Equity Themes in India's Health Sector Reforms

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Equity Themes in India’s Health Sector Reforms
Working Paper · August 2006
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Equity Themes in India’s Health Sector Reforms
By
Sanjib Pohit, Samantak Das, Indranil De
NCAER Projects Working Paper No: I 035/ 03

As Part of the Project
“Efficiency, Equity and Access in India Infrastructure: Blending Competition and Regulation.”
Co-financed by
The European Union under the “University Studies” dimension of the EU-India Economic
Cross Cultural Programme (ECCP)
CONTENTS
List of Acronyms 2
List of Appendix Tables 3
Abstract 4
1. Backdrop 5
2. Programmes & Regulation in the Health Care sector in India 11
3. Health Equity 24
4. Private and Public Health Service Providers: A comparison 42
5. Choice of Health Care Provider 48
6.Summary and Conclusions 52
Biblography 58
Appendix Tables 61
1
List of Acronyms
API Annual Parasite Incidence

APL Above Poverty Line
ARI Acute Respiratory Infections
AYUSH Department of Ayurveda, Yoga & Naturopathy, Unani, Siddha and
Homoeopathy
BPL Below Poverty Line
CCH Central Council of Homeopathy
CCIM Central Council of Indian Medicine
CEB Child Ever Born
CEHAT The Centre for Enquiry into Health and Allied Themes
CHC Community Health Centre
CS Child Survival
CSSM Child Survival and Safe Motherhood
DOTS Directly Observed Treatment, Short Course
DPH&PM Department of Public Health and Preventive Medicine
FRUs First Referral Units
GE Generalised Entropy
ICDS Integrated Child Development Program
IEC Information Education and Communication
IMR Infant Mortality Rate
JE Japanese encephalitis
MDT Multi-Drug Therapy
MLD Mean Log Deviation
MLTUs Mobile Leprosy Treatment Units
MMR Maternal Mortality Rate
MOHFW Ministry of Health and Family Welfare
2
Appendix 1. Tables
Table A1: Health Indicators and Composite Index of Health 61

Status of Major States in India
Table A2: Inequality in the Proportion of Children 62

Administered with Measles Vaccine to Total Children
(in the age group 0-4 Years) in a Household
Table A3: Inequality in the Proportion of Children Registered 64

for Paediatric Care to Total Children (in the age
group 0-4 Years) in a Household
Table A4: Inequality in the Proportion of Mothers Receiving 66
Medical Attention at Childbirth to Total Mothers of
Children Born during the last 365 Days (Preceding
the date of Survey) in a Household
Table A5: Inequality in Proportion of Mothers Registered for 68
Post-natal Care to Total Mothers of Children Born
During the last 365 Days (Preceding the date of
Survey) in a Household
Table A6: Average Expenses Incurred (Including Cases of 70
Zero Expenses) for Treatment of Members Treated
as Inpatient in Hospital during the last 365 Days
(Rs. Per Spell of Ailment)
Table A7: Average Expenses Incurred (Excluding Cases of 71

Zero Expenses) for Treatment of Members Treated
as Inpatient in Hospital during the last 365 Days
Table A8: Average Expenses (Including Zero Expenses) 72
Incurred during the last 15 Days for Treatment
of Members as Outpatient (Rs. Per Spell of Ailment)
3
Equity Themes in India’s Health Sector Reforms 1
Abstract
The prevalence of inefficiencies in public health system in the form of mis-targeting,

deterioration in quality of services and inadequacy of funds faced by governments had
stimulated a debate on the issue of government’s involvement in the provision of health
services. Since the onset of economic reforms in India in 1991, this debate took a strong turn.
Recognising the fact that inefficiencies were rampant in public health care system and that
public spending on health formed only a minuscule proportion of the total spending on
health, the government of India opened up the medical care sector to private sector and
introduced cost recovery mechanisms in public hospitals.
In view of this, the empirical analysis of this paper has focussed on (i) health equity (ii)
comparison between private and public sector service providers with respect to medical
expenditures and quality of treatment and (iii) determinants of service providers. Two Indian
states, viz., Kerala (a ‘good performer’ in terms of health status) and Madhya Pradesh (a ‘bad
performer’ in terms of health status) have been selected for the purpose of analysis. The paper
has used data drawn from nationally representative large-scale health survey undertaken by
the National Sample Survey Organisation (NSSO) during July 1995 – June 1996. This is the
latest data on health issues published by NSSO.
The study shows that in spite of several health programmes and regulations, the government
has not been able to spread the required health services universally throughout the country.
The inequality of access to health facility is larger in the state where health status is low. The
public health care system should play a more active role especially in the inpatient health care
sector. The accessibility and quality of health care services in public sector has to improve,
particularly in rural areas so that it can put a ceiling on the soaring prices in the private sector
as has happened in case of Kerala. This would ultimately help the people who belong to the
lower ends of the socio-economic hierarchy and can be a major anchor for equity in the
health service system.
1
The authors are immensely grateful to Professor D. B. Gupta for valuable comments and suggestions. We also
acknowledge our gratitude to Dr. Pooja Vasudeva Dutta and Ms Rupa Malik for valuable suggestions.
4
Equity Themes in India’s Health Sector
1. Backdrop
The focus of the government on health conditions of the people of India was initiated way
back since independence. The first landmark in official health policy of Independent India
was the acceptance of the Bhore Committee recommendations of 1946, which laid the
foundations of comprehensive rural health services through the concept of primary health
care. The committee strongly recommended that no individual should lack access to medical
care because of inability to pay for it. Primary Health Centres (PHCs) came up in the
countryside from 1952 onwards. In the mid-1960s population control came at the centre-
stage. Gradually different health programmes have been launched from time to time.
Sanitation and drinking water programs were launched from the fifth five-year plan. The
Integrated Child Development Program (ICDS), integrating nutrition and health inputs for
pre-school children and pregnant and lactating mothers was started in 1975. In 1977, the
community health guide scheme was initiated. Later on, a package of minimum needs
programmes was also launched from the early 1980s. At present, government2 health care
provision in India is operating through multiple regulation, schemes and programmes, which
are implemented by various departments and directorates of central and state governments.
Since the onset of reforms in 1991, a debate has arisen on the issue of government’s
involvement in the provision of health services. The arguments in favour of this are many and
well known (Gupta et al, 2002). The broad criticisms that arise from studies on developing
countries including India are the prevalence of inefficiencies in the government health
systems. The outcomes of these inefficiencies have been observed in the form of mis-
targeting, deterioration in quality of publicly provided services and bankruptcy faced by
governments and the public health care delivery system. Studies had shown that due to the
inefficiencies of the public health care delivery system in India, people incurred large amounts
of out-of-pocket expenditure by preferring to visit private rather than public health facilities
for curative care (Visaria et al, 1994; Sundar, 1995). As a result, the whole approach of health
care delivery system in India has been brought into questions.
5
The structural adjustments in India started in the wee hours of 1990s through fiscal reforms
by containing public expenditure. The central government reduced the central transfers to the
states in order to contain the growing fiscal deficits. As a result, the states were left with a
squeezed pool of resources, which in turn reduced the budgetary allocation to various sectors.
In a situation like this, the social sectors are found to be the ‘soft targets’ for reducing
budgetary allocation in most of the developing countries and India is no exception to this
phenomenon. In fact, all the major states in India faced severe fiscal strains during 1987-88
and it was since this period that the states reduced the budgetary allocation to the health
sector (Selvaraju, 2003). Recognising the fact that inefficiencies were rampant in public
health care system and that public spending on health forms only a minuscule proportion of
the total spending on health, recommendations from various quarters argued for cuts in
government spending on health services, opening up of medical care to private sector and the
introduction of cost recovery mechanisms in public hospitals (Pradhan and Roy 2003).
The emphasis of the government of India to reduce its stake from the health care system and
the opening up of medical care to private sector is manifested in the significant shift of
treatments from public health facilities to private ones. The data collected by National
Sample Survey Organisation (NSSO), Department of Statistics, Government of India reveals
that the share of private health care facilities in case of inpatient treatments have increased
from around 40 per cent to 57 per cent in both urban and rural India between 1986-87 and
1995-96. The data also reports an increase in the share of private sector in case of outpatient
treatments.
The prevalence of inefficiencies in public health system is a fact. However, there is a strong
belief that in absence of a well-functioning public health system, the demand for services
from the private health care sector can be highly inelastic. People may be compelled to either
pay high prices charged by private sector or opt out of health services altogether (Sen et al,
2002). In other words, it may be argued that the presence of a well-functioning public health
system can set a ceiling for prices and a norm for quality in the private sector. This is more
pertinent in case of India where a large proportion of the population belongs to the lower
ends of the socio-economic hierarchy. The strong perception that the quality and accessibility
of health system in India would suffer as a result of privatisation may be countered by the
2
The terms ‘government’ and ‘public’ has been used interchangeably in this paper.
6
argument that the existence of an efficient public health system can act as a major anchor for
equity in the health service system (Sen et al, 2002).
India has now opened her health sector for private participation. However, two conditions are
must for successful private participation, namely regulatory framework, a sound competition
policy and an effective enforcement mechanism. As a result of self-realisation and other
externalities, India have recently revised their competition and sectoral regulatory laws.
However, the focus of the new policy is more on the industries than on the health sector. In
fact, India has now separate regulatory bodies for some of the service sectors like telecom,
electricity, insurance, but nothing has been drafted for health sector as such. It should be
noted that the implementation record for the new competition policy or regulatory bodies is
not very promising. In fact, in many instances, consumers are resorting to judiciary to
enforcing commitments from the private bodies. In Box 1, we lists out some of the lacunas of
opening up health sector without having a sound enforcement/regulatory mechanism.
Box 1: Inefficiencies of Enforcement Mechanism

1. The Public Interest Litigation (PIL) filed by the CEHAT, an NGO, against pre-natal sex
determination has been instrumental towards amendment of the PNDT Act and the formation of
Healthcare Accreditation Council.
2. A study conducted by CEHAT in 1994 at Satara, a suburb of Mumbai revealed that none of the
private hospitals were registered with any health authority and none of them had an ambulance.
Further, the space per bed ratio was adequate in only 6 per cent of the hospitals.
3. A recent study conducted by CEHAT in Chennai showed that caesarians account for 60 per cent of
total deliveries in private hospitals whereas only 10 per cent are C-sections in public hospitals. But
this is not regarded as malpractice.
4. Since the early 1990s, many private hospitals have opened up in Delhi. At the time of allotment of
land to these hospitals, the lease deed of DDA had made it clear that they would have to provide
free medical care to 25 per cent patients in form of hospital beds and other facilities. However, for
the past many years, these hospitals have violated these norms with successive Governments looking
the other way. In the end, the judiciary seized of the matter and Delhi government has to follow
suit.
5. Although India has a well-developed pharmaceutical industry amongst the developing countries, it
is being controlled by weak and inefficient regulatory machinery. At the policy making level, it has
somewhat an efficient Central authority which is functioning from the office of the DGCGI. But
the DCGI hardly effective as far as the enforcement of policy directives and various changing rules
of the country. This critical job is the responsibility of the drug control administrations of states and
Union territories, the functioning of which in most of the states is pathetic. This disregard by most
of the state governments in regulating the pharmaceutical industry and trade is the single reason for
the undesirable growth of spurious and substandard drugs in the country.
7
In the backdrop of above, the current paper presents a situation analysis of the health system
in two Indian states (a ‘good performer’ and a ‘bad performer’ in terms of health status) with a
focus on (i) health equity (ii) comparison between private and public sector service providers
with respect to medical expenditures and quality of treatment and (iii) determinants of service
providers.
The empirical analysis in this paper uses data drawn from nationally representative large-scale
health survey undertaken by the National Sample Survey Organisation (NSSO) during July
1995 – June 1996. This is the latest data on health issues published by NSSO.
For the purpose of selecting two states – one a ‘good performer’ and the other a ‘bad
performer’ - three important indicators of health status, viz., infant mortality rate (IMR),
maternal mortality rate (MMR) and life expectancy have been considered. It is generally
difficult to say whether state ‘A’ is having a better health status than state ‘B’ when health
status is defined in terms of a large number of indicators. One solution is to construct a single
composite index, which would ideally represent the chosen set of indicators. Principal
component analysis (PCA) which is a scientific tool to construct a composite index by
assigning objective weights to the indicators has been used to rank the states (relative to each
other) on the basis health status. PCA constructs the single composite index in such a way
that the weights given maximise the sum of the squares of correlation of the indicators with
the composite index. After ranking the major states of India with respect to health status,
Kerala (a good performer) and Madhya Pradesh (a bad performer) have been selected for the
empirical analysis (see Table A1 in the Appendix).
The two states selected are very much different in terms of geographical coverage,
demographic characteristics and socio-economic status (Table 1). Madhya Pradesh is a much
larger state than Kerala but the population density of Kerala is higher than that of Madhya
Pradesh. The density of population is 819 persons per sq., km in Kerala, while it is 196
persons per sq. km. in case of Madhya Pradesh in 2001. The percentage of lower caste
people, Schedule Caste (SC) and Schedule Tribe (ST), is higher in Madhya Pradesh at
around 35% than in Kerala at around 11% in 2001. In terms of growth of Net State Domestic
Product, literacy rate for male and female, and households living in permanent house, Kerala
is placed in higher position than Madhya Pradesh. Moreover, availability of public health
8
facilities like hospitals and beds per 10-lakh population is also much higher in Kerala than in
Madhya Pradesh3 .
Table 1: Socio-Economic Profile of Kerala and Madhya Pradesh

