Chapter-I

HEALTH CARE MANAGEMENT IN INDIA

“Happiness, happiness, happiness,

It may be of different origin on this earth
But the happiness of being healthy,
Is the real happiness”
-Dashdorjin Natragdorj

Good health is a pre-requisite for human productivity and developmental process.

It is essential for economic and technological development. Health is a common theme in
most cultures. In fact, the concept of health is found as a part of cultures of all
communities. Among definitions still used, probably the oldest is that ‘health is the
absence of disease’. In some cultures, health and harmony are considered equivalent,
harmony being defined as being at peace with the self, the community, God and cosmos’.
Charaka, the renowned Ayurvedic physician said: Health was vital for ethical, artistic,
material and spiritual development of man. Buddha has also said “Of all the gains, the
gains of health are the highest and the best”.

The ancient Indians and Greeks shared this concept and attributed disease to
disturbances in bodily equilibrium of what they called ‘humours’. Modem medicine is
often accused for its preoccupations with the study of disease and neglect of the study of
health. Consequently, our ignorance about health continues to be profound, for e.g., the
determinants of health are not yet clear; the current definitions of health are elusive; and
there is no single yardstick for measuring health. There is thus, a great scope for the study
of the “epidemiology” of health.

Health is man’s most precious possession, it influences all his activities; it shapes
the destinies of people. Without it, there can be no solid foundation for man’s happiness.
Nevertheless, all too often, social planners forget this simple truth and leave health out of

1
account. Integration of health schemes in overall development plans are of paramount
importance”.1

Definitions of Health
Many definitions have been evolved over the time due to changing conditions in
the universe. Historically, the term is derived from an English word ‘health’ meaning the
condition of being ‘safe and sound’ or ‘whole’. Many definitions of health have been
offered from time to time.

In Webster’s dictionary, health is defined as “The condition of being sound in body, mind
or spirit, especially freedom from physical disease or pain”.

In Oxford English Dictionary, it is defined as “Soundness of body and mind: the

condition in which its functions are duly and efficiently discharged “

Duros R. defines, “Health implies the relative absence of pain and discomfort and a
continuous adoption to environment “2

Health is defined as “a state of complete physical, mental and social well being and
not merely absence of disease or infirmity World Health Organisation (1948)3. In the
International Conference at Alma-Ata in 1977, a clause “and ability to lead a socially and
economically productive life” was added. The 37th World Health Assembly adopted the
resolution No.WHA/27/1984/RE/1.60 and incorporated ‘spiritual dimension’ in the
definition adopted at Alma-Ata.

The health status and disease status are a result of the process of a continuous
adjustment between the internal and external environment. Internal environment within the
human being pertaining to every tissue and organ system. Man is also exposed to external
environment. Thus, man’s the external environment air, water and food, and his personal
environment relating to his work, eating, drinking, smoking etc., i.e., his way of life, all

1
Tjeirry, E.J.. “Laying Foundation” in the ‘World Health Article., March, 1969, p.13.
2
Duros, R. (1965). “Man Adapting New Heaven”, Yale University Press.
3
W.H.O. (1978). Health for All, Sr.No.1.

2
have a bearing on his health. Health habits, personal hygiene, health knowledge and mental
attitude to life also influence health.
Dimensions of Health
According to WHO, health has three specific dimensions--the physical, the mental
and the social. Many more may be cited i.e., spiritual, emotional, vocational and political
dimensions. As the knowledge base grows, the list may be expanding:

Fig. 1.1 Dimensions of Health

1. Physical Dimension: “Physical dimension of health is related to body structure and
the physiology. It refers to normal functioning of all the tissues, organs and
systems of the body resulting in harmonious functioning of the body”. The signs of
good health are good complexion, a clean skin, bright eyes, lustrous hair, well built,
with firm flesh, a sweet breath, a good appetite, sound sleep, regular activity of
bowel and bladder and co-ordinate bodily movements.

2. Mental Dimensions: Mental health is related to mind and refers to normal

functioning of mind not merely absence of mental illness. It is rather abstract. It is
a state of balance between the individual and his self on one side and between the
individual and his external environment on the other.

