Writes to finance minister for subsidy, infrastructure status for health centres.
Health & Family Welfare Minister Ghulam Nabi Azad is learnt to have written to finance minister Pranab Mukherjee that hospitals and healthcare institutes catering to the poor and marginalised people should be the beneficiaries of the ‘infrastructure’ status and capital subsidy through viability gap funding.
The scheme was announced by the finance minister last week in Parliament, without making a distinction between urban and rural or rich and poor. Azad has sought a graded incentive scheme for the hospitals and healthcare centres for the same.
The final guidelines from the finance ministry, likely to be issued soon, may incorporate the health ministry’s views, an official said.
Mukherjee, replying to a discussion on the Union Budget, had stated that investment in education and health sectors has a high priority in the policy framework. Since there is a need to further accelerate the creation of infrastructure in this domain, he announced that capital stock in educational institutions and hospitals would be treated as infrastructure sub-sectors.
“Accordingly, capital investment for these sub-sectors will be eligible for the Viability Gap Funding Scheme of the Ministry of Finance,” the FM had said. The measures are meant to throw up new funding avenues for health and education sectors.
Azad says his ministry had strongly recommended according infrastructure status to the health sector. But reiterated that the health ministry proposal was focused on medical colleges, nursing colleges, hospitals and diagnostic centres in rural areas or non-megapolis cities with graded incentive scheme “subject to the conditions such as provisioning the attendant services/beds at concessional rates as part of the National Health Schemes/programmes”.
According to Azad, the proposal was made to ensure that “the private investment in health sector meets with the objective of providing affordable healthcare to our people, particularly the poor and the marginalized, and also in areas that are not adequately serviced by healthcare facilities”.
Azad has requested the FM for a consultation between officials in the finance and health ministries on the issue.
Earlier, the health ministry had pointed out that there are global instances, which show that private sector normally weakens the public sector performance and results in increasing the cost of care.
“To address such likely distortions, it is felt that such concessions may be extended only if they are willing to provide services either at administered prices or work with the government in implementing the national health schemes….,” the letter says.
Under the viability gap funding scheme of the finance ministry, the central government provides a grant to the project equivalent to the lowest bid for capital subsidy, but subject to a maximum of 20 per cent of the total project cost.