Indicator Year Madhya
Kerala
Pradesh#
Area (in sq. kms) 2001 38863 308245

Total Population 2001 31841374 60348023
Density of Population (per sq. kms.) 2001 819 196
Percentage of Rural Population 2001 25.96 26.46
Percentage of SC and ST Population 2001 10.90 35.50
Annual Compound Growth Rate of Between 1993-
Net State Domestic Product at 94 and 2003-04 5.39 4.51
constant prices(%)
Literacy Rate_ Persons (%) 2001 90.9 63.7
Literacy Rate_ Male (%) 2001 94.2 76.1
Literacy Rate_ Female (%) 2001 87.7 50.3
Percentage of Households Living in 2001
68.16 41.54
Permanent House- Total
64.60 31.24
Permanent House- Rural
78.87 71.53
Permanent House- Urban
Number of Public Hospitals per 10 2002
66 2
Lakh Population
Number of Public Dispensaries per 10 2002
2 2
Lakh Population
Number of Beds in Public Hospitals 2002
3455 348
per 10 Lakh Population
Source: Central Statistical Organisation, Government of India
Note: Numbers in the parenthesis are corresponding year
#The state has been bifurcated into Madhya Pradesh and Chattisgarh state in November
2000
The number of households covered in the survey and sample size with regard to different
health indicators are reported in Table2.
3
10 Lakhs = 1 Million
9
Table: 2 Number of Households Covered in the Survey and Sample Size of Responses with
respect to Health Indicators
Items Rural-Urban Kerala Madhya Pradesh
Affiliation
Households Rural 2850 5161
Urban 2078 3275
Total 4928 8436
Spells of ailments suffered during the last 15 Rural 1533 1217
days preceding the date of survey by the Urban 856 769
members or deceased members of the Total 2389 1986
household
Cases of inpatient treatment during the last Rural 1042 752
365 days preceding the date of survey Urban 764 750
Total 1806 1502
Cases of outpatient treatment during the last Rural 1339 1033
15 days preceding the date of survey Urban 779 716
Total 2118 1749
Children of age 0-4 years Rural 1443 4199
Urban 1088 2163
Total 2531 6362
Mothers of children born during the last 365 Rural 600 1532
days preceding the date of survey Urban 424 771
Total 1024 2303
Source: Computed from NSSO, 52nd round (July 1995 - June 1996)
The paper is structured as follows. The next section describes the important health schemes
and programmes and the current regulations of the government. Section 3 examines the
equity aspects of certain health-related indicators. The equity aspect has been examined with
respect to geographical regions (rural and urban) and consumption groups (proxy for income
groups). In section 4, a comparison between the public and private health care service
providers has been made relating to health-related expenditures and quality of service. The
10
determinants of choice of health care provider have been analysed in section 5. Section 6
offers some conclusions.
2. Programmes and Regulation in the Health Care Sector in India
The article 246 of the Constitution of India contains the Union list, the State list and the
Concurrent list with specific areas of law making by the Parliament and the State
Legislatures. In the Union list, health related matters do not appear directly. In the State list,
the major health care related items are public health and sanitation, hospitals and
dispensaries. The Concurrent list contains items on which both the union and the state
governments have power. In this list, the three direct health care related items are (i) drugs
and poison, (ii) legal, medical and other professions and (iii) prevention of the spread of
infections of communicable diseases or pests affecting human beings, animals and plants from
one state to another.
According to the Indian constitution, both union (central) and state governments have the
power to regulate the health care service in India. According to Article 47 of the Constitution
of India, health is a state subject4 . Health and public health are parts of the Directive
Principles of state policies in part IV of the Constitution. They are not part of the
fundamental rights.
The states receive funds from the central government for the programmes on the Concurrent
list and are responsible for the implementation of those programmes. The central government
has the Ministry of Health and Family Welfare (MOHFW) which manages health
programmes in the country. The central government is responsible for health services in
union territories without a legislature. It is also responsible for developing and monitoring
national health standards and regulations and linking the states with funding agencies.
2.1 Major Health Programmes and Regulations of Union Government
The health policies of government of India focus on both preventive and curative health care.
The three departments of MOHFW, viz., Department of Health, Department of Family
4
The state shall regard the raising of the level of nutrition, standard of living of its people and improvement of
public health as among its primary duties. In particular, the state shall endeavour to bring about prohibition of
11
Welfare and Department of Ayurveda, Yoga & Naturopathy, Unani, Siddha and
Homoeopathy (AYUSH) have separate policies. The major policies of three departments
have been enumerated in Table 3.
Table 3: Major Health Programmes of Government of India

Name Year of Initiation Objective Remarks
Department of Health
Integration of 2003-04- To control Malaria, Filaria, Annual parasite incidence
National Anti NVBDCP; Japanese encephalitis, Kala- (API) for Malaria has
Malaria Programme, 1958-Malaria azar and Dengue declined from 3.48 in 1996
National Filaria Control; 1955-96- to 1.62 in 2003
Control Programme Falaria Control;
and Kala-azar 1990-91- Number of Kala-Azar cases
Control Programme Kala-azar control increased from 12886 in
to National Vector 1999 to 17321 in 2003
Borne Disease
Control Programme
(NVBDCP)
National Leprosy 1983 To arrest Leprosy in all Prevalence declined from
Eradication known cases 24/10000 in 1991 to
Programme (NLEP) 3.7/10000 by March 2001
Revised National 1997 To cure at least 85% of new Nearly 2800000 patient have
Tuberculosis sputum positive TB patient been placed on treatment and
Control Programme and detect at least 70% of saved about 500000
(RNTCP) such patient by WHO- additional lives
recommended Directly
Observed Treatment, Short
Course (DOTS)
National Programme 1976 To reduce prevalence of Blindness reduced from 1.4%
for Control of blindness through cataract of population in 1976 to
Blindness surgery, school eye 1.1% 2001-02
the consumption, except for medicinal purposes, of intoxicating drinks and of drugs, which are injurious to
health.
12
screening programme,
collection and utilisation of
donated eyes etc.
Department of Family
Welfare
National Population 2000 To encourage voluntary and Total acceptors of
Policy informed choice of citizens sterilisation, IUD Insertions,
for availing reproductive condom users and oral pill
health care services. users have increased by 5.8%
in 2003-04 as compared to
2002-03.
Reproductive and 1997 To promote maternal and The Maternal Mortality
Child Health child health by Ratio declined from 437 per
Programme (RCH) incorporating components 100000 live births to 407 per
covered under the Child 100000 live births in 1998.
Survival, Safe Motherhood
Programme and The Infant Mortality Rate
components relating to has declined from 129 per
reproductive tract infection 1000 life births in 1976 to 63
and sexually transmitted per 1000 life births in 2002.
infections
Universal 1985 To control vaccine preventable Significant drop in the infant
diseases namely, diphtheria,
Immunisation mortality rate from 129 per
pertussis, neonatal tetanus,
Programme (UIP) 1000 life births in 1976 to 63
tuberculosis, poliomyelitis and
measles.
in 2002
Oral Rehydration 1986-87 To control of deaths due to Diarrhoea still remains one
Therapy(ORT) dehydration caused by of the leading causes of death
diarrhoea among children under 5
Years
13
Acute Respiratory 1989 Train peripheral level An evaluation carried out in
Infections health workers to recognise two districts in 1991 found
(Pneumonia) pneumonia and treat with that the trained health
Control cotrimoxazole workers
were able to correctly
diagnose and treat
pneumonia
Child Survival and 1992-93 To sustain and strengthen The programme is being
Safe Motherhood the ongoing Immunisation, implemented with the
(CSSM) Programme Oral Rehydration Therapy financial assistance of World
(ORT) and prophylactic Bank and UNICEF
schemes; improve maternal
and disposable delivery kits
to the pregnant women ;
expand the programme for
control of Acute
Respiratory Infections
(ARI) for children below 5
years of age; set up a
network of sub- district
level First Referral Units
(FRUs) for improving
emergency obstetric care
Department of
AYUSH
Central Scheme for 1991 Development of Alternative medicine is not

Development & demonstrative medical very popular due to lack of
Cultivation of plants garden, development modernisation,
Medical Plants of agro-techniques of standardisation and
medicinal plants validation
14
Source : Ministry of Health and Family Welfare, Government of India(GoI), various
publications; GoI budget document, various issues.
The Department of Health runs several National Programmes. The National malaria Control
Programme has been initiated in 1953. Later on, due to failure to cap the resurgence of
malaria and the stagnant/increased incidence of other Vector Borne Diseases (VBDs) such as
filariasis, Japanese encephalitis (JE), kala-azar and dengue all these diseases were integration
under the National Vector-borne Disease Control Programme (NVBDCP) during the Tenth
Plan (2002-07).
The National Leprosy Control Programme (NLCP) was initiated in 1955 to contain leprosy
in India. Following the advent of multi-drug therapy (MDT) in 1982, the National Leprosy
Eradication Programme (NLEP) was launched in 1983 with the objective of arresting the
disease in all known cases of leprosy. The World Bank has also being involved in containing
leprosy in India. The first World Bank financed NLEP Project was implemented in India
from 1993 to September 2000 wherein the Project supported the vertical programme
structure for high-endemic districts, while Mobile Leprosy Treatment Units (MLTUs) were
established in moderate- and low-endemic districts. The tenure of the second phase of the
World Bank financed NLEP project was from 2001-02 to 2003-04. Due to all these efforts
the prevalence rate of leprosy in India decreased from 3.74 cases per 10000 population in
2000-01 to 2.44 cases per 10000 by March 2004. But there are still 17 states where the
prevalence rate is more than 1/100005 and 71 districts have a prevalence rate of more than
5/10000 population. In contrast, Thailand reduced the prevalence of leprosy from more than
50/10000 population in 1953 to less than 1/10000 population by 1995 by dismantling the
vertical programme and integrating leprosy control activities into the provincial primary
health care services (WHO, 2001). Sri Lanka eliminated leprosy by 1995 by using the mass
media to change the attitude of the masses and increased case detection.
To control Tuberculosis the National Tuberculosis Control Programme was launched in

1962. Later on, Revised National Tuberculosis Control Programme (RNTCP) has been
initiated in 1997. It is being conducted by adopting the WHO-recommended Directly
5
In May 1991, the World Health Assembly adopted resolution on the elimination of leprosy to reach the global
target prevalence of less than 1 case per 10000 population by 2000.
15
Observed Treatment, Short Course (DOTS) strategy. By December 2004, 545 districts with
a population of 94.2 crore had been covered and it is expected to cover the entire country
under the RNTCP by 2005-06 (Government of India, 2005).
The Department of Family Welfare has launched National Population Policy in 2000, which
provides a policy framework for advancing goals and prioritising strategies during the next
decade to meet the reproductive and child health needs of the people of India and to achieve
net replacement levels of total fertility rate by 2010 6 . Panchayati Raj Institution has been
made an important stakeholder in this regard. Information Education and Communication
(IEC) activity and the role of Public-Private Partnership with voluntary organisations have
also been emphasised. Some of the state governments have also formulated their own State
Population Policies with specific strategies and programmes. For promotion of maternal and
child health, the government of India launched Reproductive and Child Health Programme
(RCH) in 1997. Reducing infant and child mortality has been addressed through Universal
Immunisation Programme (UIP), where immunisation of children is carried out against six
vaccine preventable diseases7 , control of deaths due to acute respiratory infections, control of
diarrhoeal diseases and provision of essential new-born care to address the issue of the
neonates.
Despite these initiatives of the government, the programmes of Department of Family

