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Budget 2020: What does the industry want?

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To boost the startup economy, we expect the government to announce further tax concessions

Praveshh Gaur, Founder and Director, Srauta Wellness

As a wellness startup, we have been benefitted from the government’s Make In India initiative and other policies for startups. However, since there are significant gaps, we hope that Budget 2020 will address these. To boost the startup economy, we expect the government to announce further tax concessions for at least three years and increase the loan availability under Mudra and other such platforms. Given that India has become the hub of medical and wellness tourism, some provisions for further encouraging players in this segment are required in the Budget. There remain significant complications in the form of bureaucratic red tape which is also turning out to be a deterrent for new ventures in the healthcare and wellness sector which hopefully the government will address in the Budget. Steps need to be taken which can improve the ease of doing business in the country. To boost the economy further and increase consumption, some reforms in GST and personal income tax would be welcome.

Steps should be taken to increase the budgetary allocation to healthcare and promote medical tourism

Dr Karnika Tiwari, Obstetrician & Gynecologist, Motherland Hospital

The healthcare sector is looking for some promising announcements in Budget 2020. As a healthcare provider, we expect measures from the government to help widen access to affordable and quality healthcare to the margins of society. The Ayushman Bharat scheme has made significant inroads but gaps remain in primary and secondary healthcare, which must be addressed. The Finance Minister must increase the budgetary allocation to healthcare and take steps to promote medical tourism as well. Private hospitals like ours would be incentivised if the government makes some provisions to lower taxes and improve FDI norms. There is also a shortage of specialists which can be addressed by announcing increased seats in medical colleges or setting up new colleges.

There is a need to increase expenditure in public health

Deepak Sahni, CEO and Founder, Healthians

One of the most avidly awaited reforms for the healthcare sector is an increase in public health expenditure. Currently, it is around 1 per cent of the GDP which is way below the global average. The healthcare system in the country needs an overhaul, with a special focus on improving primary healthcare facilities in rural areas.

Also, with the rise in lifestyle diseases, the preventive healthcare market is expected to grow rapidly. Therefore, introducing a regulatory framework to govern the diagnostics market would go a long way in removing differential pricing and quality issues that persist in the sector. Moreover, including diagnostics under the insurance ambit and increasing tax exemption ceilings under Section 80D towards the cost of preventive check-ups can directly reduce the out of pocket expenses for individuals.

The government should ease the rules and regulations for establishing more medical teaching and training institutions

Dr Azad Moopen-Founder Chairman & Managing Director, Aster DM Healthcare

The Indian Budget should focus on increasing public spending on healthcare, considering India’s demographics, growing population and increasing disease burden. The Budget of 2019-20 saw Rs 62,398-crore outlay for the healthcare sector which was just 1 per cent of GDP. This should be increased to 2.5 per cent or around Rs 150,000 crore to drive the health sector fast forward. Along with the private spend of 1.5 per cent, the total GDP per cent shall go to an acceptable 4 per cent. In developed countries, it is 10 per cent and in the US it is 18 per cent of the GDP. This will help in making healthcare accessible to marginalised populations.

There is a requirement for a viability gap funding by the government for smaller hospitals in Tier II and III cities by the government to increase the provider base for Ayushman Bharat. There is also a requirement for increasing the package rates of Ayushman Bharat for more hospitals to take this up and make the programme a success.

Focus on increasing the number of healthcare professionals as the doctor: patient ratio is 1:1,445 against the WHO recommended 1:1,000. The government should ease the rules and regulations for establishing more medical teaching and training institutions to produce more medical professionals to fill the gap. The recent decision to allow medical colleges by joint-venture between trusts and companies is a welcome step with the PPP model attached to government hospitals. The establishment of National Medical Commission (NMC) aims to address the skill gaps but more clarity on increasing UG and PG seats should be brought in.

The government should give a boost to digital healthcare to increase accessibility. Although the National Digital Health Blueprint (NDHB) is a step in the right direction, there needs to be further action and investment for developing infrastructure for electronic health records, for data portability, privacy and security. Telemedicine connectivity between the primary health centres, taluk hospitals, district hospitals and medical colleges must be increased to provide expert opinion in the peripheral centres.

Compulsory rural service for two years after MBBS and PG doctors and other para-medical graduates with higher pay scales supported by government should be rolled out to get more doctors to the rural areas.

