Covid-19 crisis: Health care infra ranking for states expected soon

15th Finance Commission would likely recommend performance-based grants

In light of the Covid-19 pandemic, the Fifteenth Finance Commission (15th FC) is considering comparing and ranking states based on their public health care infrastructure and may recommend performance-based grants.

This move, if finalised, will make its way into the FC’s second report for fiscal years 2021-22 to 2025-26. The report is expected to be submitted on October 30.

The parameters include health care spending as a percentage of more or gross state domestic product, mortality rate, the ratio of doctors and nurses to the population, the number of clinics, hospitals, care centres, medical colleges and other such factors.

The states that lag on these parameters could also be encouraged to spend more through conditional grants, said a person aware of the deliberations within the FC.

“Historically, the health sector has not received the funding that it should be given. That does not happen because states would rather end up spending on populist or politically beneficial choices like farm loan waivers,” the person said.

Northern states like Bihar or Uttar Pradesh, the official said, have always spent less per capita compared to southern states, on the health sector. And as a whole, India is behind the western world on a number of healthcare parameters.

“The issue that we have to deal with is that revenue resources are limited and may continue to be so in the foreseeable future. You can’t spend on everything and the states would have to prioritise what they should spend on, whether to make up for the shortage of healthcare professionals or build more healthcare centres or such.”

The person said the final decision on health sector recommendations will depend on a high-level group set up by the FC.

The group had submitted a report to the FC last year, but revised it later in light of the pandemic. AIIMS Director Randeep Guleria, Devi Shetty of Narayana Healthcare and Naresh Trehan of Medanta are some of the big names in the health group.

In April, the Chairman of the 15th FC, N K Singh, had said the recommendations made for the health sector, in its report for 2020-21, would require a “fundamental rethink”.

“We have had discussions on whether the recommendations in the first report need to be revisited. What is clear is that there will need to be a fundamental rethink in the health sector recommendations in light of the Covid-19 pandemic,” he had said.

In its report for 2020-21, the FC had asked for increasing state capacity by building more hospitals and medical colleges. It had set certain targets for the Centre and state governments to be eligible for health grants which are supposed to be laid out in the second report. These grants may be substantially revised upwards.