Welfare have not been spread universally throughout India. The spread and adoption of
family planning programmes depend on social development along with economic wellbeing
(Banerjee et. al., 1999). Infant mortality also depends on different socio-economic
parameters. The policies formulated at the central level do not comprehensively take into
account the socio-economic differences. As a result these initiatives have become less
effective.
The Department of Ayurveda, Yoga & Naturopathy, Unani, Siddha and Homoeopathy
(AYUSH) has developed a broad institutional framework to carry out its activities. The
Department consists of two statutory regulatory bodies, namely, Central Council of Indian
Medicine (CCIM) and Central Council of Homeopathy (CCH). This institutional
framework is responsible for laying down minimum standards of education and norms,
6
The Net Replacement-level fertility is defined as the level of fertility at which a couple has only enough
children to replace themselves, or about two children per couple.
16
recommending recognition of medical qualifications, registering the practitioners and ethical
matters, etc. Despite the fact that all these initiatives are in vogue and that the alternative
medicine is cost effective and efficient, it has not become very popular. One plausible reason
for this could be its lack of modernisation, standardisation and validation.
The National Health Policy, launched in 2002, is designed to achieve an acceptable standard
of good health amongst the general population of the country (Government of India, 2004).
It covers all aspects of health care and contains policy prescription covering various issues
including financial resource, equity, delivery of national public health programmes, public
health infrastructure, education of health care professionals, health research, role of various
stakeholder (like NGOs and civil society), enforcement of quality standards for food and
drugs, and woman’s health etc.
In the regulation side, it is surprising to know that more than 20 per cent of illness cases in
rural India are treated by either traditional healers or unqualified private doctors (Gupta et al,
2002). In urban areas, the figure is presumably similar. This is despite the fact that the
Medical Council of India under Indian Medical Council Act, 1956 has been made
responsible for registration of doctors and their qualifications, maintaining uniform standard
of medical education and maintenance of Indian Medical Register. Another important issue
of regulation is the quality of drugs. The Central Drugs Control Organisation along with
Drug Control Organisation in the states are responsible for safety, efficacy and quality of
drugs, their import, manufacture, distribution, sale and standards. Drug testing laboratories
have also been set up in Kolkata, Ghaziabad, Chennai, Mumbai and Guwahati. Even in the
presence of all these standing regulators, the trade of spurious drugs is quite significant in
rural as well as urban areas of India.
To contain the declining sex ratio and for curbing the menace of female foeticide, the
government of India brought into force the Pre-Natal Diagnostic Techniques (Regulation
and Prevention of Misuse) Act, 1994. The PND Techniques (Regulation and Prevention of
Misuse) Amendment Bill 2002 has been passed by bringing the technique of sex
determination during pregnancy and use of ultra sound machines within the ambit of this
Act. It has made punishments prescribed under the Act more stringent. To resist illegal
abortion, the government also promulgated amendment to the Medical Termination of
7
Six vaccine preventable diseases are Diphtheria, Pertussis, Tetanus, Polio, Measles and Tuberculosis
17
Pregnancy (MTP) Act- 1971. However, in many cases, unlawful medical practices are widely
prevalent despite regulation against them. In private hospitals, a substantial number of sex
determination cases and abortions take place along with abortions by traditional healers and
birth attendants (George, 2002).
2.2 Policy and Regulation of the State Government
The finances of the state governments regarding health are fragmented into several heads.
The central government grants go to the state governments for plan and non-plan
expenditure; some grants go directly to district societies. The state governments, in turn,
release the grants for specific programmes to the concerned programme officer, district
hospital and other facilities like Community Health Centre (CHC), Primary Health Centre
(PHC), sub-centre and medical colleges. States where decentralisation has made a dent (like
Kerala), non-plan funds are distributed to these facilities, but plan (development) grants are
released to the Panchayati Raj Institutions (PRIs) (Rao, 2004).
State governments have their own policies and regulations in the health sector since it is also
a state subject. Items like public health, hospitals and sanitation fall in the State List of the
constitution. Policies of the state governments differ from one another. However, in most of
the states, the Health and Family Welfare Department of the state government enforces
several policies through several directorates.
In general, the Director of Medical and Rural Health Services in the state is in charge of
planning and implementation of all programmes of Medical Services, including
implementation of various Acts like Human Organ Transplantation Act, Private Clinical
Establishment Regulation Act, Pre-Natal Diagnostic Techniques Act, Recognition of Private
Hospitals etc. The Department of Public Health and Preventive Medicine (DPH&PM) in
well managed states like Tamil Nadu is providing primary health care with a motive to
provide a healthy and disease free life to the people of the state. Various states have AIDS
control societies, which have initiated several plans to strengthen HIV Prevention and Care,
and Support programmes. Most of the states have directorate of Drugs Control, which is
responsible for enforcing Drugs and Cosmetics Act 1940. It is the controlling and licensing
authority for grant and renewal of licences for manufacture and sale of allopathic, ayurveda,
siddha and unani drugs, homeopathic medicines and cosmetics.
18
The state governments are primarily responsible for management of health care system. The
performance of health programmes have been found to be better in states which are better
politically managed rather than states which suffer from inept political management and
instability (Das et al, 2000). Co-ordination among various departments, programmes and
schemes is an important prerequisite for a well functioning health system. It was due to
inadequate co-ordination between the line department of water supply and the concerned
department of Sanitation that Andhra Pradesh faced the gastro-enteritis epidemic (Baru and
Sadhna, 2000). Many states in India have adopted the private-public partnership (PPP)
mechanism for providing health care. However, none of them has comprehensive sector-wide
(addressing both public and private sector roles together) policy (Bhat, 2000). In most of the
states private sector health care system is not well regulated through setting up of ceiling for
prices and quality norms (Yesudian, 1999). Strengthening the role of the public sector is
perhaps the most effective way of ensuring lower price and better quality of treatment in the
private sector.
As mentioned earlier, two states, viz., Kerala and Madhya Pradesh have been selected for
empirical analysis in this paper. It is interesting to note that Kerala, have not framed health
policy. However, the state government has taken significant responsibility in delivering health
care services. On the other hand, in case of Madhya Pradesh, there is one draft health policy
of the state. The major activities and policies of the two states in public health have been
summarised in Table- 4.
Table 4: Major Health Policy/Activity of Kerala and Madhya Pradesh
Kerala Madhya Pradesh

Employee State Insurance to insure persons Develop multiple ways to finance the
and their family members through health care in the state. This could include
inpatient and outpatient treatments tax based financing, risk-sharing
including free supply of medicines, mechanisms e.g. insurance (individual and
specialised treatments, X-ray and group insurance, Community based Health
laboratory facilities and ambulance services Financing), co-payment, service fees,
donations etc. In particular, to develop
19
School Health Programme and Health community based health care financing
Education to introduce health cards system for primary and secondary care with
scheme to new born babies of the state in a the participation of government, family and
phased manner in order to keep the status community
of health conditions covering
immunisation, disease pattern, Increase the efficiency of the government
demographic and statistical evaluation etc. run health care through improved
management i.e. increased financial
Improvement of mental health centres. autonomy -budget and expenditure, and
Additional facilities like equipment, managerial autonomy - personnel and
furniture, cots, bedsheets and other inputs systems, and output and outcome
are to be provided as per Medical Health orientation. The autonomous management
rules to the centres. should be applied first to the districts with
large urban population
Improvement in medical infrastructure.
Improved hospital infrastructure of three Increase the number of Sub Health Centres
shift system to staff nurses, nursing (SHC) in the state (taking census 2001 as
assistants, and Hospital Attendants Grade the base) and ensure the facility for
I & II to be extended in all the Taluk institutional delivery at each SHC
Hospital, District Hospitals and General
Hospitals. Providing equipment to major Achieve equity in access to quality health
hospitals and repair of idle equipment. care, health care interventions of proven
Upgrade and strengthen community health effectiveness (evidence based) for diagnosis
centres in rural areas. The infrastructure and treatment of conditions / diseases of
and other development facilities of these children, adolescents and adults (males and
centres will be fully met from the grant-in- female) supported by public / public
aid allocated to local bodies. assisted funds
Opening, improvement and upgradation of Community level groups and institutions

dispensaries in rural areas. would be supported for information,
education and communication and
20
Start psychiatric unit in district hospitals. behaviour changes for achieving knowledge
and skills for healthy living, Further, the
Increase the inpatient facilities in the educational institutes, particularly the
peripheral institutions by post creation in schools will be utilised for achieving
the cadre of medical officers, staff nurses, appropriate health seeking behaviour
nursing assistants, health assistant cadre I
& II and part time sweeper. Encouraging Indian systems of medicine
Strengthen Monitoring Cell and Organisational and Managerial reform to

Management Information System. make government facilitator, provider,
Strengthen the communication system in monitor and regulator of health care system
the head quarters and districts.
Modernisation of the system through Surveillance for health and disease in
introduction of computer system to 14 private and public sector
district medical officers.
Health Research for increasing efficiency in
Modernisation of Blood Banks. health care
Government is to provide buildings and Improving quality and quantity of human
other facilities. resource for health care
Improving and strengthening the Ayurveda Public private partnership for improved
and Homeopathy medical facilities. health
Opening of Ayurveda hospital in rural
areas and opening of taluk hospitals. Implementation of an approved drug
Improvement of existing and opening of policy.
new Homeopathy dispensaries in rural
areas Procurement of drug to be centralised in
the public sector and a passbook system
Establishing Power Laundries/ should be introduced for supply of drugs to
incinerators/ generators in District government institutions at state and district
Hospitals. level
21
Construction of Health Transport Implementation of Essential Drug Concept

workshop building, vehicle sheds and i.e. the use of essential drugs and standard
modernisation of existing workshops, treatment guidelines in the public and
purchase of equipment, spare parts, private health care system.
purchase of vehicle towards effective fleet
management. Promotion of rational drug use throughout
the state by formation of active Drugs &
Construction of new limb fitting centres. Therapeutic Committees, effective public
Purchase of machinery, equipment, private partnerships and appropriate IEC
materials and supplies and towards other within the community
commitment of the limb fitting centres.
Review and strengthen the control
Strengthen chemical examiner’s laboratory functions of Office of the Controller Food
and Drugs as an enforcement agency- to
Improvement of dental clinics act as a transparent and effective body in
ensuring the quality of essential drugs in
Development of speciality wards like the drug supply chain
geriatric/ diabetic/ cardiology and
neurology in major hospitals Ensure the health of persons working in
places like factories, mines, offices, farms,
Assistance to backward districts prison, hospitals, and other establishments,
including unorganised sector, through
Develop existing hospitals in accident appropriate working environment and use
prone areas to strengthen emergency of modern occupational health techniques
medical services
Address issues related to mental health, to
Establish Pain and Palliative Care Centres recognise and reduce the prevalence of
in district hospitals and general hospitals in mental illness, and to provide the best cost
phased manner effective care and support to patients with
mental illness in the state
22
Starting of super-speciality cadre services
in district hospitals
Strengthen and opening of primary health

centres in rural areas
Strengthen of medical education in the

state.
Source: Various budget document, annual plan document .Government of Kerala, M.P
2.3 Decentralisation in Health care
Decentralisation refers to a situation when responsibilities of upper level of government are

given to the local government through different fiscal, political and administrative
instruments. In his theoretical model Tiebout (1956) has argued that decentralisation would
increase the efficiency of public services. In case of delivery of health services, decentralisation
is expected to make the delivery mechanism more efficient since it has the opportunity to take
into account the local needs and preferences. The local demand for health services might vary
across districts, blocks and villages. Decentralisation of responsibility of delivery of health
services from central and state governments to the local governments at district, block and
village levels would benefit the communities by providing services of their choice. This
approach would make the planning process demand-oriented and client responsive. It would
also save misuse of government resources by not delivering services for which there is no
demand. One of the important prerequisites of making the decentralised system successful is
a proper co-ordination among the different stakeholders in the system. Co-ordination
between (a) Panchayati Raj Institutions (PRIs) and technical departments, (b) schemes of
various departments and (c) different tiers of PRIs is needed for deriving maximum benefit
from decentralised governance.
23
By the 73rd Constitutional Amendment, 1992, the Panchayati Raj Institutions (PRIs) have
been given certain powers and responsibilities regarding health sector subject to devolution by
the state governments. Under this system the chief executive officer of Zilla Parishad (ZP)
and executive officer of Panchayat Samiti (PS) have powers in most of the states to exercise
control over the medical officials through annual confidential reports. Gupta and Gumber
(1999) have found that the quality of health care services have improved in the states by
ensuring better attendance of health care functionaries at the local level and by putting
pressure on the staff to carry out their duties in a regular manner. Community participation
through PRIs has helped in improving the supplies of drugs and equipment by bringing the
deficiencies in the supplies to the notice of higher authority.
It is noteworthy to mention the flip side of the decentralised governance. The theoretical
model framed by Tiebout way back in 1956 did not taken into account the already existing
inequality in the society in terms of income and power. By fiscal decentralisation, richer
jurisdictions will be able to collect more revenue since they have a larger tax base. Moreover,
these jurisdictions will be attractive places for households and enterprises as far as provision of
services is concerned. It will in turn lead to concentration of activities and growth
(Prud’homme 1994; Litvack et al 1998). There are also empirical evidences, which
corroborates to the above arguments (Qiao et al 2002). Lack of political accountability and
participation by the poor can worsen efficiency and equity in a decentralised system (Litvack
et al 1998). In this backdrop decentralisation of health care may not always result in equitable
and efficient provision of services.
In the subsequent section, we have analysed the spatial equity of our focus states, Kerala and
Madhya Pradesh. Among these two states, Kerala is socio-economically more developed than
Madhya Pradesh. We would see that initial condition of socio-economic well-being,
particularly public healthcare provision, matter in explaining the inequity and diversity.
3. Health Equity
Studies have argued that inequality has a negative impact on growth (Saint Paul and Verdier
1992, Galor and Zeira 1993, Benabou 1996). Inequality may pose constraint to economic
growth if it arises from lack of opportunities, political connections and forms of
discrimination that are often associated with the exclusion of some population groups from
24
the process of development (Ravallion 1997, Ravallion and Chen 2003, World Bank 2003).
Most of the deliberations on inequality have taken into consideration inequalities in the
distribution of income and other forms of material wealth. However, income alone does not
reflect the total wealth status of individuals; non-material wealth like health occupies a very
important position in everyone’s life. So analysis of inequality in health is as important as
analysis of income inequality.
3.1 Conceptual Framework
Health inequality can be gauged based on various dimensions. Economic class is one such
important dimension of health inequality. In India, there has been a striking economic class
differentials in the use of health services (Sen et al, 2002). It has been observed that health
inequality in India among different socio-economic class of population is substantial during
both mid 1980s and mid 1990s. Sen et al, based on NSSO data, had found that the class
gradient for untreated morbidity was highly significant and negative in both rural and urban
areas of India during 1986-87 and 1995-96. This implies that poor people are less likely to
get curative treatments for their illness than the rich are.
Besides curative care, another important aspect of health care system is preventive and
promotive care, which is often lacking in developing countries like India. In developing
countries, large segments of the population are unable to use cheap preventive methods to
avoid childhood health problems, poor maternal health and communicable diseases (World
Bank 1993). In many of the studies on India, preventive and promotive health care has been
advocated to contain communicable diseases and to built a comprehensive broad-based public
health policy (Baru and Sadhana 2000, Gill and Ghuman 2000).
Household income has a significant impact on the utilisation of preventive care. It has been
found that economic status is an important determinant of immunisation programme in
India (Gumber et al, 2001). According to Pradhan and Roy (2003), BCG vaccine has been
administered to a higher percentage among children from Above Poverty Line (APL)
households compared to Below Poverty Line (BPL) households. The manifestation of child
health also shows a bias towards better off households. The difference between Child Ever
Born (CEB) and Child Survival (CS) rate declines with increase in the income level of the
25
household. Infant Mortality Rate (IMR) is higher among the BPL households compared to
APL households.
In a study by Gumber et al (2001), it has been observed that in case of maternal care too,
socio-economic status of households plays an important role. In India, the proportion of
deliveries attended by health personnel and pregnant women receiving the tetanus toxoid
(TT) vaccine is much higher among APL population compared to BPL population in both
rural and urban areas. It has also been observed that maternal care like inpatient days related
to childbirth is mostly used by people from top expenditure quintiles. Moreover, the
percentage of home deliveries is more skewed towards the lower expenditure quintiles and
population below the poverty line.
Another important dimension of health inequality measurement is the rural-urban affiliation