3. Social Dimension: “Social well-being of a person implies harmony and integration

within the individual, between each individual and other member of the society and

3
 between the individuals and the world in which they live”.4 ‘Social health’ can be
defined as “Quantity and Quality of an individual’s interpersonal ties and the extent
of involvement with the community”.5

4. Spiritual Dimension: It takes into account individual as a whole, comprising of

body, mind and soul. As man has body and special senses, the mind has ‘spirit of
life’. Indian culture names it as ‘atma’ which is intangible. It transcends
physiology and psychology. Spiritual Dimension of health includes integrity,
principles, ethics, the purpose in life, commitment to some higher being and belief
in concepts that are not subject to “state of art explanation”.6

5. Emotional Dimension: Emotions are sudden forces that emerge in mind which
includes thoughts, emotions and will. A healthy mind is one that expresses the right
emotions at right time in a controlled form. In psychiatric illness, emotional
disturbances are expressed in certain forms like anxiety, depression and mood
swings etc. In short, mental dimension deals with ‘cognitive’ (learned) behaviour,
while emotional dimensions deals with ‘feelings’

6. Vocational Dimension: This dimension is concerned with occupation and earning

livelihood. If the person and his job are “made for each other”, it can be said that
he is vocationally healthy. To others, it represents the culmination of the efforts of
other dimensions as they function together to produce what the individual considers
the life “success”.

Determinants of Health
Health is multi-factorial. These factors may be internal or external. When these
factors interact the health of the individual or community would be affected. The following
are some of the determinants of health.

4
C.Mich. D.E. (1984). Jr .School Health, 54(1), pp.30-32.
5
Donald C.A. et al.(1978). Social Health in: Conceptualisation and Measurement of ‘health for
adults in the health insurance study, Santa Monica, CA, Rond Corporation, Vol.4.
6
Eherst, R.M. (19840. Jr. School Health, 54(3), pp.99-104.

4
 Fig.1.2. Determinants of Health
Spectrum of Health
“Where does the health ends and disease starts? It is telling like where does a
colour ends and other colour starts in VIBGYOR Spectrum of a prism. At the one end of
this spectrum there is the most desirable state called ‘positive health’ while the other
extreme is the undesirable event of death”.7
The positive health envisages perfect physical social and mental well-being. To
consider a man appearing for a examination under six heads (six dimensions). ‘Positive
health’ would mean the person scoring 100 out of 100 in each of these heads.

Figure 1.3. Spectrum of Health

7
Dr. Kulakanri A.P. (1998). Text Book of Community Medicine, Vora Medical Publications, Mumbai, p.79.

5
 HEALTH CARE IN INDIA

“Life is not mere living but living in health” with this words, the Honorable Mrs.
Indira Gandhi, the then Prime Minister of India, opened her address on 6th May
1981 at the Thirty-fourth World Assembly meeting in Geneva. She further stated
that “the health of the individual, as of nations, is of primary concern to us all.
Health is not the absence of illness but a glowing vitality, a feeling of wholeness
with a capacity for continuous intellectual and spiritual growth”. Life means
Living in Health:

Health has been declared as a fundamental human right. This implies that the state
has responsibility for the health of its people. National Governments all over the world are
striving to expand and improve their health care services. The present concern in both
developed and developing countries is not only to reach the whole population with
adequate health care services, but also to secure an acceptable level of Health for All.

Concept of Health Care

Health care is an expression of concern for fellow human beings. It is defined as
‘multitude of services rendered to individuals, families or communities by the agents of the
health services or professions, for the purpose of promoting good health. Such services
may be staffed, organized, administered and financed in every imaginable way, but they all
have one thing in common: people are being “Served”, i.e., diagnosed, helped, cured,
educated and rehabilitated by health personnel.8

‘Health care’ and ‘medical care’ both seem to be synonymous. In fact, ‘medical
care’ is a subset of health care system. The term ‘medical care’ ranges from domiciliary
care to resident hospital care and it refers chiefly to those personal services that are
provided directly by the physicians or rendered under their instructions.9

8
Dr. K. Park. (2010). “Park’s Text Book of Social and Preventive Medicine, Jabalpur, Banarsidas
Bhanol Publishers, p.25.
9
Ibid., p.70.

