the epitome of excellence.

Says Dr VK Paul, former member (Health) NITI Aayog who has also spent years as a professor in AIIMS, “India needs more hospitals. Enhancing hospital beds to 2.0-2.5 per thousand population in the next decade is a reasonable goal. But it is not just about numbers. It is about where they come up. There is a need for a lot more investment, both by the public and the private sector, particularly in the Tier II and III cities. The real heavy lifting is being done by 25-50 bedded nursing homes in towns and cities alike. Equally important is compliance with evidence-backed clinical approach, protocol-driven treatment and outcomes. All of this information should be in the public domain. In addition, it is time that all private hospitals become a part of the Pradhan Mantri Jan Arogya Yogana (PMJAY) network that is the stepping stone for India’s universal health coverage goal.”

Meanwhile, more corporates are entering the healthcare fray, as are global private equity funds, underscoring the windfall profitability of the sector. Tied to the affordability question also is optimal use of drugs. Overmedication is a very real problem. Says corporate executive Mausumi Haldar (name changed), “My 80-year-old mother was recently admitted to a corporate hospital with swine flu. Looking through her medicines, I realised she had been prescribed three different kinds of cough syrups, both for dry and wet cough. I actually told the doctor: ‘Don’t you think her body will get confused whether to eject the mucus or keep it inside’! A bevvy of doctors charge hefty visits every day, but nobody has the time to read the other person’s notes.”

Trade margins on pharmaceutical products, markups on drugs and consumables charged by hospitals and inappropriate use of tests and technology are often cited as some of the other contributors to healthcare inflation. The last has become particularly important in the last decade or so as a slew of public insurance programmes have notionally increased health cover but the lens of “malpractice” prevention is guided entirely towards fraud detection rather than the clinical appropriateness of treatment delivered.

Take the case of journalist Nikhil Haldar (name changed on request), for example, who was rushed to the emergency of the East Delhi branch of a prominent private hospital chain some months back with acute abdominal pain. “At the time of discharge, when I was scrutinising the bill, I found that I had been charged for a urine test. I was very certain that I had not given a sample, so I contested the charge. After a long and tiring argument, the finance person said that since it is a part of the ‘package’, he could not deduct the money, but he would be happy to do the test if I would give them a sample right then. I refused. If I was being discharged without that report, then clearly the test was [clearly] unnecessary.”

The plight is worse for those from economically weaker sections.

Jyoti Kumari, who works as a domestic help in Delhi, was over the moon when the “Ayushman card”, as the PMJAY card is commonly known, allowed her to take her mother to a private hospital in Faridabad. “My mother had severe abdominal pain; they told us that she had a kidney issue, could even be cancer and did a whole lot of tests, including for cancer. But after a few days they told us that we would need to pay out of pocket as the card limit was exhausted. My mother was still in a lot of discomfort; they did not tell us what was wrong with her. We had to bring her back home.”

The matter of families exhausting insurance cover often without being any close to a patient being cured was also reportedly raised in Parliament last year, when Bharatiya Janata Party (BJP) member of Parliament (MP) Darshan Singh Choudhary, demanding tighter norms for the PMJAY, was quoted in the media as saying, “Once a patient is admitted, all his money vanishes, but full treatment does not happen”.

The pivot of the health system is the doctor whose clinical discretion and disinterested, objective decision-making is the key to optimal healthcare delivery. According to internal assessments made by hospital administrators and shared with The Federal, the average cost per day per bed that a standard hospital in a Tier I city incurs is in the Rs 20-30,000 range; for a hospital that does a lot of high-value interventions such as transplants, it can go up to Rs 40,000 per day per bed. Of this, between 55-60 per cent is manpower cost; the monthly salary of a star doctor can be anything between Rs 10-30 crore. There are also equipment costs, machine purchases, power and water bills to pay and sometimes loans to repay. There is a cap on bed charges that most insurance companies follow; the room rent cannot exceed 10 per cent of the total insurance value. This automatically imposes a ceiling on room rents.

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Much outrage has followed the analysis by the Maharashtra Food and Drug Administration (FDA) earlier this year that reportedly found that hospitals are charging up to 2841 per cent markups on consumables used. This is not new information. In 2017, in the wake of the deaths of two children in hospitals in the National Capital Region (NCR) when in each case the families were handed Rs 16 lakh bills, the National Pharmaceutical Pricing Authority undertook a similar exercise and had reportedly found over 1700 per cent markups. No action was taken and as the media attention moved from the issue, the analysis was quietly taken down from the NPPA website.

Nevertheless, Maharashtra FDA Commissioner Tukaram Mundhe’s proactive stance on the issue has restarted the conversation about trade margin rationalisation (TMR), with organisations such as Association of Indian Manufacturers of Medical Devices (AiMed) reportedly advocating for TMR during a meeting with the department of pharmaceuticals last month.

Much to the chagrin of the industry, a maximum limit of 30 per cent trade margin has meanwhile been imposed on cancer drugs even as the government of India is figuring out a reply to the Supreme Court’s question last month about why all essential drugs and medical products cannot have a trade margin cap.

“There is a cost involved for the hospital in delivering care to the patient, which remains somewhat similar between public hospitals, trust-run hospitals and private for-profit hospitals. For example, this ranges between Rs 20,000 to 30,000 per patient bed day in a tertiary care hospital in a Tier 1 city. (For a patient in the ICU it will probably be 50 per cent-100 per cent more on average.) This is paid for either by public money or insurance or out of pocket. Based on insurance payment models, only 1/2 to 2/3rd of the costs are generated from room charges, doctors' fees, etc. The rest is generated from some degree of markup on drugs and consumables. This markup is what probably differentiates acceptable surplus from profiteering,” says Dr Sumit Ray, medical director, Holy Family Hospital and a strong voice in favour of ethical medicine.

There are also larger ecosystem factors that have made the doctor more vulnerable; rising cost of medical education has meant that many young doctors are now entering the system with a substantial educational loan; they often prefer the security of a monthly salary instead of the earlier model of consultancy, which meant that the doctor charged a fee for their services and paid the hospital a part of that money as a sort of “rent” for using those premises. That model gave them much more operational independence, unlike the salary model where they have “targets” to meet like in any other corporate job — targets of surgeries, tests, interventions and admissions.

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Another structural fallacy in the medical system is the fact that while professional rules debar a doctor from advertising their services, there is no such restriction for a corporate hospital, even though it is far more overtly a profit-making enterprise than an individual doctor. Hospitals advertise new equipment, new premises, “smart” beds and even new doctor “acquisitions”. Business assets are meant to be monetised, so when a hospital acquires the latest MRI machine, it purportedly comes with strings attached for doctors; “use it, whether it is needed or not”. Take the example of proton beam radiotherapy, which is usually advised for paediatric tumours because of its precision. It ensures surrounding areas of an already small brain are not damaged by the radiation. A former AIIMS oncologist now in the private sector compares using PBR in adults to “using a cannon to kill a housefly”. It is about 90 per cent more costly than regular radiotherapy.

Healthcare is a recurring subject in Indian public discourse. As the work picks up on the upcoming Adani facility in West Bengal, perhaps it is time to look beyond the numbers against which the subject is measured and evaluate the quality of care offered.