Major reforms and investments to improve the quality of healthcare in smaller towns and rural areas

The primary expectation would be to see policies that fulfil the government’s vision of affordable healthcare. Higher spends on healthcare will be essential to provide good quality primary healthcare in rural areas. Major reforms and investments are expected that would improve the quality of healthcare drastically in smaller towns and rural areas and help build a healthier prosperous nation. The healthcare sector has always been one of the key focus areas with initiatives like the Ayushman Bharat scheme. The scheme has benefited so many people and helped to improve the healthcare infrastructure in the country.”

He further added, “In budget 2020, we would like to urge the government to introduce zero-rating GST on healthcare services, provision for liberalised FDI regime for investments in health infrastructure and medical innovation fund and import duty relief for life-saving equipment. It will help in bringing down the expenses of healthcare significantly. Another important aspect is preventive health check-ups that can eradicate and analyse high prone diseases. We hope that the government will increase medical reimbursement deduction pertaining to the rise in inflation and encourage the need for prevention amongst people. We at Fujifilm are working extensively towards promoting preventive healthcare amongst consumers and understand the importance to offer medical solutions to the community that best cater to their needs and demands.

Ayushman Bharat is a nice step towards universal healthcare in India but better healthcare facilities need to be implemented

Gaurav Gupta, Co-Founder, Navia Life Care

“We would like the Government to partner with healthcare startups to implement their projects and help them establish quality care for the people. The budget should aim to create healthcare facilities in small towns and rural areas. Ayushman Bharat is a nice step towards universal healthcare in India but better healthcare facilities need to be implemented. There are a lack of doctors in public centres and are currently not able to serve. Technologies for doctors like video conferencing and diagnostic tools help the doctors to diagnose the patient and assisting with services across the country. The Government needs to allocate an appropriate budget for the development of a healthcare ecosystem in the country. To provide good quality healthcare in rural India needs to be taken care of like building healthcare infrastructure in rural and remote areas. The government must help the startups to grow through the implementation of tax benefit to angle investors for investing in the startups and to reduce the GST for the new entrepreneurs.

The Ministry of Health and Family Welfare (MoHFW) came up with the National Digital Health Blueprint in July 2019. We hope that the government would take significant strides in that direction with specifications in the budget towards the implementation of digital health in the government hospitals.

Last year, the then Finance Minister announced that the Government of India has envisaged a national programme for artificial intelligence (AI) in a bid to leverage the technology and take it to the masses. We believe that there would be a bigger contribution in the form of budgetary allowance towards that. We hope that there would be specific guidelines given to government agencies on prioritising the implementation of AI-driven technologies in their organisations and departments.”

Policies and budgets towards the adoption of clinically-validated mHealth will help address last-mile access challenges, improve quality of care and reduce costs

Abhishek Shah, Co-Founder, Wellthy Therapeutics

“With about 80 per cent of the medical workforce in 10 cities serving only 28 per cent of the total population, access to quality healthcare is still an aspiration for many. India will double the number of smartphones by 2023. The mHealth market is growing rapidly at a CAGR >42 per cent. Policies and budgets towards the adoption of clinically-validated mHealth will help address last-mile access challenges, improve quality of care and reduce costs.

“Combating inflation and currency depreciation requires exports to be a backbone of the economy. Entire industries and job markets in India come from exports, like the IT sector that draws 75 per cent of its revenues from exports and constitutes 6.7 per cent of India’s exports market. Affordable, clinically-validated healthcare IT solutions can drive significant exports as healthcare spends are eight to18 per cent in more developed economies compared to 1.2 per cent in India and clinically -validated solutions like digital therapeutics (DTx) are growing at a CAGR of >20 per cent globally. Government benefits and forward-thinking policies to this category can help drive exports and help an already ready talent and entrepreneurial base in India help boost the economy.”

More standardisation, tax benefits, digital up-gradation and much more

Nitin Maniar, Chairman, Governing Body, Bombay College of Pharmacy
  • Increased spending in education needed to bring in more standardisation- There is a need to have a centralised database, which will benefit the universities and education institutions.
  • Teacher Training/upskilling requirement- It should be mandatorily linked with respective industry for teaching as well as non-teaching staff for two-way communication and coordination for need versus deliverables.
  • Tax benefits and more research funds- The government has made it mandatory to spend two per cent of net profit on CSR. Of this two per cent, we feel, a certain fixed percentage has to be spent on research in the respective industry/profession. Only by adoption and outcome-based approach, it has to be linked with certain tax benefit thereafter
  • Digital up gradation- Mapping methodology to be adopted right from nursery education to post-Ph.D linked with NITI Aayog for fulfilling the national and international requirement. Usage of IT should be optimally maximised for reaching nook and corner of the country to meet uniform standards.
  • New ranking system for higher education institutions: The government should come up with adoption, outcome and college social responsibility-based policy for ranking of institutions, in adherence to mentorship strategy for holistic development and to meet global challenges.
  • Encourage partnership programmes with foreign universities- The government should encourage blend courses, where students can spend a portion of their courses/syllabus and learn from a foreign university. Many foreign universities are interested in such partnership programmes with Indian institutes and universities. Thus, overall, the course will be cost-effective for the student and at the same time meet his local and global needs.