6
 The society’s health is influenced by the accessibility, affordability, quality
availability and utilisation of health services. The best health services are those that are
easily accessible, both time-wise and distance-wise to all classes of society those that can
be afforded by the society and government which provides them and affordable by people
who utilise them, of a minimum acceptable standard in keeping with the need of the
users at each level, available to all classes of society who need them and which range in
their coverage from womb-to-tomb with effective deployment of available resources.10

History of Health Care in India

India is one of the oldest surviving civilisations of the world. The birth of
Ayurveda in India dates back to the period of the Indus valley civilisation. India has a rich,
centuries old heritage of health sciences. The philosophy of Ayurveda and the surgical
skills enunciated by Charaka, Jivaka, Vagbhatta, Dhanvantri and Sushrita bear testimony
to the fact that our ancient health system was of a holistic nature, which took into account
all aspects of human health Medicine based on the Indian system was taught in the
universities of Takshashila and Nalanda, which probably contributed to the advances in
Arabic medicine. The Upakalpaniyam Adhyayam of Charaka Suthrasthanam gives
specifications for hospital buildings, labour rooms and children wards. The qualifications
for hospital personnel as well as specifications for hospital equipment, utensils,
instruments and diets have also been given.

During the rule of Emperor Ashoka Maurya (third century BCE), schools of
learning in the healing arts were created. Many valuable herbs and medicinal combinations
were created. Even today many of these continue to be used. During his reign there is
evidence that Emperor Ashoka was the first leader in world history to attempt to give
health care to all of his citizens, thus it was the India of antiquity which was the first state
to give its citizens national health care. During the Muslim period (1000-1500 A.D.) the
Unani system was established. During the regime of Akbar Unani hospitals were
established and Unani schools were opened in Lahore. Delhi, Agra, Lucknow , Hyderabad
and later on in some other parts of the country.

10
B.M. Sakharkar (2009). Principles of Hospital Administration, New Delhi, Jaypee Brothers
Medical Publishers (P) Ltd., p. 3.

7
 At some point in the history of India, the entire social fabric of this nation was
destroyed due to foreign invasions and other factors, healthcare system being no
expectation. In eighteenth century, the East India Company of the British started
development of Western medicine known as allopathic system on systematic and scientific
lines. By the end of this century, there were four medical colleges in India in addition to a
number of medical schools with lower levels of instruction. Thus, from nineteenth century
onwards, unlike indigenous medicine modern western medicine was increasingly applied
for preventing the occurrence of illness.

The vital aspect of health did not receive proper care and attention during the pre-
independence period as the British rulers were concerned more with the expansion,
consolidation and concentration of their rule, rather than to attend to the alarming, awful
and pressing unsanitary, unhygienic conditions rampant in the country as a whole.
Negligence of these areas, absence of medical and health services and large-scale
prevalence of poverty and ignorance, created conditions conducive for breeding and
spreading of all types of diseases among the Indian masses. In the light of these
circumstances, certain measures were taken by the British rulers for the systematisation of
health services in India. Commissioners of public health were appointed in the major
provinces. The Birth and Death Registration Act in 1873, the Vaccination Act in
1880,Epipdemicdoseas Act in 1887 were introduced. The Government of India Act was
introduced for granting larger autonomy to the provinces in 1935. The Drugs Act was
enacted as a Central legislation in 1940. In spite of taking these steps by the British rules,
the health conditions and administration could not be recovered on account of outbreak of
Second World War and subsequent partition of the country. Health Survey and
Development Committee popularly known as Bhore Committee was appointed in 1943 to
survey the then existing health conditions and health organisation in the country and to
make recommendations for further development. The committee submitted its report in
1947 which. had a powerful impact on evolution of health policy in independent India.
This report still continue to be an important document in the field of health administration
in the country

8
 DIFFERENT SYSTEMS OF MEDICINE IN INDIA

India has incomparably rich heritage in ancient systems of medicine that make up a
veritable treasure house of knowledge for both preventive and curative health care. These
systems, through their safe, effective and inexpensive treatments, have the potential to
make a significant contribution to the health care of the common people. But their true
potential is still largely unrealised, despite a large and well-dispersed infrastructure. There
are, presently, more than 10 systems of medicine which are very briefly described as
under:
Allopathy: Allopathy is the conventional form of medicine using pharmaceuticals and
invasive techniques for diagnosis and treatment. Allopathy has evolved over the years
with various discoveries and inventions made in the field of science. A patient is
physically examined, then diagnostic tests are conducted and after conformation of disease,
the therapy is instituted. There are several disciplines in Allopathy viz., General Medicine,
General Surgery, Obstetrics & Gynaecology, Pediatrics, Orthopaedics, Neurology and
Cardiology etc.

