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Cashless Healthcare: The story of future India

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In times of demonetisation, Nipun Goyal, Co-founder, Curofy talks about how being cashless will turn out to be a boon for the healthcare sector and help curb shady dealings in the long run

PM Modi’s war on black money took a steep flight on November 10, 2016, with the announcement to discontinue current currency notes of higher denomination. While this has sent the stock market into a frenzy with an anticipated correction, Indian healthcare system is yet to feel the shock waves.

With Rs 500 and Rs 1000 notes being discontinued, our healthcare system, which has been cash dependent since years, will be jolted into the world of cashless transactions. In a twist of policy, tech averse sectors will be forced to become digital and embrace change.

Who will face a hard time?

Private medical institutions: Indian medical education system has long been used as a money laundering portal. With this move, seats bought through management with under the table cash transactions will come under the scanner. This will throw the private medical college in the throes of a massive transformation.

Private clinics and nursing homes: While most of the corporate hospitals transact in open and pay their due taxes, a sizeable portion of private practitioners and nursing homes deal only cash. They go on to pay taxes for only a part of their income and the rest is stashed away as cash. These clinic owners will have to come forward and declare their income now since the hoarded up cash has been deemed worthless.

Home healthcare systems: Home healthcare services which are used by elderly and people with chronic illness will face a hard time since these services were paid for at doorsteps in the form of cash. Payment for these services would now be done through digital transactions. There will be an initial hitch in transition to bring these services online.

It is a move to be lauded and welcomed

The move by our PM to fight black money is one of the game changing reforms in our economical history after the liberalisation of the 90s. We should laud the efforts and welcome them because it is going to help us in the long run in many ways.

Bringing down the cost of medical education: With a tight noose around illegal negotiations, medical institutes will no longer be a portal to launder money which will completely obliterate the cash component in admissions. This will bring down the cost of education and encourage admission on the basis of merit. In the long run it would improve the quality of healthcare and make it affordable.

Moving towards health insurance: Insurance will have a major role to play in making healthcare cashless. Artificial inflation caused due to free flow of cash would come into check. With money not available at their disposal, people will move towards tax saving schemes like insurance. This will maintain uniformity in the cost of services and provide immunity to people against sudden medical expenditure.

Switch from paper money to plastic money: Limit on withdrawal of money from ATMs is going to push people towards using their cards to make payments. This in turn will make service providers accommodate the demand of accepting cards. Patients won’t have to worry about carrying money with them physically as their treatment will be only a swish of card away. With their money going online, more people will come in the digital health ecosystem. In long-run, all this will improve the quality of healthcare and make it more affordable.

Cash offerings to convert in honorarium: Interactions between healthcare practitioners and pharma companies have been a debated area. Shady dealings between pharma firms, especially small pharma companies and doctors are an open secret. With transactions going online these cash offerings will be converted into honorarium in forms like surveys and consultation, which will be liable to due taxation.

It will be ignorant to say that there won’t be any glitches in the transition. Changes in a $150 billion sector is bound to hit some roadblocks. But digitisation of healthcare has been long overdue, this move will nudge us in that direction. With time, the industry will adapt to this change for the betterment of patients, doctors and all the healthcare stakeholders.

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