Higher allotment for the health sector to help schemes like Ayushman Bharat

Dr GSK Velu, Chairman and Managing Director, Neuberg Diagnostics
  • Clear central government guidelines to enable public-private partnership (PPP) in the diagnostics segment to realise the vision of advanced quality diagnostics at affordable cost with accountability and better clinical outcomes.
  • Higher allotment for the health sector to help schemes like Ayushman Bharat to reach a larger section of the population with a measurable outcome
  • Investment in the diagnostics services sector in tier II and II towns to get similar tax breaks and subsidies like hospitals
  • To avoid any ambiguities in GST in the health sector including diagnostics services segment
  • Tax-free spending limits for annual preventive HealthCheck to be enhanced to promote preventive medicine and wellness-focussed healthcare initiatives

Let 2020 be a year of innovation and digitisation

Dr Alok Roy, Chairman, Medica Superspecialty Hospital

India has one of the lowest spendings on healthcare if compared with global data. We know that India is aiming to increase the healthcare spending to 2.5 per cent of the GDP by 2025. However, so far, it stands at one per cent only. We hope to see some action around this in Budget 2020. The government needs to declare some sops to raise this percentage.

There is an overall slowdown in expansion plans of private healthcare players. The government has to increase its intent to collaborate with the private sector so that they understand the financial modus operandi of the private players better. A budget must pay attention to the financial viability of private healthcare by relooking at the pricing controls, reviewing the existing rates of the government healthcare schemes, releasing the money stuck with CGHS, ECHS, etc. which hugely affects the already hit liquidity balances of the existing players. Unless these are addressed in concrete terms, it will be difficult for new entrants to seamlessly operate in the current business scenario.

We also hope that the budget will focus on home healthcare services. Other critical aspects to be addressed include good governance, a robust system to procure and supply medicines, devices as well as a connected health information system.

With the spiralling healthcare costs, the limit for tax benefit must be raised accordingly. Considering that the cost of treatment for life-threatening diseases is generally much higher, the government should try to work out a higher percentage of deduction which will go on to benefit the common man. Individuals should be exempted from the GST as they have covered themselves under insurance for their health protection. This will also bring down the cost of a policy, making health insurance more affordable.

Cost of medical equipment is another pain point, which requires support in the budget, as this will make the medical devices and equipment a part of government’s ambitious programme of ‘Make in India,’ which will accelerate growth in this sector. Critical healthcare equipment such as ventilators, wheelchairs, crutches and medical equipment spare parts should be exempted from GST in Budget 2020. This will help make quality healthcare more accessible.

Innovative, tech-based, and affordable healthcare solutions are the need of the hour and our expectations from a budget also revolve around the same. We do hope that the government promotes more healthcare startups which will digitise healthcare better, increase accessibility and affordability and give a boost to employment generation as well.

The market for healthcare startups and digital healthcare devices is robust. The government must support to promote domestic innovations and provide an incentive for domestic device manufacturers. This will enable us to reduce our dependence on foreign imports. This will not only boost the Indian startup cluster but also make the healthcare market more economic.

Given the importance of primary care, it would be expected that the government would further increase the allocation to give a boost to rollout more health and wellness centres in this FY 

Sumit Goel, Partner – Healthcare Advisory, KPMG in India

The government’s flagship health insurance programme, Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY), gained momentum in 2019 with a number of e-cards issued till date since the launch reaching 12 cr and number of hospitalisations touching 78 lakhs. With the scheme gaining momentum, the budgetary allocation to this scheme would demand an increase. At this stage, the government should also consider taking the next step towards universal health cover, for example, by considering extending this scheme to all senior citizens who face frequent, serious and costly health issues.

In the last budget, health and wellness centres under NHM saw a significantly higher allotment. Given the importance of primary care, it would be expected that the government would further increase the allocation to give a boost to rollout more health and wellness centres in this FY to move towards the goal of 150,000 such centres against 28,000 at present.

