Growth of Formal and Informal Private Healthcare Providers in India: Structural Changes and Implications

Abstract

This study analyses the changing nature of the growth of private healthcare providers and highlights whether they are cost-effective and fill health service deficiency gaps. Evidences show around 10.4 lakhs private health enterprises are providing a wide range of services consisting of hospitals, medical, clinics, dental, diagnostics, homoeopathic, unani, ayurvadic, nursing and social services. Its growth can be experienced since independence, while it has grown faster after 2000s - the liberalised phase of Indian healthcare sector. Growth phenomena has largely been urban centric, economical prosperous and/or areas/districts where public facilities already exist. Private sector has failed in mending the deficiency gaps in healthcare provision across districts, rural-urban regions and states. Over the period, small informal practitioners are disappearing while large-size formal providers are increasing. Indian private hospital sector is taking a corporatisation shape which is highly concentrated in only few districts of some states. Allopathic providers are on the high rise as compared to the AYUSH. A large number of practitioners are unregistered and unskilled (without formal degree). Over the period, private sector has overtaken healthcare provision and delivery market but services has not been cost-effective. This has resulted in high healthcare cost and out-of-pocket burden in the country.