A Policy Analysis of the Health Sector Reform Process in India

Dr. Rama Baru Associate Professor, JNU India Habitat Center, March 7th, 2003

A policy analysis of the HSR process in India

The overall objective of this study is to explore the perceptions and experiences of health sector reform at the national level It specifically explores the definition, content, process, and sustainability of the health sector reform process in India. It seeks to understand both the internal and external forces that are shaping the health sector reform process.

Definition of Health Sector Reform

The definition of health sector reform used in this study is that it is a fundamental rather than an incremental change, which is sustained rather than one-off, [and] purposive in nature (Cassels:1997). According to Cassels (1997) health sector reform includes:

Improving the performance of civil service Decentralisation of power and resources Improving function of national health ministries Broadening health financing mechanisms Introducing managed competition

Data Source: Interviews

Actor
Bilaterals (EEC, DfID, SIDA roundtable) World Bank

Numbers contacted 7
2

Numbers interviewed 7
2

Ministry of Health and Family Welfare Tamil Nadu state level policy makers and academics

6
3

3
2

Motivation for the Analyses of Health Sector Reforms

Health Sector reforms are bound to influence the provisioning, financing, manpower, drugs and technology in the health service system Reforms will have a bearing on the effectiveness of National Health Programmes. Reforms will also have an impact on the availability, accessibility, quality and cost of health services-both general and specifically for reproductive and child health

Questions Pursued in the Analyses

Varying definitions of health sector reform -Indian government and major donor agencies Motivation for reforms of different donor agencies and the government Content of health sector reforms Implications of HSR for health services delivery Sustainability of the reform process Implications for equity

Methodology
All who were involved in the health sector reform process were contacted and key persons were interviewed from the major multilateral and bilateral agencies and the Ministry of health and family welfare. The donor agencies included The World Bank, DFID, SIDA, and the European Commission

Methodology
Elements of HSR that got special emphasis during the nineties with loans/grants from multilateral and bilateral agencies were reviewed;

Loans to communicable disease control programmes with focus on specific diseases viz. tuberculosis, malaria and HIV/AIDs Loans for the Reproductive and Child Health programme Loans to state governments for the state health systems projects for primary, secondary and tertiary levels

Plurality of definitions
Health sector reform is nothing more than projects that have been put together and it is tied to loans from the World Bank. (Interview former Secretary of MOHFW May 2002). During negotiating for the loans, the Bank told us that unless we accepted conditionalities for power reform they would not give us loans for health. We told them that we did not want to be tied down by such conditionalities and would rather not get the loan. Then they came back to negotiate with us on the terms set by us. (Interview with senior official in the health ministry, Delhi, March 2002)

Plurality of definitions
A senior official of The World Bank views health reforms as a group of projects that includes communicable diseases, Reproductive and Child Health programme and Health Systems The motivation for health sector reform as seen by the World Bank is to promote economic efficiency, quality, reform of public sector (Interview with Senior Bank Official, The World Bank Delhi Office, March, 2002). .

Plurality of definitions
The European Commission on the other hand argues that health sector reform is nothing more than a mixed bag of donors, projects and the government of India. Overall there is a singular lack of vision among all these actors when it comes to health sector reform. (Interview with Senior Official, European Commisssion, Delhi office, March 2002). They consider the World Bank to be setting the agenda guided by some North American consultants to introduce privatisation and have designed the components of the health sector reform agenda for the country. (Interview with Sr. official, EC Delhi office,

Plurality of definitions
Some academics and researchers (based on recent studies) on health sector reforms regard them as largely driven by the World Bank, though accepted by the national government in order to get loans to overcome the fiscal crisis, without a corresponding vision of the national government. Some academics have pointed that it is the lack of a vision of health sector reform within the ministry that results in the identification of HSR with donor led initiatives (Interview with a senior health researcher, Chennai, April,2002).

Space for negotiation

According to the European Commission the government does have space for negotiations in terms of the programme content and the choice of technology. Space defined by vision, technical intellectual capacity of government officials and political will of state governments For example, user fees in Kerala and AP. The role of the bureaucrats has been a mixed picture with those who have a vision, some who collude with foreign agencies and others who want to pursue their own pet ideas ( Interview with Senior Official of the European Commission, Delhi, March 2002)

Space for negotiation

The bureaucrats from the health ministry opined that even though the World Bank was the major actor it did not determine the priorities for the country since the quantum of funding is small and not an additionality to the existing budget. Although the outlay is insignificant, a senior bureaucrat in the health ministry argued that, we negotiated with the World Bank based on our needs. There was no element in the disease control programme that was seen as unnecessary by the Indian government. (March, 2002) The only programme that was pushed by the World Bank was for HIV/AIDS but the other disease control programmes namely tuberculosis and malaria were seen as important internally and were endorsed by the Indian technocrats themselves. (ibid).

Space for Negotiation

At the state and central levels the push factor for taking loans is the fiscal crunch faced by the states. Given the poor state of finances, the state governments opt for loans and see it as a way of tiding over a financial crisis.

World Banks Review of the Health System Reform Project

The Banks image of itself as a provider of hardware and

infrastructure rather than a developer of human resources. Resistance from Indian counterparts to address systemic issues. Shortages of resources and effective managers. Focus on the public sector and on expanding the public health system Application of a single model to areas with very different characteristics.

Ownership of Reforms
The process of reform has been a top down with very little involvement from the community. The plans are made at the central and state levels with very little input from the communitys needs. As a result the ownership of reforms at the state and lower levels has been weak. Capacity weak at the state, districts levels Resistance of public sector doctors to give administrative powers to Panchayats Governance of public institutions unaddressed

Implications for equity in access and utilization

Privatization Corruption Rising cost of care, increasing cost of drugs, user fees

Sustainability of Reforms
Most state governments are not in a position to increase allocations In addition to sustaining these programmes, the states will have to also pay back the loans, which will only increase their financial burden. Frequent transfers of bureaucrats and technocrats as negatively affect the implementation of the reforms. Lack of civil service reforms Corruption within the health services as an additional impediment to sustainability of reforms Need for more effective donor coordination

Major Issues
Definitionincremental not fundamental The project approach to health sector reform spaces are available for negotiations at both the central and state levels with multilateral agencies. Since nearly all state governments are facing a fiscal crisis and health is not a high priority area of investment, most of them have been applying for loans to the Bank. The interviews suggest that the entire reform process is a top-down approach. There is little consultation with the personnel at different levels of the health

Major Issues
There is very little co-ordination among donors on health sector reform. There are situations where two or three donors are operating in the same state with their own priorities and agendas. This has raised the problems of duplication and adhocism when it comes to programme implementation. In the RCH programme the government has adopted the Rights Based Approach after ICPD but this has not been effectively transferred to the different levels of providers. New budget?