(Duggal et al, 1995; Nandraj and Duggal, 1997; Sule, 1999). In India, the gap between rural
and urban areas in terms of development resources and services is striking and has persisted
despite more than half a century of development efforts after independence. In several studies
it is found that urban areas have attracted a larger share of health institutions, qualified
doctors and health workers than warranted by their share in the total population.
The NSSO report on Morbidity and Treatment of Ailments (52nd round, July 1995-June
1996) reveals a substantial difference in curative treatments between urban and rural India.
According to the report, the number of untreated persons per 1000 ailing persons stands at
173 for rural India and the same figure for urban India is only 93. In preventive health care, it
is found that BCG vaccine has been administered to a higher percentage among children in
urban areas compared to rural areas (Gumber et al, 2001). However, there is no significant
difference in Infant Mortality Rate between rural and urban areas (Pradhan and Roy, 2003).
In case of maternal care, Pradhan and Roy (2003) have found that the proportion of
deliveries attended by health personnel is much higher in urban areas compared to rural areas.
They have also observed that rural households neglect post-natal care.
3.2 Approach and Measurement Issues
The main objective of this section is to determine the extent of differentials among various
economic classes and rural and urban population with respect to certain health indicators.
26
The analysis is carried out for the two states, viz., Kerala (‘good performer’ in health status)
and Madhya Pradesh (‘bad performer’ in health status) on the basis of NSSO survey data
(52nd round) collected during July 1995 –June 1996. The estimates made in the paper are
based only on samples drawn by NSSO.
The NSSO surveys provide data tabulated across the monthly per capita consumption
expenditure (MPCE) fractiles of households. The empirical analysis of this paper has
considered MPCE as a rough proxy for economic (income) class. In the analysis, the range of
MPCE quartiles (also termed as consumption groups) is different for the two states as well as
for rural and urban areas within the same state. The different ranges of MPCE quartiles are
presented in Table 5.
Table: 5 Quartiles of Monthly Per Capita Consumption Expenditure (in Rs.)

Quartile Kerala Madhya Pradesh
Rural Urban Rural Urban
Up to 322 Up to 354 Up to 215 Up to 312
1
(25.2) (25.0) (24.9) (24.9)
322-412 354-481 215-277 312-415
2
(24.9) (24.9) (25.2) (25.1)
412-546 481-702 277-362 415-570
3
(24.9) (25.2) (24.9) (24.9)
Above 546 Above 702 Above 362 Above 570
4
(25.0) (25.0) (25.1) (25.0)
Note: Numbers in the parenthesis are the percentages of households under the group
The health indicators have been selected in such a way that they include both preventive and
curative care. The following indicators have been selected:
Preventive Care
1. Percentage distribution of households according to major source of drinking water
2. Percentage distribution of households according to types of latrine
27
3. Percentage of children (age between 0-4 years) administered with BCG, DPT and OPV
immunisation vaccines
4. Percentage of children (age between 0-4 years) administered with measles vaccines and
registered for paediatric care
5. Percentage of mothers of children born during the last 365 days (preceding the date of
survey) receiving maternal attention at child birth and registered for postnatal care
Curative Care
The NSSO data does not have detailed information on curative care. In the present section,
‘percentage of spells of ailment treated to total spells of ailment reported during the last 15
days preceding the date of survey by the members or deceased members of the household’ has
been considered as the only indicator to represent the extent of curative care.
The variation in all the above mentioned health indicators across the four consumption
groups (MPCE quartiles) and between rural and urban areas in both the states has been
captured through descriptive tables.
In addition, the dispersion with respect to a select health indicators has been estimated using
a number of inequality measures like the Gini coefficient and three Generalised Entropy
(GE) measures – the mean log deviation (MLD), the Theil index and half the squared
coefficient of variation. We have also decomposed the inequality measures in several groups.
The Gini measure is easy to calculate and interpret but it can only be decomposed under
special circumstance when the groups are non-overlapping. On the other hand, GE measure
does not suffer from this problem. GE also satisfies the five properties of inequality measures,
i.e, weak principle of transfers, income scale independence, principle of population,
decomposability and strong principle of transfers (Cowell, 1995). So we have considered both
these measures in out analysis. The Gini and GE measures of inequality are calculated for the
following health indicators:
1. Children (age between 0-4 years) administered with measles vaccines and registered for
paediatric care
2. Mothers of children born during the last 365 days (preceding the date of survey)
receiving maternal attention at child birth and registered for postnatal care
28
These indicators are converted into proportions at the household level and then inequality
measures are calculated8 . In our analysis, we have only calculated inequality measures and its
decomposition for those indicators for which inequality is found to be substantial. In case of
curative care, more than 80% of the cases have been found to be treated. That is why
inequality measure has not been calculated for it.
The Gini coefficient varies between zero (indicating no inequality) and one and is defined as
follows (Litchfield 1999):
n n
1
Gini =
2n2 h
∑∑ h
i =1 j =1
i − hj
where n is the number of individuals in the sample, h is the arithmetic mean of the health
indicator, hi is the value of the health indicator of individual i and h j is the value of the health
indicator of individual j. Members of the GE class of measures have the following general
formula:
 1 n  hi  α 
GE(α ) = 2
1
 ∑   − 1
(
α −α )  n i=1  h  
where ? is a parameter that represents the weight given to distances between the value of the
indicator at different parts of the distribution, and can take any real value. The most
commonly used values of alpha are 0, 1 and 2. A value of alpha = 0 gives more weight to
distances between values of the indicator in the lower tail, alpha = 1 applies equal weights
across the distribution, while a value of alpha = 2 gives proportionately more weight to gaps
in the upper tail. The GE measures with parameters 0 and 1 become, with I’Hopital’s rule,
two of Theil’s measures of inequality, the mean log deviation [GE(0) or MLD] and the Theil
index [GE(1)] respectively, and with parameter 2 becomes half the squared coefficient of
variation [referred to as GE(2) here] (Litchfield, 2003).
The contribution of MPCE quartiles and rural-urban affiliation to overall inequality of the
health indicators has been examined by decomposing the inequality measures mentioned
above into within- and between- group inequality components (see Cowell, 1995 for the
methodology and Litchfield, 2003 for an application to Brazil). In the analysis, the overall
8
For example, if there are two children (age between 0-4 years) in a household and one has been administered
with measles vaccine, then the value of the indicator for that household would be ½ (0.5).
29
inequality has been decomposed into within- and between MPCE quartiles and within- and
between rural-urban areas.
Any of the GE class of measures can be decomposed by population sub-groups so that the
overall inequality (I) can be separated into within-group (I w) and between group (Ib)
inequality as follows (Cowell and Jenkins, 1995):
I = Iw + Ib
Within-group inequality is defined as a weighted sum of inequality within each of the sub-
groups where the weights are population shares, relative values of the indicator or some
combination of these two depending on the inequality measure used:
k
I w = ∑ ϑ jGE (α ) j
j =1
where ϑ j = v αj f j1−α , f j is the population share and vj the share of the indicator of each group
j (j=1,2,….k).
Between-group inequality is computed by assigning the mean value of each group j, , to each
member of the group and calculating:
1  k  h j 
α

Ib = 2 ∑ jf
α − α  j=1  h 
− 1

 
Cowell and Jenkins (1995) suggested an intuitive summary measure, Rb, of the amount of
inequality explained by differences between groups with a particular characteristic or set of
characteristics, Rb = Ib / I. Hence, it may be concluded that x% of the total inequality is
“explained” by between group inequalities, and (100-x)% is accounted for by inequalities
within groups.
3.3 Results
Drinking Water and Sanitation
The combination of safe drinking water and hygienic sanitation facilities is a precondition for
good health. The way people secure their drinking water has a direct impact on their health.
30
In households using unprotected source, health can be jeopardised by water contamination.
Unhygienic sanitation facilities also have an adverse impact on an individual’s health.
The major source of drinking water in Kerala is the pucca wells (Table 6). Around 80 per
cent of the households in the rural areas and 56 per cent in urban areas of Kerala use pucca
well whereas only 10 per cent in rural areas use tap water which is considered as the safest
medium. This share is quite high for urban areas of Kerala where 38 per cent use tap water.
As one moves up the MPCE quartiles, the proportion of households using pucca wells in the
urban areas of Kerala decreases from around 64 per cent to 44 per cent. This proportion
increases from 30 per cent to 53 per cent in case of usage of tap water.
Tube wells/handpumps and pucca wells are the main sources of drinking water for more than
80 per cent of the of the households in the rural areas of Madhya Pradesh across all the
MPCE quartiles (Table 6). In urban Madhya Pradesh, around 75 per cent of the households
are using tap water - the safest source of drinking water.
Thus, tap water, which is considered as the safest source of drinking water, is not the main
source for the households in these two states except for urban areas of Madhya Pradesh.
Pucca wells or tube wells/hand pumps are mostly used in both the states.
31
Table 6: Percentage Distribution of Households According to Major Source of Drinking
Water
Type Quartile Quartile Quartile Quartile Total
State Area
1 2 3 4
Tap 10.9 10.8 9.2 9.1 10
Tube-well/ 1 0.1 0.4 0.4 0.5
handpump
Tanker 1 0.3 0.3 0.3 0.5
Pucca Well 77.8 80.7 79.9 82.4 80.2
Rural
Tank/ pond reserved 2.6 1.4 2 1.1 1.8
for drinking
river/ canal 0.3 0.3 0 0 0.1
others 6.4 6.3 8.2 6.6 6.9
All 100 100 100 100 100
Kerala
Tap 30.1 33.7 39 53 38.9
Tube-well/ 2.1 2.1 1.2 1.2 1.6
handpump
Tanker 1.3 1.2 1.2 0.6 1.1
Pucca Well 63.6 61.1 56.2 43.5 56.1
Urban
Tank/ pond reserved 0.2 0 0 0 0
for drinking
river/ canal 0 0 0 0 0
others 2.7 1.9 2.5 1.7 2.2
All 100 100 100 100 100
Madhya Rural Tap 4.5 4.7 6.6 5.8 5.4
Pradesh Tube-well/ 56.2 54.8 54.8 56.8 55.6
handpump
Tanker 0.7 0.4 0.5 0.2 0.5
Pucca Well 25.6 32.6 32.4 32.9 30.9
Tank/ pond reserved 0.8 0.8 0.2 0.2 0.5
for drinking
32
Type Quartile Quartile Quartile Quartile Total
State Area
1 2 3 4
river/ canal 7 4.1 2.6 1.9 3.9
others 5.2 2.8 3 2.2 3.3
All 100 100 100 100 100
Tap 64.7 72 79.2 83.9 74.9
Tube-well/ 20.4 17.1 14.7 10.6 15.7
handpump
Tanker 0.6 0.1 0 0.2 0.2
Pucca Well 13.2 9.1 5.6 4.9 8.2
Urban
Tank/ pond reserved 0.4 0.6 0.1 0 0.3
for drinking
river/ canal 0.2 0.1 0.1 0 0.1
others 0.5 0.9 0.2 0.4 0.5
All 100 100 100 100 100
Septic tank is considered to be the most hygienic source of sanitation. It is only the urban
areas of Kerala, which have around 41 per cent of the households as compared to only 34 per
cent households in the urban areas of Madhya Pradesh who use septic tanks (Table 7).
Statistics reveal that a large percentage of households do not have latrine especially in the
rural areas of Kerala and Madhya Pradesh. Around 97 per cent of the rural households and
34 per cent of the urban households in Madhya Pradesh have no latrine in their houses. The
figures are comparatively low for Kerala where only 25 per cent of the households in rural
areas and 10 per cent in the urban areas have no latrine.
In rural and urban areas of both the states, the percentage of households without latrine
decreases as we move up the quartile and this decrease is more prominent in urban Madhya
Pradesh from 58 per cent in quartile 1 to 10 per cent in quartile 4. The usage of septic tanks
increases with the increase in consumption quartiles in both the states.
33
Table 7: Percentage Distribution of Households According to Type of Latrine
State Area Type Quartile 1 Quartile 2 Quartile 3 Quartile 4 Total
No Latrine 39.5 26.9 21.7 10.8 24.7
Service Latrine 2 2.5 1.1 1.4 1.8
Septic Tank 9.1 14.1 17.5 30 17.7
Rural
Flush System 0 0.3 0.6 1.7 0.6
Others 49.5 56.2 59.1 56.1 55.2
All 100 100 100 100 100
Kerala
No Latrine 17.7 10.1 7.3 1.2 9.1
Service Latrine 3.5 1.9 1.9 0.6 2
Septic Tank 30.3 33.8 44.1 55.5 40.9
Urban
Flush System 0.8 1.2 4.2 9.8 4
Others 47.8 53 42.4 32.9 44
All 100 100 100 100 100
No Latrine 98 97.6 97.3 96.2 97.3
Service Latrine 0.8 0.4 0.6 0.5 0.6
Septic Tank 0.5 0.5 1.4 2.8 1.3
Rural
Flush System 0 0 0.1 0.1 0
Others 0.7 1.5 0.6 0.5 0.8
Madhya All 100 100 100 100 100
Pradesh No Latrine 58 42.3 25.2 10.3 33.9
Service Latrine 10.3 9.6 9.8 8.5 9.6
Septic Tank 21.2 32.1 39.1 41.6 33.5
Urban
Flush System 6.9 13.4 25 39.1 21.1
Others 3.7 2.7 0.9 0.5 1.9
All 100 100 100 100 100
Immunisation and Paediatric Care
A high percentage (around 90 per cent) of the children in the age group of 0-4 years have
been immunised in Kerala and Madhya Pradesh for BCG, DPT and OPV except in the case
34
of BCG in rural Madhya Pradesh where only 64 per cent of the children are immunised as
compared to 86 per cent in urban areas (Table 8).
The percentage of children (in the age group 0-4 years) vaccinated against measles is quite
low in both the states (Table 8). Only 50 per cent of the total children in the age group of 0-4
years are vaccinated against measles in rural Kerala as compared to 61 per cent in urban areas.
In Madhya Pradesh, rural areas are lagging behind urban areas where 45 per cent of the
children are vaccinated as compared to 63 per cent in urban areas.
With regard to paediatric care, only 50 per cent of the children (in the age group 0-4 years)
are registered in rural areas of Madhya Pradesh and 57 per cent in rural Kerala (Table 8).
Urban areas of both Kerala and Madhya Pradesh have slightly more than 60 per cent of the
children registered for paediatric care.
35
Table 8: Percentage of Children (in the Age Group 0-4 Years) who have Undergone
Immunisation Programme and Registered for Paediatric Care
Measles Paediatric
State Area Quartile BCG DPT OPV
Vaccine Care
1 93.53 97.70 97.08 51.15 55.95
2 93.99 97.60 95.19 53.13 58.41
Rural 3 90.54 94.32 93.69 47.00 55.21
4 93.07 97.84 96.54 47.19 59.31
Total 92.93 96.95 95.70 50.17 57.03
Kerala
1 98.32 88.97 87.77 67.63 61.15
2 98.08 89.46 89.78 56.55 53.04
Urban 3 99.03 92.27 92.27 61.84 65.70
4 99.34 84.77 85.43 54.30 76.82
Total 98.53 89.15 88.88 61.49 61.86
1 56.46 97.72 97.00 35.57 46.48
2 70.29 98.59 98.05 48.54 51.90
Rural 3 69.01 98.59 98.16 50.05 50.16
4 70.47 97.72 96.74 53.18 57.10
Madhya Total 64.99 98.14 97.50 44.82 50.30
Pradesh 1 81.24 73.07 73.62 56.73 62.91
2 88.54 77.74 77.57 65.95 65.61
Urban 3 92.16 81.37 82.35 69.61 66.18
4 93.52 84.62 82.59 68.83 59.92
Total 86.73 77.25 77.39 63.11 63.94
The inequality coefficients of immunisation for BCG, DPT and OPV turned out to be very
low indicating almost no inequality and hence they have not been reported here. As far as the
inequality measure in measles vaccination is concerned, the Gini coefficient is higher for
rural areas as compared to urban areas of Kerala and Madhya Pradesh at 0.50 and 0.56
36
respectively indicating high inequality in the proportion of children vaccinated against
measles in rural areas (Table 9). Within group inequality has contributed more than 97 per
cent of the total inequality across all the regions and states. For details of decomposition of
inequality see Table A2 in the Appendix.
Table 9: Inequality in the Proportion of Children Administered with Measles Vaccine to