Niti Aayog recently came out with a report envisaging future health systems in India. The report focused on boosting digital infrastructure, restructuring public health institutions and integrated service delivery, among other themes, to increase access to quality healthcare. Therefore, it is expected that the Union Budget focusses on these areas. The Government of India had envisaged a national programme for artificial intelligence (AI) with health as one of the focus sectors. With use cases of AI in health gaining acceptance, budgetary focus on this area can give it the required impetus.

One of the key focus areas for the government has been to make healthcare more affordable. In this regard, the industry has been advocating zero-rating GST for healthcare services. If these benefits are passed on to the patients, hospitalisation costs can come down significantly, especially for self-paying patients. In addition, due to the capital-intensive nature of the business coupled with long gestation periods, the industry expects the government to consider a longer tax holiday period of 15 years for the hospitals.

With the significant rise in the cost inflation index in general and medical inflation in particular, there is an expectation that government re-introduces the medical reimbursement deduction and the annual limit is enhanced to appropriately take care of the inflationary increases since the time when the limit was the last set.

Shireesh Sahai, CEO, Wolters Kluwer India

The government should continue to invest in medical education and healthcare infrastructure

“Over the last few years, the government has taken some major steps to improve healthcare in India. But there is a lot more to be done. So, the government should continue to invest in medical education and healthcare infrastructure. It should invest in the best of breed digital tools that supplement the new competency-based curriculum, thus enabling the students to learn better, being on par with their counterparts in other countries. We must also ensure that medical colleges and hospitals have access to world-class evidence-based content and technology solutions, that accelerate learning and readiness to practice. These investments will go a long way towards reducing medical errors and improving healthcare outcomes.”

‘Ayushman Bharat’ scheme by the Government of India needs to include homeopathy

Dr Kushal Banerjee, MD (Hom), MSc (Oxon)Dr. Kalyan Banerjee’s Clinic

There needs to be a steady increase in the number and capacity of the central government-run homeopathic clinics with the increase in population density in urban cities. As connectivity and population increases in semi-urban and rural towns and cities, homeopathic clincs need to be opened in these as well.

The highly commendable ‘Ayushman Bharat’ scheme by the Government of India needs to include homeopathy. Public-private partnerships between private homepathy practitioners and the government can be struck. Government outreach and planning can easily accomplish this.

Homeopathy should also be made readily available at primary health centres as an option for those patients who want it.

Most government health centres are held in high regard by the patient. Highly trained doctors of conventional medicine are aware of the limitations of their science. The deployment of homepoaths in these centres can result in a referral from these doctors to homeopaths for conditions that do not respond to allopathic treatment. This will result in minimal time loss for the patient and reduce the burden on conventional doctors. This facility will be important in the primary, secondary and tertiary health centres.

In primary centres conditions likes viral infections of the respiratory system, allergies, a large number of skin ailments and other conditions can be referred to homeopaths. In secondary and tertiary centres, patients with advanced cancers requiring palliation, patients of oragan failures and other serious illnesses can be referred to homeopaths.

At every level of the national health services, homeopathy should be available as an add-on treatment whenever requested since homeopathy does not adversely interact with conventional treatment.

For a country that recognises the importance of complementary medicine as evidenced through the creation of a ministry devoted to it, providing funding and training for these steps to be taken is the next logical step. Training also needs to be provided to conventional doctors for spreading awareness of the conditions that have limited scope in allopathy and are better and more safely managed with homeopathy.

Besides, the high standards of training homeopaths need to be maintained. The National Institute of Homeopathy, Kolkata needs an injection of funds for a large scale revamp and for increasing its patient-handling capacity. Similar centres need to be established in different corners of the country – particularly the National Capital Region (NCR).

In addition, significant funding is required for funding research related to homeopathy. This area of research is not limited to clinical trials (which are extremely important), but also fundamental research which delves into understanding the mode of action of homepoathic medicines and ultra dilutions in general.

Funding to establish research partnerships with institutes of excellence like the Indian Institutes of Technology can yield siginificant results which will stand up to the highest levels of scientific scrutiny.

Steps are also needed to address concerns which the patient population may have related to seeking homeopathic treatment. These need to be addressed and doubts need to be clarified through aggressive yet non-sensational media outreach by government bodies like the Central Council of Homeopathy and the Central Council for Research in Homeopathy. This will serve as a reliable, truthful source of information to combat any biased projection or misinformation circulating in the media.

Exempt medical devices from GST

Ravi Mathur, CEO, GS1 India

“With industry demanding to exempt medical devices from GST in the Union Budget for making them affordable, it is imperative that they are uniquely and universally identified using global standards to enable their track and trace and recall if required. This would enable authentication of devices as well and consequently enhance patient safety in India.”

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