HEALTHCARE SYSTEM IN INDIA AND WORLD:

(Who ever is making this add his part also in this)

CURRENT HEALTHCARE SYSTEM IN INDIA

The demand for healthcare such as hospitals, equipment, doctors,

nurses etc.. in india is very high, whereas the supply is very low. This
high demand and low supply will eventually lead to high prices for the
healthcare system, which is not affordable to high percent of people in
india.

One way of increasing the affordability of healthcare (partially) will be

possible by reducing the prices of the healthcare products. To decrease
the price, we can reduce the demand or we can increase the supply.
Either way the prices will decrease. Reducing the demand for healthcare
is highly impossible as no matter how many environmental hygiene
schemes we introduce, the health problems are still highly uncertain and
hence reducing the demand may not be a viable solution. So we now
need to increase the supply of healthcare either by reducing the tax
rates or increase in the government spending on the healthcare
infrastructure.

Another way of increasing the affordability of healthcare (Partially) will be

by increasing the well being of the people. This will happen when the
economy is in boom, which results in inflation that implies an increase in
the price.

Therefore increasing the supply of healthcare will be the most feasible

option to decrease the price and also infrastructure will increase.

EFFECTS ON ECONOMY DUE TO LACK OF HEALTHCARE

AFFORDABILITY:

1. Due to lack of affordability in healthcare, all the healthcare

expenses were completely going out of the people’s own pocket,
which resulted in exhaustion of peoples properties, savings and
finally left with debt. Due to this many households are falling to
below poverty level.

         As we have seen demand is continuously rising with no significant

movement in supply, if the government is not going to take any action,
demand will be on a rise and results in further price increase which
further makes many households fall into poverty.
         As poverty increases, the government is obliged to spend more on
some incentives that were given to the poor, which can be normally used
in other projects. Due to the increase in poverty. Spending on other
sectors will decrease, which affects the overall GDP negatively.

2. Reduction in productivity: If the healthcare is not affordable, then

many individuals will not be having access to healthcare, and
hence they cannot be able to get proper treatment which results in
productivity reduction which further implies decrease in GDP.

STEPS TAKEN BY THE GOVERNMENT:

1. AYUSHMAN BHARATH: Ayushman bharath scheme is a kind of

insurance scheme without any premium to be paid, applicable for
poor people in the hospitals enrolled in this program. These
payments were considered as transfer payments. When transfer
payments increase, consumption will also increase, which results
in a rise in demand. This rise in demand will increase the prices in
the short-run.
2. ALLOCATING MORE BUDGET: Government budget when
allocated more, will be spending more. When the government
increases spending on healthcare infrastructure, production costs
will decrease and employment opportunities will increase, which
results in an increase in the supply of healthcare.

HOW GOVERNMENT GOING TO GET MORE FUNDS:

1. Borrowing
2. Increasing Taxes.

When Taxes are increased, it will result in an added burden

on the people immediately and moreover when taxes are
increased, people will tend to save a lot and hence
circulation will get decreased which may not be a good sign
for the economy, but on the other hand borrowing will have
an effect on people in long run, by that time with the amount
borrowed and invested, our GDP will increase and hence
paying interest in long run may not be a problem at that
stage.

          CAN GOVERNMENT BORROW ANY AMOUNT OF MONEY?

           Government borrowing will be helpful in increasing the GDP.

Though we need to pay back the money with interest. It would be worth
it as it would help GDP increase.This doesn’t mean that the government
can borrow huge amounts of money and invest expecting high returns.
There will be a certain limit to borrowing, which when exceeded will have
a negative effect on the economy, like when excess money is borrowed
tax rates will be increased and this results in decrease in investments
and circulation of money in the economy which may result in a recession
phase.

1. FDI IN INSURANCE SECTOR INCREASED: With the rise in

FDI percentage in the insurance sector, many insurance
companies will show interest in investing and hence it results
in rise in insurance companies which implies a rise in GDP.