Total Children (in the age group 0-4 Years) in a Household
Within Group
State Region Group Gini GE (1)
Contribution (%)
Total Rural/Urban 0.45413 0.53753 99.01
Rural MPCE 0.50267 0.62903 99.90
Kerala Quartiles
Urban MPCE 0.38932 0.42710 99.04
Quartiles
Rural MPCE 0.55624 0.73775 98.39
Madhya
Quartiles
Pradesh
Urban MPCE 0.36939 0.39276 98.85
Quartiles
The inequality coefficients for paediatric care reveals that inequality is more pronounced in
the rural areas. The Gini coefficient for rural areas of Kerala and Madhya Pradesh is 0.43 and
0.50 respectively as compared to 0.37 and 0.36 for urban areas (Table 10). Within group
inequality has contributed more than 98 per cent of the total inequality across all the regions
and states (see details of decomposition of inequality in Table A3 in the Appendix).
37
Table 10: Inequality in the Proportion of Children Registered for Paediatric Care to Total
Children (in the age group 0-4 Years) in a Household
Within Group
State Group Gini GE (1)
Region Contribution (%)
Rural MPCE 0.42646 0.54246 99.91
Kerala Quartiles
Urban MPCE 0.37432 0.45383 98.54
Quartiles
Rural MPCE 0.50123 0.66458 99.63
Madhya
Quartiles
Pradesh
Urban MPCE 0.36076 0.42561 99.78
Quartiles
Maternal Care
In both rural and urban areas of Kerala, proportion of mothers receiving medical attention at
the time of childbirth is quite high at around 97 per cent. In the rural areas of Madhya
Pradesh the proportion is as low as 58 per cent (Table 11). Urban areas of Madhya Pradesh
are still better than rural areas and it is here that one can observe an increase in the
percentage as we move up the quartile. Though the overall percentage of mothers receiving
medical attention at child birth is around 78 per cent in urban Madhya Pradesh, this figure
in quartile 4 (the highest consumption group) is 94 per cent. Despite the fact that a very high
proportion of mothers in Kerala (both rural and urban) have received medical attention
during child birth, very few are registered for post natal care. The figure is only 58 per cent
for both rural and urban areas of Kerala (Table 11). Madhya Pradesh has only 30 per cent of
the mothers registered for post-natal care in rural areas and 46 per cent in urban areas.
38
Table 11: Percentage of Mothers of Children Born during last 365 Days (Preceding the Date
of Survey) who have Undergone Maternity and Post-natal Care
Maternal
Registered for
State Area Quartile Attention at Child
Post-natal Care
Birth
1 95.29 51.76
2 97.70 60.34
Rural 3 96.43 57.14
4 96.55 65.52
Total 96.50 58.17
Kerala
1 97.71 53.44
2 95.90 53.28
Urban 3 98.94 61.70
4 98.70 71.43
Total 97.64 58.49
1 56.83 30.22
2 61.42 31.05
Rural 3 55.97 28.62
4 59.09 34.09
Total 58.29 30.68
Madhya Pradesh
1 73.18 41.06
2 75.35 46.98
Urban 3 84.25 50.68
4 94.44 56.48
Total 78.86 46.69
The Gini coefficient with respect to maternal attention at childbirth for Kerala is 0.03 which
is substantially lower than that in Madhya Pradesh where it is 0.35 (Table 12). This signifies
that Kerala has much lower inequality compared to Madhya Pradesh in case of maternal
attention at childbirth. Within group inequality has contributed more than 97 per cent of the
39
total inequality across all the regions and states (see Table A4 in the Appendix for details of
decomposition of inequality).
Table 12: Inequality in the Proportion of Mothers Receiving Medical Attention at

Childbirth to Total Mothers of Children Born during the last 365 Days
(Preceding the date of Survey) in a Household
Within Group
State Region Group Gini GE (1) Contribution
(%)
Kerala Rural MPCE Quartiles 0.03691 0.03760 99.89
Urban MPCE Quartiles 0.02244 0.02270 99.89
Madhya
Rural MPCE Quartiles 0.42343 0.54352 99.87
Pradesh
Urban MPCE Quartiles 0.21192 0.23699 98.19
The high inequality with respect to post-natal care in Madhya Pradesh is clearly reflected in
the Gini coefficient, which stands at 0.64 as compared to 0.41 for Kerala (Table 13). The
Gini for rural areas of Madhya Pradesh is very high at 0.7 as compared to 0.42 for the rural
areas of Kerala. Within group inequality has contributed more than 97 per cent of the total
inequality across all the regions and states (see Table A5 in the Appendix for details of
decomposition of inequality).
40
Table 13: Inequality in Proportion of Mothers Registered for Post-natal Care to Total
Mothers of Children Born during the last 365 Days (Preceding the date of Survey) in a
Household
Within Group
State Region Group Gini GE (1) Contribution
(%)
Rural MPCE 0.42264 0.54406 99.36
Kerala Quartiles
Urban MPCE 0.41521 0.53502 98.90
Quartiles
Rural MPCE 0.70280 1.19393 99.88
Madhya
Quartiles
Pradesh
Urban MPCE 0.53617 0.76257 99.02
Quartiles
Illness Cases Treated out of the Total Reported Cases

Overall, the proportion of cases treated out of those reported ailing is quite high for both
Kerala and Madhya Pradesh (Table 14). In the urban areas of Kerala and Madhya Pradesh,
over 90 per cent of the cases reported ailing in the last 15 days have been treated. In rural
areas of Kerala, this figure stands at 88.6 per cent whereas in Madhya Pradesh, it is around 85
per cent. The inequality coefficients for this indicator turned out to be very low indicating
almost no inequality and hence they have not been reported here.
41
Table 14: Percentage of Spells of Ailment Treated out of Total Ailment Reported during the
Last 15 Days (Preceding the Date of Survey)
Kerala Madhya Paradesh

