5 Things To Know About India’s Healthcare System

5 Things To Know About India’s Healthcare System – For those living in urban areas, healthcare is merely a political issue. They argue that the country faces bigger challenges such as economic development, infrastructure, jobs, and border disputes with Pakistan.  The 2014 elections have presented India with a unique opportunity to take a fresh look at its healthcare landscape. Sanify Healthcare presents you 5 things to know about India’s healthcare system in India.

5 Things To Know About India's Healthcare System

Things You Should Know About India’s Healthcare System

Taking the current scenerio in view, we share some insights about India’s healthcare system:

Need for Effective Payment Mechanisms

Besides the rural-urban divide, another key driver of India’s healthcare landscape is the high out-of-pocket expenditure (roughly 70%). This means that most Indian patients pay for their hospital visits and doctors’ appointments with straight-up cash aftercare with no payment arrangements.  According to the World Bank and National Commission’s report on Macroeconomics, only 5% of Indians are covered by health insurance policies [3]. Such a low figure has resulted in a nascent health insurance market which is only available for the urban, middle and high-income populations. The good news is that the penetration of the health insurance market has been increasing over the years; it has been one of the fastest-growing segments of business in India. Coming to the regulatory side, the Indian government plays an important role in running several safety-net health insurance programmes for the high-risk population and actively regulates the private insurance markets. Currently, there are a handful of such programmes including the Community Health Insurance programmed for the population below poverty line.

Demand for Basic Primary Healthcare and Infrastructure

India faces a growing need to fix its basic health concerns in the areas of HIV, malaria, tuberculosis, and diarrhea. Additionally, children under five are born underweight and roughly 7% (compared to 0.8% in the US) of them die before their fifth birthday. [4] [5]. Sadly, only a small percentage of the population has access to quality sanitation, which further exacerbates some key concerns above. For primary healthcare, the Indian government spends only about 30% of the country’s total healthcare budget [6]. One way to solve this problem is to address the infrastructure issue… by standardizing diagnostic procedures, building rural clinics, and developing streamlined health IT systems, and improving efficiency. The need for skilled medical graduates continues to grow, especially in rural areas which fail to attract new graduates because of financial reasons.

Rural Versus Urban Divide

While the opportunity to enter the market is very ripe, India still spends only around 4.2% of its national GDP towards healthcare goods and services Additionally, there are wide gaps between the rural and urban populations in its healthcare system which worsen the problem. A staggering 70% of the population still lives in rural areas and has no or limited access to hospitals and clinics [3]. Consequently, the rural population mostly relies on alternative medicine and government programmes in rural health clinics. One such government programme is the National Urban Health Mission which pays individuals for healthcare premiums, in partnership with various local private partners, which have proven ineffective to date.

 Underdeveloped Medical Devices Sector

The medical devices sector is the smallest piece of India’s healthcare pie. However, it is one of the fastest-growing sectors in the country like the health insurance marketplace. Till date, the industry has faced a number of regulatory challenges which has prevented its growth and development. Recently, the government has been positive on clearing regulatory hurdles related to the import-export of medical devices and has set a few standards around clinical trials.

Growing Pharmaceutical Sector

According to the Indian Brand Equity Foundation (IBEF), India is the third-largest exporter of pharmaceutical products in terms of volume. Around 80% of the market is composed of generic low-cost drugs which seem to be the major driver of this industry. The increase in the ageing population, rising incomes of the middle class, and the development of primary care facilities are expected to shape the pharmaceutical industry in future. The government has already taken some liberal measures by allowing foreign direct investment in this area which has been a key driving force behind the growth of Indian pharma.


The healthcare system is taking a great direction towards betterment as government invests in quality infrastructure and pharmaceuticals industry. Anyone who want to invest in it can easily get greater benefits. I hope the article was helpful to you.


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