Ayurveda: Ayurveda means the “science of life” in Sanskrit. It is the oldest and the best
documented among the ancient systems of medicine. The documentation of Ayurveda is
referred to in the Vedas (1500 BC-500 BC), as the oldest recorded wisdom in the world. It
derives its basic principles from the Charaka Samhita (600 BC) and the Susruta Samhita
(500 B.C.). The system is based on the laws of nature and the individual human being is
regarded as a miniature replica of the universe. The five physical attributes of
Pancamahabhuta (Space, Air, Fire, Water and Earth mass) constitute three major biological
components of the living body called tridosha, i.e., vata, pitta and kapha. All ailments arise
out of the imbalance of the three doshas or humours and the role of medicine is to assist
the natural healing powers of the body. It is a complete and well-developed primitive,
preventive and curative system of medicine with eight major clinical specialities.

Pahchakarma: This is a combination of five processes to cleanse the body, mind and
emotions (i) therapeuting vomiting (ii) purgation (iii) enema therapy (iv) nasal
administration, and (v) blood-letting.

9
Homoeopathy: The father of homeopathy is the German physician and chemist Samuel
Hahnemann. The term homeopathy comes from the Greek word ‘homios’ meaning like
and ‘pathos’ meaning suffering. The system works by treating the person as a
whole/holistically. So the system, while looking at the symptoms, will take into account
the individual’s mental, physical, emotional and spiritual, health before deciding the
treatment. Homeopathy is based on the principles that ‘like cures like, meaning there by
‘treatment given is similar in substance to the illness’. Homeopathic remedies are aimed at
stimulating and supporting the body’s healing mechanism.

Naturopathy: Naturopathy relies solely on the dietary practices. The basic tenet of it is to
live according to the laws of nature: disease occurs due to the accumulation of toxins in the
body and to cure the ailment, the body is purified with the use of natural method, dietary
regulation and exercise. A Naturopath uses mud, heat and air as the instruments for
therapy, but never any drugs.

Unani: The system is originated in the fourth and fifth century BC in Greece under the
patronage of Hippocrates and Galen. It is based on the humoural theory that good health
depends on the balance of the four humours - blood, phlegm, yellow bile, and black bile.
Regimental therapy, diet therapy, pharmacotherapy and surgery are some of the modalities
of this system.

Physiotherapy: Physiotherapy is a health care profession, which involves assessment,

treatment, and preventions, both in health and in disease, right from a neonate to an aged
individual.

Acupuncture: Acupuncture is an ancient Chinese method of treating ailments. The word

acupuncture is made of two parts, ‘acus’ which means a needle and ‘puncture’. This
method provides relief from illness by needle puncture of specific points on the body

Sidha: Sidha means a ‘Naster’; thus the name denoted the mastery of such practices. The
most famous of the Siddhas was Nagarjuna, whose rasatantra forms the basis of this
system. It flourished in south India especially in Tamilnadu and Srilanka as its literature is

10
found in Tamil. The distinctive features of Siddha are its reliance on minerals and
meteoric compounds and its emphasis on rejuvenation therapies.

Yoga: The technology of the practice of yoga is based on Patanjali’s Yogasutra.

Meditation is an essential ingredient of yoga. It is associated with postures (asana),
breathing exercises which have wide and varied beneficial influences on both physical and
mental health.

There has been a constant policy support to traditional medicine in India.

However, in order to augment the development of traditional systems of medicine in a
systematic manner, the Government of India put in place a separate National Policy on
Indian Systems of Medicine & Homeopathy in the year 2002. The strategies outlined in
this policy are in line to that encompassed in the WHO strategy for Traditional Medicine.
Under the Ministry of Health & Family Welfare, there is a separate Department of Indian
Systems of Medicine & Homeopathy since 1995, which has now been renamed as the
Department of Ayurveda, Yoga, Unani, Siddha and Homoeopathy (AYUSH).

Health Committees and Commissions

Over the past decades, several Committees and Commissions have been
appointed by the Government to examine issues and challenges being faced in the health
sector. The purpose of these committees which formed from time to time is to review the
current situation regarding health status in the country and suggest further course of action
in order to accord the best of healthcare to people.

The earliest committees include the Health Survey and Development Committee,
Bhore Committee (1943) and Sokhey Committee. Other committees in the Post
Independence period include Mudaliar Committee (1961), Chaddah Committee (1963),
Mukherjee Committee (1965), Jungalwala Committee (1967), Karthar Singh Committee
(1973), Srivastava Committee (1975) and Bajaj Committee (1986). Some of the recent
committees include Mashelkar Committee and the National Commission on
Macroeconomics and Health. These committees and commissions have been headed by
eminent public health experts, who have studied the issues in an indepth manner and
provided overarching recommendations for various aspects of the health care system in

11
India. The areas covered by them related to organisation, integration/development of health
care services/delivery system across levels; health policy and planning; national
programmes; public health; human resource; indigenous system of medicine; drugs and
pharmaceuticals amongst others. An examination of these reports reveals the options,
lessons and challenges for strengthening India’s health system.