Quartile Rural Urban Rural Urban
1 86.33 89.57 82.72 91.30
2 90.23 90.55 85.38 93.37
3 86.99 93.17 84.36 92.90
4 91.30 87.21 89.30 98.21
Total 88.69 90.22 85.43 93.84
To sum up, the results reveal that major portion of health inequality is accounted for by the
inequality within groups rather than between groups. The high contribution of within group
inequality to total inequality with respect to all the relevant health indicators indicates a high
level of heterogeneity within the groups than across groups. The Gini coefficients for the
select health indicators in the study bring out that inequality in health is more pronounced in
the rural areas as compared to urban areas for both the states. The inequality coefficients are
generally the highest for rural Madhya Pradesh for all the health indicators showing
maximum inequality in this region. The study reveals that inequality in access to healthcare is
higher in state where socio-economic conditions, particularly public healthcare facilities, is
lower.
4. Private and Public Health Service Providers: A Comparison
Although 1991 is identified as the year in which India formally launched reforms aimed at
greater deregulation, liberalisation and privatisation, the reforms in the health sector had
already started from the 1980s (Sen et al, 2002). There was a growing state support for
private hospitals and health sector privatisation together with a declining share of public
hospitals and dispensaries in public health expenditures since 1980s (Duggal et al 1995). In
the 1990s, a number of corporate hospitals had come up on land allotted to them by the
government in prime urban locations, in exchange for their providing a proportion of their
42
services free to the poor (Baru, 2000). There is increasing evidence of non-compliance with
this condition by major private hospitals (Sen et al, 2002). Moreover, one of the important
intentions of the government to support corporate hospitals is to set the standard for medical
technology and interventions but the NSSO survey results in the mid-1990s clearly reveal
that the privatisation of health care system in India has contributed to the increases in health
costs.
It is true that some of the collaborative initiatives between the public and private sectors are
innovative and could improve quality and accessibility. But the most important issue of these
collaborative ventures is proper regulation and the extent to which they seek to address the
needs of the people of India, especially those who belong to the weaker sections of the
society. It has be to kept in mind that corporatisation may help to improve the managerial
efficiency of the health sector but it may not really address the issue of accessibility in remote
areas. Further, the qualifications of the private practitioners and their charges need to be
carefully reviewed to ensure quality of care and equity.
Keeping in view the above concerns, the present section seeks to make a comparison between
public and private health service providers with respect to accessibility, quality of treatment
and costs. The comparison is restricted to two states, viz., Kerala (a ‘good performer’ in health
status) and Madhya Pradesh (a ‘bad performer’ in health status) and it is carried out on the
basis of NSSO survey data (52nd round) collected during July 1995 –June 1996. The
comparison made in this section is based only on samples. The public facilities include
government hospitals, dispensaries, community health centres, primary health centres and
sub-centres while the private health facilities include private hospitals, nursing homes, private
clinics and dispensaries.
4.1 Health Care Use: Public Private Mix
For the purpose of analysing the health care use in Kerala and Madhya Pradesh, the high
incidence diseases have been identified (Table 15). It is interesting to note that in Kerala
(both rural and urban areas), private service providers are used by majority of the people for
inpatient as well as outpatient care. A similar trend is discernible with respect to outpatient
care in rural as well as urban Madhya Pradesh. In case of inpatient care, majority of the
people of Madhya Pradesh still accesses the public health service provider.
43
At the all India level, the mid-1990s NSSO survey results depict a similar pattern as that of
Kerala; however, in mid-1980s the usage pattern was similar to that of Madhya Pradesh.
Table 15: Percentage of Spells of Ailments Treated in Public and Private Health care
Facilities
Nature Rural Urban
State of Inpatient Outpatient Inpatient Outpatient
Ailment Private Public Private Public Private Public Private Public
101 66.00 34.00 63.60 36.40 58.60 41.40 75.00 25.00
106 74.00 26.00 76.90 23.10 65.90 34.10 77.40 22.60
114 61.20 38.80 67.90 32.10 68.00 32.00 83.00 17.00
Kerala
115 63.00 37.00 63.20 36.80 62.50 37.50 100.00 0.00
224 54.90 45.10 60.00 40.00 70.60 29.40 59.10 40.90
ALL 62.80 37.20 72.30 27.70 63.00 37.00 74.20 25.80
101 13.80 86.20 72.10 27.90 23.10 76.90 65.30 34.70
106 36.20 63.80 79.70 20.30 33.30 66.70 76.50 23.50
Madhya 114 53.80 46.20 81.80 18.20 50.00 50.00 90.30 9.70
Pradesh 115 42.90 57.10 82.60 17.40 50.00 50.00 87.50 12.50
224 45.00 55.00 100.00 0.00 41.90 58.10 82.40 17.60
ALL 37.80 62.20 80.00 20.00 37.90 62.10 76.70 23.30
Notes: 101= Diarrhoea & Gastro-enteritis Dysentery (Including Cholera), 106= Fevers of
Short Duration, 114= Cough and Acute Bronchitis, 115= Acute Respiratory Infection, 224=
Disease of Heart
4.2 Accessibility and Quality of Treatment
The NSSO survey does not give adequate information relating to distance of the health
facility centre and quality of treatment. Even qualitative issues regarding accessibility and
quality of treatment are not covered in a comprehensive manner. The survey has only
enumerated the reasons for receiving treatment from non-government (private) service
providers. Based on these responses, an attempt has been made to compare the public and
private service providers with respect to accessibility and quality of treatment. It has to be
44
kept in mind that this analysis is based on a very thin sample of respondents and it does not
cover respondents taking inpatient care.
For people, who prefer treatment from non-government (private) sources to government
sources, access is a reason for such a preference. 43.7 per cent of the cases in rural areas and
33.2 per cent in the urban areas of Kerala feel that either the government doctor/facility is
located far off or the private doctor is easily available as compared to the government doctor
(Table 16). The situation is more severe in case of rural Madhya Pradesh where 63 per cent
of the cases feel that accessibility is the major reason governing their choice for a private
source apart from the level of dissatisfaction with the treatment in a government facility.
With regard to the quality of treatment, more than 30 per cent of the cases in both rural and
urban Kerala have reported to be dissatisfied with the treatment of the public service provider
(Table 16). Similar trend is observed in case of Madhya Pradesh as well.
Table 16: Percentage Distribution of Reasons for Receiving Treatment from Non-
Government Sources Cited by Members Ailing for last 15 days
(Preceding the Date of Survey)
Reasons
Rural Urban Rural Urban
Govt. Doctor/ Facility Too Far 12.8 7.8 39 6.7
Not Satisfied With Treatment 32.4 34.2 23.8 37.1
Long Waiting 3.7 5 0.4 5.2
Lacks Personal Attention 4.7 6.1 2.3 3.8
Bad Treatment 2.8 0.8 1.8 2.1
Doctor/ Staff Corrupt/ Charge Money 0.3 1.1 1.1 1
Medicines Not Available or Ineffective if 2.5 4.6 6 11.9
Available
Private Doctor More Easily Available 30.9 25.4 23.8 26.6
Others 9.7 14.9 1.8 5.7
Total 100 100 100 100
45
4.3 Medical Expenditure and Transport Cost
The medical expenditure 9 per spell of ailment in case of inpatient care is almost half in case of
public service provider in both the states (Table 17). In case of outpatient care, the medical
expenditure is nearly similar for both public and private service providers except in case of
urban Madhya Pradesh where it is nearly double in public service provider as compared to its
private counterpart (Table 18). The interesting point to note here is that the medical
expenditure in the private sector in Kerala (which is a better managed state as compared to
Madhya Pradesh with respect to government health facilities) is substantially lower than the
private sector expenditure in Madhya Pradesh (Table 17 and 18). This trend is also true in
case of high incidence diseases (see Tables A6 – A9 in the Appendix). Krishnan (1995) has
found similar results wherein states with better public health services have lower prices in the
private sector.
Transport cost incurred for accessing public inpatient care is lower compared to the private
service provider except for rural Kerala. On the other hand, with respect to outpatient care,
patients incur substantially higher transport cost in accessing the public service providers in
both the states baring urban Kerala. This, in a way, reflects the proximity problems of public
service providers for outpatient care.
9
Medical expenditure includes bed charges, medicine costs, doctors’ fees, ambulance charges and other charges
which are part of treatment.
46
Table 17: Average Medical Expenditure for Treatment during the Stay in Hospital and
Transport Cost other than Ambulance for Inpatient Care (Rs. per spell of ailment)
Rural Rural Urban Urban Rural: Urban Rural: Urban
State Type Medical Transport Medical Transport Medical Transport
Expenditure Cost Expenditure Cost Expenditure Cost
Private 3029.51 122.66 2453.15 94.94 1.23 1.29

Public 1549.85 146.49 1598.71 92.45 0.97 1.58
Kerala
Public :
0.51 1.19 0.65 0.97
Including Private
Zero Private 4009.77 212.89 4859.14 262.80 0.83 0.81
Madhya Public 1904.36 191.73 2289.18 149.86 0.83 1.28
Pradesh Public :
0.47 0.90 0.47 0.57
Private
Private 3053.74 129.22 2475.30 105.83 1.23 1.22
Public 1659.30 155.09 1741.11 104.49 0.95 1.48
Kerala
Public :
0.54 1.20 0.70 0.99
Excluding Private
Zero Madhya Private 4026.83 249.96 4877.76 397.99 0.83 0.63
Pradesh Public 1983.52 234.34 2367.73 259.19 0.84 0.90
Public :
0.49 0.94 0.49 0.65 1.01 1.44
Private
47
Table 18: Average Medical Expenditure Incurred during the last 15 Days (Preceding the
Date of Survey) for Treatment and Transport and Lodging Charges for Outpatient Care
(Rs. per spell of ailment)
Rural:
Rural Rural Urban Urban Rural: Urban
Urban
Transport Transport Transport
State Type
Medical and Medical and Medical and
Expenditure Lodging Expenditure Lodging Expenditure Lodging
Charges Charges Charges
Private 128.19 20.76 140.93 22.55 0.91 0.92

Public 130.29 34.30 114.00 15.53 1.14 2.21
Kerala
Public:
1.02 1.65 0.81 0.69
Including Private
Zero Private 205.03 13.58 284.75 77.36 0.72 0.18
Madhya Public 200.62 20.45 548.54 87.90 0.37 0.23
Pradesh Public:
0.98 1.51 1.93 1.14
Private
Private 128.62 20.76 140.93 22.55 0.91 0.92
Public 133.35 34.30 114.00 15.53 1.17 2.21
Kerala
Public:
1.04 1.65 0.81 0.69
Excluding Private
Zero Private 207.67 46.50 285.31 77.36 0.73 0.60
Madhya Public 207.87 62.82 561.01 87.90 0.37 0.71
Pradesh Public:
1.00 1.35 1.97 1.14
Private
5. Choice of Health Care Provider
Estimates based on the NSSO survey of 1986-87 show that while patients increasingly
resorted to the private sector for outpatient services, public hospitals were still dominant
providers of inpatient care especially for the poor (Sen et al, 2002). But during the mid 1990s,
the increasing importance of private health sector was felt in inpatient care. Studies have
48
shown that even the poor prefer the private health care services as against the public health
care services (Gupta and Dasgupta 2002, Gupte et al 1999, Shatrugna et al 1993, Yesudian
1999, Pradhan and Roy 2003).
The reasons for greater preference towards private services are perceived better quality of
treatment, faith in the service, proximity to the household and convenience of timing. By
better quality of health service people perceive early cure, good supply of drugs, personalised
services, good doctor and good nursing care. There is also lack of responsibility and
accountability on the part of doctors in public health care system (Gill and Ghuman 2000).
Due to poor quality of health services at lower levels (dispensary) of public sector, people
queue in the higher level public hospitals making the system inefficient by misuse and
overuse. Gill and Ghuman (2000) have found that most of the rural dispensaries and sub-
centres in Punjab are without proper buildings and arrangement of water supply, electricity
and sanitation.
Apart from all these reasons, choice of the type of health care also depends on some other
socio-economic parameters along with income. Age, gender, caste, education and rural-urban
affiliation of the patients are some of the important socio-economic parameters, which have
strong bearings on the choice of service provider. The present section has tried to establish a
relationship between the choice of service provider and the above-mentioned parameters.
5.1 Conceptual Framework

The determinants of choice of health care provider between public and private have been
estimated through a health care provider function. The health care provider function can be
specified as:
P = α 1 + α 2G + α 3 S + α 4C + α 5 I + α 6 A + u r
where P =1, if the provider is public
=0, if provider is private
G = age of the patient, S= gender, C= caste, I= income, A= rural-urban affiliation
49
5.2 Results
In case of both Kerala and Madhya Pradesh, the maximum likelihood estimates of the above
function have been calculated using Probit Model for both inpatient and outpatient care. In
the model, monthly per capita consumption expenditure (MPCE) has been used as a proxy of
income, since NSSO does not provide information regarding income. The independent
variables that are found to be significant are age, caste, MPCE and rural-urban affiliation,
though all of these are not significant in each case. On the other hand, gender has not found
to be significant in any of the cases.
Kerala Outpatient
The maximum likelihood estimates of the determinants of choice of health care provider
between public and private for outpatient care of Kerala has been reported in Table19. The
estimates reveal that as age of the patient increases the probability of choosing public health
care increases for outpatient care. This may happen presumably because the aged people can
easily adjust with inconvenient timing and long waiting time for outpatient care. The
Scheduled Caste (SC) and Scheduled Tribe (ST) patients, who belong to the lower social
groups, have greater probability of choosing public health care vis-à-vis patients from general
caste. Moreover, the probability of choosing public health care provider is very less among
high-income people (surrogated by MPCE in this analysis). This is probably due to the fact
that richer people have the affordability to pay the higher charges of the private health service
provider. It implies that those willing and able to pay more access the private sector and those
willing but not able to pay more, access the government sector. Sex and rural-urban
affiliation are found to have insignificant impact on the choice of service provider.
Kerala Inpatient
The determinants of choice of type of service provider between public and private with
respect to inpatient health care in Kerala has been reported in Table19. The results
demonstrate that the probability of choosing public health care provider is higher if the
patient is SC or ST rather than from general caste. Also, richer people have the preference for
private service provider. Age, sex and rural-urban affiliation are found to have statistically
insignificant impact on the choice of service provider.
50
Madhya Pradesh Outpatient
The determinants of the choice of health care provider for outpatient care in Madhya
Pradesh have been represented in Table19. The result reveals that the probability of choice of
public services for outpatient care in Madhya Pradesh is higher among the patients belonging
to SC or ST as compared to patients from the general caste. The probability of choosing
public service provider is lower among the people in the rural areas as compared to those
residing in the urban areas of Madhya Pradesh. This may be due to the lack of availability
and poor infrastructure/quality of outpatient care in rural areas compared to urban areas of
Madhya Pradesh. Age, sex and income are found to be statistically insignificant.
Madhya Pradesh Inpatient
In case of inpatient care in Madhaya Pradesh, the maximum likelihood estimates of

determinants of choice of health care provider are illustrated in Table19. The results reveal
that as age increases the probability of choosing public service provider for inpatient care in
Madhya Pradesh increases. Similarly, SC or ST patients have a higher probability of
accessing the public service provider than the patients from general caste.
The results also reveal that rich people in Madhya Pradesh have preference for private service
providers. Interestingly, rural people of the state have higher probability of selecting private
service provider for inpatient care. This may be due to the non-availability and/or poor
quality of treatment in public inpatient care in rural areas compared to urban areas of Madhya
Pradesh.
51
Table 19: Maximum Likelihood Estimates of the Determinants of Choice of Service
Provider for Outpatient and Inpatient Care

Outpatient # Inpatient # Outpatient # Inpatient #
age (in years) 0.00067* 0.00074 0.00025 0.00122**

