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Is NITI Aayog Even Thinking about Health?



The NITI Aayog has effectively stalled the finalisation and tabling of the National Health Policy 2015 in Parliament. The document, including the Parliamentary Standing Committee on Health and Family Welfare’s report, should be revived to put forth a concrete plan for transforming the healthcare system in India.

The National Democratic Alliance government put a Draft Health Policy in the public domain for discussion and debate towards the end of 2014. It also set up various sub-committees in the Ministry of Health to engage with each of the main sections of the policy document and also called for the general public to send in their suggestions. After several rounds of debates and discussions, various stakeholders submitted their suggestions. By mid-2015 a revised version of the Draft Health Policy 2015 was reportedly put together but not released in the public domain. Thereafter, it was leaked in certain newspapers that highlighted the following key features of the policy (Sethi 2015a):

(i) That 2.5% of the gross domestic product (GDP) as public health spending should be reached by 2020, of which 70% should be on primary healthcare.

(ii) That the per capita public spending on healthcare should be ₹3,800 at 2015 prices.

(iii) The centre would contribute 40% of the resources instead of its present 20% share and for this would raise resources through health cess and cess on health degrading goods like tobacco, alcohol, etc.

(iv) That the states would have to commit 8% of their total budget for health.

(v) That free drugs and diagnostics in all public health facilities would be available.

(vi) That all district hospitals would be converted into medical colleges.

(vii) That all healthcare facilities—infrastructure and human resources—would be as per the Indian Public Health Standards (IPHS) norms.

(viii) That financing all the above would be largely through a tax-based mechanism.

All the above was very much in line with the Twelfth Five Year Plan, including the High Level Expert Group (HLEG) report, and thus was really not something new and radical. Apparently the reporting on this issue did not go down well with the NITI Aayog that clarified its stance on the issue.

The NITI Aayog was against increasing investments on health and was not keen on improving the public health sector. They were not sympathetic to the idea of free medicines and diagnostics either. They said that they favoured a private sector and insurance-based health services model and that people need to pay or contribute to a sickness fund for accessing healthcare services. They went to the extent of calling free care a “chimera” (Sethi 2015b).

No Concrete Health Plan

The above is the only “thinking” that the National Think Tank seems to have done about the health sector in India which is in the public domain. Its two working papers on health in the public domain, (that too on the website and not on the NITI Aayog website working paper page) which are mere situational analyses of the health system and health financing in India, are the only official documents on health by NITI Aayog (2015a, 2015b).

Apart from this, the earlier health adviser to the NITI Aayog Rakesh Sarwal published an interesting paper (2015) which critically assesses the Central Government Health Scheme as a national model for Universal Health Coverage (UHC). He concluded that its cost, which is about ₹17,000 per family per year, is feasible provided the large dependence on the private sector is reduced and all resources of the public system and social insurance schemes are pooled with general health services. This would make it equitable across the board and the central government employees would not have an undue advantage and claim over the public health budget. Insurance was clearly not an option in his scheme of things—it was the Thailand model with its strong primary healthcare approach that he felt would be most appropriate for India. So apart from this, the NITI Aayog has as yet failed to put forth a concrete plan for transforming the healthcare system in India.

However, what the NITI Aayog has effectively done is to stall the finalisation and tabling of the National Health Policy 2015 in Parliament. The Ministry of Health and Family Welfare was keen to bring in the new health policy but the NITI Aayog expressed dissent and the policy was sent to the backburner.

Finance Commission’s Role

On top of all this, the Fourteenth Finance Commission’s (FFC) impact on state health (and other social sector) budgets became visible in the fund flows to states during 2015–16 (Ninety-third Report, 2016). The centre had drastically cut its grants in many central schemes of health, including the National Health Mission (NHM). States also witnessed huge fund flow problems because in 2014–15 the finance ministry had switched routing of funds from directly to the state health society to a mechanism which mandated routing through the treasury in the interest of transparency and accountability.

The states soon enough realised that the proportional increase in the divisible tax pool to 42%, that gave them a larger fiscal space to make their decisions was a chimera because the centre had responded by cutting plan grants, which for a number of states were a cut more than the gain they made through the new FFC formula (Centre for Budget and Governance Accountability 2016).

Role of Civil Society

The huge cuts seen in the 2015–16 and later in 2016–17 health (and other social sector) budgets across states brought back the debate on health within the public domain and reactivated various stakeholders. Recently, one such effort at pushing an alternate model of healthcare by the Foundation for Democratic Reforms (FDR) and Loksatta Party to the NITI Aayog put the attention back on the latter’s role. Since the NITI Aayog was not thinking about health and healthcare, others were trying to push them to do so.

The alternate presented by the FDR and Loksatta was one of outsourcing primary healthcare to private providers (family physicians) by paying them a fee per contact/person (Singh 2016). This they mistakenly identified as the United Kingdom’s National Health Service (NHS) model. The NHS is just the reverse—it insources independent providers into a contract with the NHS Trust, assigns the providers to families, pays them a fixed capitation amount per family. Most importantly the contracted family physicians are required to devote their working hours full time to the NHS and generally cannot continue their private practice. The local health authorities keep a strong oversight on their functioning and accountability.