Healthcare During Five Year Plans

The health of the nation is an essential component of development, vital to the
nation’s economic growth and internal stability. Assuring a minimum level of health care
to the population is a critical constituent of the development process. Recognising this
fact, the Planning Commission gave considerable importance to health programmes in Five
Year Plans. For purposes of planning, the health sector has been divided into the following
sub-sectors.11
(1) Water supply and sanitation (2) Control of communicable diseases (3) Medical
education, training and research (4) Medical care including hospitals, dispensaries and
primary health centres (5) Public health services (6) Family planning, and (7) Indigenous
systems of medicine.
The First Five Year Plan (1951-56) was a modest beginning towards development
of different health programmes. A seven-point public health programme such as provision
of water supply and sanitation, control of malaria, health services for mothers and children,
education and training in healthcare etc. formed the basis for the plan.
In the Second Five Year Plan (1956-61) the government aimed to expand the
existing health services to bring them within the reach of the people.
In the Third Five Year Plan (1961-66) importance was given to expand health
services to bring progressive improvement in health by ensuring a minimum of physical
well-being.
In the Fourth Five Year Plan (1969-74) efforts were made to provide effective base
for health services in rural areas for undertaking preventive and curative health services.
In the Fifth Five Year Plan (1947-79) an attempt was made to provide minimum
public health facilities integrated with family planning and nutrition for vulnerable groups.

11
Park, K. (2010). ‘Park’s Text Book of Social and Preventive Medicine, Jabalpur, M/s.Banarsidas
Bhanot Publishers, p-25.

12
 In the Sixth Five Year Plan (1980-90) providing qualitative medical education and
training to the people was emphasised.
In the Seventh Five Year Plan (1985-90) efforts were made to correct imbalances to
improve quality and establishment of Universities of Health Sciences with an objective of
linking training centres. Encouragement was given to states to participate fully in their
own manpower development activities.
During the Eighth Five-Year Plan (1992-97) Plan period efforts were initiated to
expand education facilities for those categories of healthcare providers. The incorporation
of health related courses was pursued vigorously. Interest was shown in bridging the gap
between supply and demand of paramedical staff and nursing staff.
During the Ninth Plan, efforts were made to explore the health status of the
population by optimising coverage and quality of care by: (a) identifying and rectifying the
critical gaps in infrastructure, manpower, equipment, essential diagnostic reagents and
drugs, and (b) enhancing the efficiency of the health system.
The focus during the Tenth Five Year Plan was on restructuring the existing
government heal care system, Development of appropriate two-way referral systems,
Building up an efficient logistics system, Improvement in the quality of care at all levels
and Building up Health Management Information using IT tools.
The Eleventh Five Year Plan (2007-12) will provide an opportunity to restructure
policies to achieve a New Vision for Health based on faster, broad-based and inclusive
growth. This plan gives special attention to the health of marginalised groups like
adolescent girls, women of all ages, children below the age of three, older persons,
disabled and primitive tribal groups. To achieve these objectives, aggregate spending on
health by the Central and States will be increased significantly.
The Eleventh Five Year Plan will aim for inclusive growth by introducing National
Urban Health Mission (NUHM) which, along with National Rural Health Mission
(NRHM), will form SURVA SWASTHYA ABHIYAN. National Urban Health Mission will
meet the health needs of the urban poor, particularly the slum-dwellers, by making
available to them essential primary health services. This will be done by investing in high
caliber health professionals, appropriate technology through Public Private Partnership
(PPP) and health insurance for urban poor, while National Rural Health Mission will

13
address infirmities and problems across primary health care and bring about improvement
in the health system and the health status of those who live in the rural areas.12
The achievements in health infrastructure during the past 60 years of planned
development are given in table 1.
Table I.1
Achievements in health infrastructure
Sl.No. 1st plan 11th plan
1951-56 2007-12
1. Primary Health Centres 725 23,458
2. Su-centres NA 146,036
3. Community Health Centres - 4,276
4. Total beds (2002) 125,000 914,543
5. Medical colleges 42 300
6. Annual Admissions in Medical Colleges 3,500 34,595
7. Dental Colleges 7 290
8. Allopathic Doctors 65,000 757,377
9. Nurses 18,500 1,043,363
10. ANMs 12,780 557,022
11. Health Visitors 578 51,776
12. Health Workers (F) (in position) - 153,568
13. Health Workers (M) (in position) - 60,247
14. Block Extension Educator - 3,133
15. Health Assistant (M) (in position) - 17,976
16. Health Assistant (F)/LHV (in position) - 17,608
17. Village Health Guides (2002) - 323,000

Source: Park’s-2011 edition, p. 816.13

The following table depicts the progressive increase in the outlay of health during
the Five Year Plans.