Sex (Male=1, Female = 0) -0.01195 -0.02903 0.02558 0.02620
Caste (SC/ST = 1, Others = 0) 0.09338*** 0.14438*** 0.06822*** 0.07933***
MPCE (in Rs) -0.00020*** -0.00012*** -0.000003 -0.00036***
Rural-urban affiliation (Rural =1, 0.00067 -0.01013 -0.04872** -0.07883***
Urban = 0)
Log-likelihood 43.46 40.14 13.11 65.90
Prob>Chi2 0.0000 0.0000 0.0224 0.0000
No. of Observations 2096 1804 1729 1502
* Significant at 10% level, ** significant at 5% level and *** significant at 1% level
# Marginal effects, not coefficients, have been represented in the columns
The analysis suggests that caste and income (MPCE) of the patients are important
determinants of type of service provider. It has been found that in both Kerala and Madhya
Pradesh, lower caste and poor people have higher chances of getting treated in public sector
rather than in private sector for both outpatient and inpatient care. It implies that in both the
states, irrespective of their high or low health status, lower caste and poor people get
discriminated in the private sector. Another interesting finding is that in Madhya Pradesh,
public services are insufficient or qualitatively lower in rural areas compared to urban areas for
both outpatient and inpatient care. However, this is not the case in Kerala.
6. Summary and Conclusions
As a welfare state, India is committed to the welfare and development of its people. Health is
an important sector and investment in this sector can be considered to be a part of the
investment in human capital, which would have productivity and growth enhancing effects
through several channels. Since independence, the government of India, through various
planning processes, has been focussing on health conditions of the people of India and it has
52
amply taken proactive measures in involving the government in the provision of health care
services to its citizens. Currently, government health care provision is operating through
multiple regulation, schemes and programmes, which are implemented by various
departments and directorates of central and state governments.
The prevalence of inefficiencies in public health system in the form of mis-targeting,

deterioration in quality of services provided and bankruptcy faced by governments had
stimulated a debate on the issue of government’s involvement in the provision of health
services. Since the onset of economic reforms in India in 1991, this debate took a strong turn.
Recognising the fact that inefficiencies were rampant in public health care system and that
public spending on health forms only a minuscule proportion of the total spending on health,
recommendations from various quarters argued for cuts in government spending on health
services, opening up of medical care to private sector and the introduction of cost recovery
mechanisms in public hospitals
The emphasis of the government of India to reduce its stake from the health care system and
the opening up of medical care to private sector is manifested in the significant shift of
treatments from public health facilities to private ones during mid 1990s as compared to mid
1980s.
In India, the issues relating to regulations and various health schemes and programmes of the
central and state governments are very important keeping in mind that the health care use in
India has a mix of public and private sectors. The government of India has several health
programmes, which are running across the country. These programmes are meant to curb the
incidence of Vector Borne Diseases (VBDs) such as filariasis, Japanese encephalitis (JE),
kala-azar and dengue. Moreover, to control and reduce the incidence of leprosy and
tuberculosis, national programmes are in vogue. Overall, the programmes have positive
impacts on the health condition of the people of India.
The government of India has also initiated national programmes aiming to reduce maternal
and infant mortality rates. Important to mention is the Universal Immunisation Programme,
which was initiated in 1985 to control vaccine preventable diseases among the infants and
children. Significant drop in infant mortality rate during 1990s compared to that in 1970s
and 1980s is attributable to this programme.
53
In the regulation side, government of India has several standing acts to control various
activities in the health sector. However, certain issues need much more attention than what is
being given currently. It is surprising to know that more than 20 per cent of illness cases in
rural India are treated by either traditional healers or unqualified private doctors. In urban
areas, the figure is presumably similar. This is despite the fact that the Medical Council of
India under Indian Medical Council Act, 1956 has been made responsible for registration of
doctors and their qualifications, maintaining uniform standard of medical education and
maintenance of Indian Medical Register. Another important issue of regulation is the quality
of drugs. The Central Drugs Control Organisation along with Drug Control Organisation in
the states are responsible for safety, efficacy and quality of drugs, their import, manufacture,
distribution, sale and standards. Drug testing laboratories have also been set up in Kolkata,
Ghaziabad, Chennai, Mumbai and Guwahati. Even in the presence of all these existing
regulators, the trade of spurious drugs is quite significant in rural as well as urban areas of
India. The government of India has standing act to contain the declining sex ratio and for
curbing the menace of female foeticide. Despite this, in private hospitals, a substantial
number of sex determination cases and abortions take place along with abortions by
traditional healers and birth attendants.
The empirical analysis of this paper has focus on (i) health equity (ii) comparison between
private and public sector service providers with respect to medical expenditures and quality of
treatment and (iii) determinants of service providers. Two Indian states, viz., Kerala (a ‘good
performer’ in terms of health status) and Madhya Pradesh (a ‘bad performer’ in terms of
health status) have been selected for the purpose of analysis. The paper has used data drawn
from nationally representative large-scale health survey undertaken by the National Sample
Survey Organisation (NSSO) during July 1995 – June 1996. This is the latest data on health
issues published by NSSO.
The health equity aspect has been looked into with respect to health indicators, which
include both preventive and curative care. The major groups considered are rural-urban and
consumption quartiles.
As far as the source of drinking water is concerned, tap water, which is considered as the
safest source of drinking water, is not the main source for the households in Kerala and
54
Madhya Pradesh except for urban areas of Madhya Pradesh. Pucca wells10 or tube wells/hand
pumps are mostly used in both the states.
In rural and urban areas of both the states, the percentage of households without latrine is
quite substantial. It decreases as we move up the quartile and this decrease is more prominent
in urban Madhya Pradesh from 58 per cent in quartile 1 to 10 per cent in quartile 4. The
usage of septic tanks increases with the increase in consumption quartiles in both the states.
In case of immunisation, the incidence of BCG, DPT and OPV among the children in the
age group 0 – 4 years is very high at around 90% except in the case of BCG in rural Madhya
Pradesh where only 64 per cent of the children are immunised as compared to 86 per cent in
urban areas. The percentage of children vaccinated against measles and registered for
paediatric care is quite low in both the states.
The proportion of mothers receiving medical attention at the time of child birth is quite high
at around 97 per cent in Kerala but in the rural areas of Madhya Pradesh the proportion is as
low as 58 per cent. The proportion of mothers registered for postnatal care is low in Kerala at
around 58 per cent in both rural and areas. In case of Madhya Pradesh this proportion is as
low as 30 per cent in rural areas and 47 per cent in urban areas.
In case of curative care, the proportion of cases treated out of those reported ailing have been
found to be quite high for both Kerala and Madhya Pradesh.
The results of the inequality analysis reveal that major portion of health inequality is
accounted for by the inequality within groups rather than between groups. The high
contribution of within group inequality to total inequality with respect to all the relevant
health indicators indicates a high level of heterogeneity within the groups than across groups.
The Gini coefficients for the select health indicators in the study bring out that inequality in
health is more pronounced in the rural areas as compared to urban areas for both the states.
The inequality coefficients are generally the highest for rural Madhya Pradesh for all the
health indicators showing maximum inequality in this region.
Regarding the health care use, it is interesting to note that in Kerala (both rural and urban
areas) private service providers are used by majority of the people for inpatient as well as
10
Cement or concrete lined wells
55
outpatient care. A similar trend is discernible with respect to outpatient care in rural as well as
urban Madhya Pradesh. In case of inpatient care, majority of the people of Madhya Pradesh
still accesses the public health service provider.
Accessibility and quality of treatment are the two very important issues considered in the
paper for comparing the private and public health service providers. For people, who prefer
treatment from non-government (private) sources to government sources, access is a reason
for such a preference. 43.7 per cent of the cases in rural areas and 33.2 per cent in the urban
areas of Kerala feel that either the government doctor/facility is located far off or the private
doctor is easily available as compared to the government doctor. The situation is more severe
in case of rural Madhya Pradesh where 63 per cent of the cases feel that accessibility is the
major reason governing their choice for a private source apart from the level of dissatisfaction
with the treatment in a government facility. With regard to the quality of treatment, more
than 30 per cent of the cases in both rural and urban Kerala have reported to be dissatisfied
with the treatment of the public service provider. Similar trend is observed in case of Madhya
Pradesh as well.
The analysis of medical expenditure per spell of ailment reveals that in case of inpatient care
it is almost half in case of public service providers (as compared to private ones) in both the
states. However, in case of outpatient care, the medical expenditure is nearly similar for both
public and private service providers except in case of urban Madhya Pradesh where it is nearly
double in public service provider as compared to its private counterpart. The interesting point
to note here is that the medical expenditure in the private sector in Kerala (which is a better
managed state as compared to Madhya Pradesh with respect to government health facilities)
is substantially lower than the private sector expenditure in Madhya Pradesh. This trend is
also true in case of all high incidence diseases.
Transport cost incurred for accessing public inpatient care is lower compared to the private
service provider except for rural Kerala. On the other hand, with respect to outpatient care,
patients incur substantially higher transport cost in accessing the public service providers in
both the states baring urban Kerala. This, in a way, reflects the proximity problems of public
service providers for outpatient care.
56
The econometric analysis with respect to choice of health care provider suggests that caste
and income of the patients are its important determinants. It has been found that in both
Kerala and Madhya Pradesh, lower caste and poor people have higher chances of getting
treated in public sector rather than in private sector for both outpatient and inpatient care. It
implies that in both the states, irrespective of their high or low health status, lower caste and
poor people get discriminated in the private sector. Another interesting finding is that in
Madhya Pradesh, public services are insufficient or qualitatively lower in rural areas compared
to urban areas for both outpatient and inpatient care. However, this is not the case in Kerala.
To conclude, the study shows that in spite of several health programmes and regulations, the
government has not been able to spread the required health services universally throughout
the country. The inequality of access to health facility is larger in the state where health status
is low. The public health care system should play a more active role especially in the inpatient
health care sector. The accessibility and quality of health care services in public sector has to
improve, particularly in rural areas so that it can put a ceiling on the soaring prices in the
private sector as has happened in case of Kerala. This would ultimately help the people who
belong to the lower ends of the socio-economic hierarchy and can be a major anchor for
equity in the health service system.
57
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60
APPENDIX 1 : Tables
Table A1: Health Indicators and Composite Index of Health Status of Major States in
India
Infant
Life Life
Maternal Mortality
expectancy expectancy Health
Mortality Rate Rate (per
at birth at birth Status
per 100000 1000 live
(2001- (2001- Index
births (1998) births)
06)_Male 06)_Female
(2002)
Andhra Pradesh 159 62.79 65 62 -0.074
Assam 409 58.96 60.87 70 -1.022
Bihar 452 65.66 64.79 61 -0.145
Gujarat 28 63.12 64.1 60 0.060
Haryana 103 64.64 69.3 62 0.407
Karnataka 195 62.43 66.44 55 0.060
Kerala 198 71.67 75 10 2.028
Madhya Pradesh 498 59.19 58.01 85 -1.508
Maharastra 135 66.75 69.76 45 0.831
Orissa 367 60.05 59.71 87 -1.227
Punjab 199 69.78 72 51 1.058
Rajasthan 670 62.17 62.8 78 -1.034
Tamil Nadu 79 67 69.75 44 0.923
Uttar Pradesh 707 63.54 64.09 80 -0.911
West Bengal 266 66.08 69.34 49 0.555
India 407 63.87 66.91 63
Source: Economic Survey, 2004-05, Ministry of Finance, Government of India
61
Table A2: Inequality in the Proportion of Children Administered with Measles Vaccine
to Total Children (in the age group 0-4 Years) in a Household
Kerala
Group: Rural / Urban GE(0) GE(1) GE(2) Gini
Overall Inequality 4.97064 0.53753 0.37336 0.45413
Within Group 4.96537 0.53222 0.36802
Contribution (%) 99.89 99.01 98.57
Between Group 0.00527 0.00530 0.00535
Contribution (%) 0.11 0.99 1.43
Rural Kerala
Group: MPCE Quartiles GE(0) GE(1) GE(2) Gini
Within Group 5.59035 0.62840 0.45706
Contribution (%) 99.99 99.90 99.86
Between Group 0.00064 0.00064 0.00063
Contribution (%) 0.01 0.10 0.14
Urban Kerala
Within Group 4.12608 0.42302 0.27738
Contribution (%) 99.90 99.04 96.48
Between Group 0.00406 0.00408 0.00411
Contribution (%) 0.10 0.96 1.43
Madhya Pradesh
Within Group 5.42514 0.59008 0.41959
Contribution (%) 99.73 97.51 96.43
Between Group 0.01465 0.01505 0.01555
Contribution (%) 0.27 2.49 3.57
62
Rural Madhya Pradesh
Within Group 6.24108 0.72588 0.55711
Contribution (%) 99.80 98.39 97.97
Between Group 0.01225 0.01187 0.01156
Contribution (%) 0.20 1.61 2.03
Urban Madhya Pradesh
Within Group 3.84310 0.38824 0.25086
Contribution (%) 99.88 98.85 98.25
Between Group 0.00458 0.00452 0.00447
Contribution (%) 0.12 1.15 1.75
63
Table A3: Inequality in the Proportion of Children Registered for Paediatric Care to Total
Children (in the age group 0-4 Years) in a Household
Kerala
Within Group 4.90270 0.50261 0.32997
Contribution (%) 99.98 99.82 99.72
Between Group 0.00093 0.00093 0.00094
Contribution (%) 0.02 0.18 0.28
Rural Kerala
Within Group 5.19042 0.54197 0.36309
Contribution (%) 99.99 99.91 99.87
Between Group 0.00050 0.00050 0.00049
Contribution (%) 0.01 0.09 0.13
Urban Kerala
Within Group 4.51133 0.44722 0.28426
Contribution (%) 99.85 98.54 97.70
Between Group 0.00657 0.00662 0.00669
Contribution (%) 0.15 1.46 2.30
Madhya Pradesh
Within Group 5.36747 0.56840 0.38886
Contribution (%) 99.87 98.73 98.11
Between Group 0.00717 0.00733 0.00750
Contribution (%) 0.13 1.27 1.89
64
Within Group 5.93671 0.66211 0.47825
Contribution (%) 99.96 99.63 99.48
Between Group 0.00244 0.00247 0.00251
Contribution (%) 0.04 0.37 0.52
Within Group 4.27762 0.42467 0.26916
Contribution (%) 99.98 99.78 99.65
Between Group 0.00094 0.00094 0.00094
Contribution (%) 0.02 0.22 0.35
65
Table A4: Inequality in the Proportion of Mothers Receiving Medical Attention at
Childbirth to Total Mothers of Children Born during the last 365 Days (Preceding the date
of Survey) in a Household
Kerala
Within Group 0.39584 0.03139 0.01593
Contribution (%) 99.99 99.90 99.81
Between Group 0.00003 0.00003 0.00003
Contribution (%) 0.01 0.10 0.19
Rural Kerala
Within Group 0.47224 0.03756 0.01911
Contribution (%) 99.99 99.89 99.74
Between Group 0.00005 0.00005 0.00005
Contribution (%) 0.01 0.13 0.26
Urban Kerala
Within Group 0.28733 0.02265 0.01143
Contribution (%) 99.99 99.89 99.74
Between Group 0.00005 0.00005 0.00005
Contribution (%) 0.01 0.13 0.26
Madhya Pradesh
Within Group 4.35760 0.41688 0.25651
Contribution (%) 99.74 97.30 95.55
Between Group 0.01130 0.01159 0.01194
Contribution (%) 0.26 2.70 4.45
66
Within Group 5.22439 0.54282 0.36204
Contribution (%) 99.99 99.87 99.80
Between Group 0.00070 0.00071 0.00071
Contribution (%) 0.01 0.13 0.20
Within Group 2.66900 0.23269 0.12948
Contribution (%) 99.84 98.19 96.68
Between Group 0.00417 0.0043 0.00444
Contribution (%) 0.16 1.81 3.32
67
Table A5: Inequality in Proportion of Mothers Registered for Post-natal Care to Total
Mothers of Children Born during the last 365 Days (Preceding the date of Survey) in a
Household
Kerala
Within Group 5.21434 0.54029 0.35914
Contribution (%) 100.00 100.00 99.99
Between Group 0.00002 0.00002 0.00002
Contribution (%) 0.00 0.00 0.01
Rural Kerala
Within Group 5.23202 0.54059 0.35927
Contribution (%) 99.93 99.36 99.04
Between Group 0.0345 0.00347 0.00349
Contribution (%) 0.66 0.64 0.96
Urban Kerala
Within Group 5.17867 0.52915 0.34802
Contribution (%) 99.89 98.90 98.28
Between Group 0.00569 0.00587 0.00608
Contribution (%) 0.11 1.10 1.72
Madhya Pradesh
Within Group 7.78001 1.00163 0.87463
Contribution (%) 99.70 97.66 97.22
Between Group 0.02322 0.02398 0.02497
Contribution (%) 0.30 2.34 2.78
68
Within Group 8.39000 1.19251 1.15760
Contribution (%) 99.98 99.88 99.87
Between Group 0.00138 0.00142 0.00145
Contribution (%) 0.02 0.12 0.13
Within Group 6.58540 0.75506 0.56597
Contribution (%) 99.89 99.02 98.68
Between Group 0.00749 0.00751 0.00756
Contribution (%) 0.11 0.98 1.32
69
Table A6: Average Expenses Incurred (Including Cases of Zero Expenses) for Treatment of
Members Treated as Inpatient in Hospital during the last 365 Days (Rs. Per Spell of
Ailment)
Rural Urban
Total
Medical
Total Medical Transport
Nature Expenditure
Expenditure for (Other Transport
State of Source for
Treatment During than (Other than
Ailment Treatment
the Stay at Ambulance Ambulance)
During the
Hospital )
Stay at
Hospital
101 Private 487.12 47.18 764.82 35.18
101 Public 213.13 55.19 257.73 36.36
106 Private 616.00 46.41 666.80 29.60
106 Public 320.39 55.73 187.31 30.03
114 Private 1365.75 51.73 898.47 48.85
114 Public 538.35 59.35 761.50 43.69
Kerala
115 Private 1513.53 82.06 1179.65 63.15
115 Public 1197.50 124.70 954.17 50.33
224 Private 17740.93 358.93 4448.33 150.21
224 Public 7998.26 181.09 1415.00 71.11
ALL Private 3029.51 122.66 2453.15 94.94
ALL Public 1549.85 146.49 1598.71 92.45
101 Private 1156.25 57.63 1181.11 35.00
101 Public 734.55 309.74 427.63 21.65
106 Private 1547.35 66.87 1079.17 55.42
106 Public 1136.86 99.72 593.44 128.14
114 Private 2327.14 112.86 1010.00 40.00
Madhya 114 Public 1808.33 98.00 462.50 18.33
Pradesh 115 Private 1765.33 72.20 2188.50 40.75
115 Public 1071.15 92.65 1262.80 66.00
224 Private 4778.89 158.44 9450.00 203.08
224 Public 4218.18 469.82 3535.88 376.77
ALL Private 4009.77 212.89 4859.14 262.80
ALL Public 1904.36 191.73 2289.18 149.86
Notes:
101= Diarrhoea & Gastro-enteritis Dysentery (Including Cholera); 106= Fevers of Short
Duration; 114= Cough and Acute Bronchitis; 115= Acute Respiratory Infection, 224=
Disease of Heart
70
Table A7: Average Expenses Incurred (Excluding Cases of Zero Expenses) for
Treatment of Members Treated as Inpatient in Hospital during the last 365 Days
Rural Urban
Total Medical Total Medical
Expenditure for Expenditure
Nature of Transport Transport
State Source Treatment for Treatment
Ailment (Other than (Other than
During the During the
Ambulance) Ambulance)
Stay at Stay at
Hospital Hospital
101 Private 502.34 48.66 764.82 46.00
101 Public 262.31 67.92 405.00 44.44
106 Private 616.00 49.50 666.80 36.67
106 Public 364.59 61.30 234.14 32.84
114 Private 1365.75 59.11 898.47 53.58
114 Public 583.21 59.35 812.27 53.77
115 Private 1513.53 87.19 1179.65 70.17
Kerala
115 Public 1496.88 138.56 954.17 54.91
117 Private 2996.86 138.24 3371.43 122.08
117 Public 1201.58 112.55 1337.50 61.88
224 Private 17740.93 372.22 4641.74 163.86
224 Public 7998.26 189.32 1415.00 80.00
ALL Private 3053.74 129.22 2475.30 105.83
ALL Public 1659.30 155.09 1741.11 104.49
101 Private 1156.25 76.83 1181.11 90.00
101 Public 734.55 474.28 451.39 37.39
106 Private 1547.35 80.95 1079.17 102.31
106 Public 1136.86 104.59 607.57 367.33
114 Private 2327.14 112.86 1010.00 66.67
Madhya 114 Public 1808.33 147.00 462.50 27.50
Pradesh 115 Private 1765.33 83.31 2188.50 74.09
115 Public 1127.53 97.53 1262.80 120.00
224 Private 4778.89 158.44 9450.00 293.33
224 Public 4218.18 516.80 3535.88 533.75
ALL Private 4026.83 249.96 4877.76 397.99
ALL Public 1983.52 234.34 2367.73 259.19
nd
Source: Computed from NSSO, 52 round (July 1995 - June 1996)
Disease of Heart
71
Table A8: Average Expenses (Including Zero Expenses) Incurred during the last 15 Days for
Treatment of Members as Outpatient (Rs. Per Spell of Ailment)
Rural Urban
Total Medical Transport Total Medical
Nature of Transport
State Source Expenditure for and Expenditure for
Ailment and Lodging
Treatment by Lodging Treatment by
Charges
Household Charges Household
101 Private 109.91 16.67 124.58 20.33
101 Public 54.83 7.17 40.00 2.50
106 Private 63.90 6.99 85.37 8.30
106 Public 57.78 8.67 51.56 6.02
114 Private 115.24 8.62 94.22 6.70
114 Public 91.48 11.67 46.00 7.50
115 Private 93.55 17.00 258.75 34.83
Kerala
115 Public 104.57 15.14 n.a n.a
117 Private n.a n.a n.a n.a
117 Public 80.00 50.00 n.a n.a
224 Private 167.07 8.89 170.00 10.77
224 Public 94.94 6.06 90.63 5.00
ALL Private 128.19 20.76 140.93 22.55
ALL Public 130.29 34.30 114.00 15.53
101 Private 141.10 16.13 210.81 5.63
101 Public 391.67 101.33 806.18 8.35
106 Private 104.24 5.58 151.04 2.72
106 Public 99.65 3.08 135.80 1.11
114 Private 230.91 9.17 116.46 14.58
Madhya 114 Public 122.00 10.00 100.00 0.00
Pradesh 115 Private 486.94 26.00 380.47 20.53
115 Public 505.00 22.50 308.33 0.00
224 Private 800.00 132.50 1323.31 159.23
224 Public n.a n.a 316.67 16.67
ALL Private 205.03 13.58 284.75 77.36
ALL Public 200.62 20.45 548.54 87.90
101= Diarrhoea & Gastro-enteritis Dysantry (Including Cholera); 106= Fevers of Short
Disease of Heart
72
Table A9: Average Expenses (Excluding Zero Expenses) Incurred during the last 15 Days
for Treatment of Members as Outpatient (Rs. Per Spell of Ailment)
Rural Urban
Total Medical Total Medical
Nature of Transport Transport and
State Source Expenditure Expenditure
Ailment and Lodging Lodging
for Treatment for Treatment
Charges Charges
by Household by Household
101 Private 109.91 25.00 124.58 34.86
101 Public 82.25 10.75 40.00 10.00
106 Private 64.49 11.51 86.23 14.64
106 Public 68.21 12.93 57.04 9.21
114 Private 115.24 14.86 94.22 16.53
114 Public 96.05 22.27 55.20 11.25
Kerala
115 Private 93.55 23.38 258.75 52.25
115 Public 104.57 35.33 n.a n.a
224 Private 167.07 24.00 170.00 28.00
224 Public 94.94 15.57 90.63 8.00
ALL Private 128.62 20.76 140.93 22.55
ALL Public 133.35 34.30 114.00 15.53
101 Private 141.10 44.00 210.81 30.00
101 Public 391.67 152.00 913.67 23.67
106 Private 105.69 26.39 151.04 22.50
106 Public 105.80 14.72 138.89 16.67
114 Private 230.91 35.17 116.46 350.00
Madhya 114 Public 122.00 50.00 200.00 n.a
Pradesh 115 Private 515.59 66.86 380.47 97.50
115 Public 505.00 45.00 308.33 n.a
224 Private 800.00 132.50 1323.31 690.00
224 Public n.a N/A 316.67 50.00
ALL Private 207.67 46.50 285.31 77.36
ALL Public 207.87 62.82 561.01 87.90
nd
Source: Computed from NSSO, 52 round (July 1995 - June 1996)
Disease of Heart
73
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Equity Themes in India's Health Sector Reforms