The FDR and Loksatta’s presentation is not the first time civil society has presented an alternate plan. In the direction of UHC, the HLEG report commissioned by the Twelfth Plan had already made significant recommendations for incorporation in the plan. The HLEG benefited from discussions and debates that the Medico Friend Circle (MFC) has been engaging with since 2010 in its annual meets and in its bulletins. Of significance are the annual meets from 2010–13 and all the discussions on alternate universal access to healthcare can be found in the MFC Bulletins Nos 337–39, 342–50 and 352–54 (Bulletins of the Medico Friend Circle).

The MFC has debated the concept of UHC, looked at the experience of various countries, looked at the political economy context of health systems, analysed financing systems, provided calculations and costing for universal access healthcare, outlined service delivery systems, assessed possibilities of involving the private sector within a regulated framework, etc. So there is no dearth of literature on the UHC alternatives that should get the NITI Aayog to start thinking seriously about transforming healthcare in India.

Failure of the Twelfth Plan

On 27 April 2016, the Department-related Parliamentary Standing Committee on Health and Family Welfare released its 93rd Report on the Demands for Grants for the 2016–17 budget in which it has severely indicted the failure of the Twelfth Plan in making the entire quantum of plan resources originally proposed in the plan. The Twelfth Plan had proposed a total of ₹2,68,551 crore over the five years but the final allocation was drastically reduced to ₹1,25,117 crore or a mere 46.6% of the original planned allocation.

The report concludes that if the entire allocation of the Twelfth Plan was made available to the Ministry of Health and Family Welfare, it would have effectively strengthened district health systems, provided the free drugs and diagnostics mandated in the plan, implemented effectively the IPHS norms and would have facilitated the roll-out of the UHC, and most importantly it would have been on track towards reaching the goal of 2.5% of GDP for health. Even for the flagship programme, NHM, instead of the original outlay of ₹1,93,406 crore for the plan period, only ₹90,023 crore of final allocations have been made for the five years. This is a mere 46.5% of the original planned allocation (93rd Report, 2016).

This Parliamentary Committee report provides an excellent critique of the failures and deficits in the public health system and has made suggestions for immediate action by providing appropriate allocations for free drugs, diagnostics and dialysis, expediting the conversion of district hospitals to teaching hospitals, compulsory public service for all undergraduate and postgraduate doctors at public health centres and community health centres for a minimum of two years. It mandates that the centre’s share of the health budget should be at least 40% and all barriers to delays in fund flows from the centre to states should be removed so that implementation does not get affected.

With this report on the table, which provides excellent insights into the public healthcare system’s functioning and financing, it is also important that the National Health Policy 2015 be revived and tabled in Parliament. The National Health Policy 2015 would clearly support the findings of the Parliamentary Committee Report and provide a springboard and policy framework to contextualise the actions needed to transform the healthcare system in India towards provisioning of universal access. It will also bring back the debate on UHC in public domain and should provide adequate food for thought for the NITI Aayog.


Bulletins of the Medico Friend Circle, Pune: Medico Friend Circle,

Centre for Budget and Governance Accountability (2016): “Comparative Analysis of Priorities in State Budgets for 2015–16,” Understanding the Changes in India’s Fiscal Architecture, A Working Paper Series by CBGA, Working Paper No 1, February, papers/ state_budget_Analysis.pdf.

Department-related Parliamentary Standing Committee on Health and Family Welfare (2016): “Ninety-third Report on Demand for Grants 2016–17 (Demand no 42) of the Department of Health and Family Welfare, 27 April, New Delhi: Parliament of India, Rajya Sabha,….

NITI Aayog (2015a): “Health System in India: Bridging the Gap between Current Performance and Potential,” Working Paper Series 1, Paper No 1/2015, New Delhi: NITI Aayog (National Institute for Transforming India), Health Division, System_in_India.pdf.

— (2015b): “Increasing Financial Resources for Health,” Working Paper Series 1, Paper No 2/2015, New Delhi: NITI Aayog (National Institute for Transforming India), Health Division, forTheme9-Increasing% 20financial%20resources_0.pdf.

Sarwal, Rakesh (2015): “Reforming Central Government Health Scheme into ‘Universal Health Coverage’ Model,” National Medical Journal of India, Vol 28, No 1,

Sethi, Nitin (2015a): “Government to Hike Health Care Investment to 2.5% of GDP by 2020,” Business Standard, 19 August,….

— (2015b): “NITI Aayog against Free Health Care, Bats for More Private Sector Role,” Business Standard, 25 August,….

Singh, Jyotsna (2016): “NITI Aayog Meet Seeks Reforms in Public Healthcare System,” Livemint, 26 April, %ADmeet% ADseeks%ADreforms%ADin%ADpublic%ADhealthcare%ADsystem.html.

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