This is exactly why #PMJAY is more than just another "scheme". Its quality, pricing, protocol, monitoring, and purchasing standards can have a multiplier effect on the entire health system, impacting the health of all Indians, well beyond the money that they directly spend.
The impact of these efforts will be further magnified if the insurance regulator (#IRDAI) and the Employees' State Insurance Corporation (#ESIC) include these standards in their own guidelines and regulations.
#IRDAI and #PMJAY (@AyushmanNHA) constituted a joint working group in March 2019 to discuss many of these issues. They have now published their reports which are worth a careful read and contain a number of far-reaching ideas: irdai.gov.in/ADMINCMS/cms/f…
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Professors Gregory Clark & Susan Wolcott (2003) analyse the Indian state level growth experience from 1878 to 2000 and find that there has been little or no convergence in terms of per-capita incomes between states even over such long periods.
They conclude that "encouraging migration of workers to high productivity areas within India is the only policy we know will improve overall income per capita" but find that current rates of migration are a fraction of those observed in Europe and US: faculty.econ.ucdavis.edu/faculty/gclark…
Imbert & Papp (2020) also find this, even though rural wages are on average 35% lower than in urban areas & urban costs are not large. They conclude that the main barriers are the "non-monetary costs of harsh living and working conditions in the city": sciencedirect.com/science/articl…
As they have in other sectors, we believe that better rules & regulations will help us in healthcare as well. Sadly, given patient-privacy issues, & the continuing need to empower the actual provider to "act-in-the-moment" without fear of reprisals, these are not effective tools.
The most powerful instrument of "control" is payments which impact incentives "on-average" and nudge providers and hospitals to act in the best interests of the community of patients that they serve. Insurance regulators & providers therefore have a bigger role in this.
Here is an example from Canada where insurance reimbursement practices are being tweaked discourage the prescribing of specified opioids: healthaffairs.org/doi/10.1377/hl…
Non Performing Assets (NPAs), particularly Gross NPAs, are an indicator of the in/ability of a bank to allocate credit in a manner that maximises growth and development in the economy.
Permitting banks to put-off recognition / disclosure of true asset quality so that they can continue to lend does not help growth but instead allows lower-quality institutions to continue to perform this function and to continue to hurt economy-wide growth and job-creation.
Imposition of full transparency of balance sheets through full disclosure of IndAS-compliant financials and of Stress-Test results allows resources to flow away from such banks and towards higher quality institutions and directly enhances economy-wide growth.
An important debate in these times has been the relationship between the strength of, and the funding allocated to, the country's health system and the mortality rate per million (population) due to COVID-19.
While it may be premature to attempt a full analysis at this time, the potential relationship and the policy-signals emanating from it may not be quite as straightforward, and the choice of the national COVID-19 response strategy may have a strong and independent bearing on it.
UK for example, has one of the most well-funded and best-performing health systems in the world, but some of its early policy choices may have resulted in a high mortality rate which the strong health system perhaps kept in check but could not prevent: newscientist.com/article/mg2463…
In many developing countries, perhaps because of the long shadow cast by historical choices, governments still view themselves in a corporate mould, focused on gathering revenues, on borrowing money, and on the operation of multiple schemes and departments with these resources.
They seem less comfortable in their governance role and in the use of several other tools such as their unique ability, to convene diverse interest groups & help build consensus, and to address failures brought on by information asymmetries & distorted preferences of consumers.
Nowhere is this more apparent than in the healthcare sector where almost the sole focus appears to be on the operation of tax-financed departments and schemes with little or no attention being paid to the fact that these represent but a small part of the whole.
Driven by the twin challenges of information symmetry and non-convex preferences, market forces almost always fail to generate Pareto-Optimal outcomes in healthcare markets.
One only has to look at the high and growing C-Section epidemic in high-income states of India (including in Government hospitals), and the low demand (and supply) for screening and hypertension management services, to be convinced of this.
Countries with an interest in getting closer to Pareto-Optimality use a number of, often coercive, measures such as restricting patient access to hospitals & doctors (France, UK, Thailand), & comprehensive price control (Switzerland, Germany, Japan) to address these challenges.