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Equity Themes in India’s Health Sector Reforms

Working Paper · August 2006

Sanjib Pohit Indranil De

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List of Appendix Tables 3

2. Programmes & Regulation in the Health Care sector in India 11

4. Private and Public Health Service Providers: A comparison 42

5. Choice of Health Care Provider 48

6.Summary and Conclusions 52

API Annual Parasite Incidence

Table A1: Health Indicators and Composite Index of Health 61

Table A2: Inequality in the Proportion of Children 62

Table A3: Inequality in the Proportion of Children Registered 64

Table A7: Average Expenses Incurred (Excluding Cases of 71

The prevalence of inefficiencies in public health system in the form of mis-targeting,

Box 1: Inefficiencies of Enforcement Mechanism

Table 1: Socio-Economic Profile of Kerala and Madhya Pradesh

Area (in sq. kms) 2001 38863 308245

2. Programmes and Regulation in the Health Care Sector in India

2.1 Major Health Programmes and Regulations of Union Government

Table 3: Major Health Programmes of Government of India

Central Scheme for 1991 Development of Alternative medicine is not

To control Tuberculosis the National Tuberculosis Control Programme was launched in

Despite these initiatives of the government, the programmes of Department of Family

2.2 Policy and Regulation of the State Government

Table 4: Major Health Policy/Activity of Kerala and Madhya Pradesh

Kerala Madhya Pradesh

Opening, improvement and upgradation of Community level groups and institutions

Strengthen Monitoring Cell and Organisational and Managerial reform to

Construction of Health Transport Implementation of Essential Drug Concept

Strengthen and opening of primary health

Strengthen of medical education in the

2.3 Decentralisation in Health care

Decentralisation refers to a situation when responsibilities of upper level of government are

3.1 Conceptual Framework

Another important dimension of health inequality measurement is the rural-urban affiliation

3.2 Approach and Measurement Issues

Table: 5 Quartiles of Monthly Per Capita Consumption Expenditure (in Rs.)

Table 9: Inequality in the Proportion of Children Administered with Measles Vaccine to

Table 12: Inequality in the Proportion of Mothers Receiving Medical Attention at

Illness Cases Treated out of the Total Reported Cases

Kerala Madhya Paradesh

4. Private and Public Health Service Providers: A Comparison

4.1 Health Care Use: Public Private Mix

4.2 Accessibility and Quality of Treatment

Private 3029.51 122.66 2453.15 94.94 1.23 1.29

Private 128.19 20.76 140.93 22.55 0.91 0.92

5. Choice of Health Care Provider

5.1 Conceptual Framework

Madhya Pradesh Inpatient

In case of inpatient care in Madhaya Pradesh, the maximum likelihood estimates of

Kerala Madhya Pradesh

age (in years) 0.00067* 0.00074 0.00025 0.00122**

6. Summary and Conclusions

The prevalence of inefficiencies in public health system in the form of mis-targeting,

Baru, V, Rama and G Sadhana (2000), “ Resurgence of Communicable Disease: Gastro-

Cowell, F. A. (1995), Measuring Inequality, Harvester Wheatsheaf, Hemel Hempstead.