12
Sharma, D.K. and Goyal, R.C. (2010). PHI Learning Pvt. Ltd., New Delhi, p. 42
13
Dr. K. Park, op.cit., p. 816.

14
 Table 2
Outlay of Health Plans during 1951-2012
(Rupees in Crores)
Period Total Health Family Water
Investment Welfare Supply &
Sanitation
I Plan (1951-56) 1960.00 65.20 0.1 NA
II Plan (1956-61) 4672.00 140.80 2.20 NA
III Plan (1961-66) 8576.00 225.00 24.90 10.70
Annual Plans (1966-69) 6625.40 140.20 70.50 102.70
IV Plan (1969-74) 15,778.80 335.50 284.40 458.90
V Plan (1974-79) 39.322.00 682.00 497.40 971.00
1979-80 Outlay 11,650.00 268.20 116.20 429.50
VI Plan (1980-85) 97,500.00 1,821.05 1,010.00 3,922.02
VII Plan(1985-90) 180,000.00 3,392.89 3,256.26 6,522.47
Annual Plan(1990-91) 61,518.10 960.00 784.90 1,876.80
Annual Plan (1991-92) 72,316.80 1,185.50 749.00 2,514.40
VIII Plan (1992-97) 798,000.00 7,575.92 6,500.00 16,711.03
IX Plan (1997-02) 859,200.00 10,818.40 15,120.20 -
X Plan (2002-07) 1,484,131.30 31,020.30 27,125.00 -
XI Plan (2007-12) 136,147.00 41,092.00 90,553.00 175,000.00
Source: Park’s-2011 edition, p.816.14

No doubt, significant achievements have been made over the last six decades in the
efforts to improve health standards such as life expectancy, child mortality and maternal
mortality. Small pox and guinea worm, have been eradicated and there is hope that
poliomyelitis will also be eradicated in near future. Nevertheless, problems are abounding.
Malnutrition affects a large proportion of children. Changes in the lifestyle of the people
are resulting in a dual disease burden. This emanates from the complexity of
communicable and non-communicable diseases in the rural and urban regions of the
country .The occurrence of these disease patterns has impacted the healthcare

14
Ibid., p.No.817

15
infrastructure requirements resulting in heavy health outlays and infrastructural challenges
for the government.
NATIONAL HEALTH POLICY–2002

The Ministry of Health and Family Welfare, Government of India, evolved a

National Health Policy in 1983, keeping in view the national commitment to attain the goal
of Health for all by the year 2000. Since then there has been significant change in the
determinant factors relating to the health sector, necessitating revision of the policy, and a
new National Health Policy-2002 was evolved.15

The main objective of this policy is to achieve an acceptable standard of good

health amongst the general population of the country. The approach would be to increase
access to decentralised public health system by establishing new infrastructure in the
existing institutions. Over-riding importance was given to preventive and first line
curative initiatives at the primary health level. The policy was focused on those diseases,
which are principally contributing to disease burden such as tuberculosis, malaria,
blindness and HIV/AIDS. Emphasis was laid on rational use of drugs within the allopathic
system. To translate the above objectives into reality, the Health Policy laid down specific
goals to be achieved by year 2005, 2007, 2010 and 2015. These are as given in Table-3,
Steps are already under way to implement the policy.16
Table 1.3
Goals to be achieved by 2015
Particulars Year
Eradicate Polio and Yaws 2005
Eliminate Leprosy 2005
Eliminate Kala-azar 2010
Eliminate Lymphatic Filariasios 2015
Achieve zero level growth of HIV/AIDS 2007
Reduce mortality by 50% on account of TB, Malaria and other vector and 2010
water borne diseases

15
Ibid., p. 775.
16
Ibid., p.776.

16
 Reduce prevalence of blindness to 0.5% 2010
Reduce IMR to 30/100 and MMR to 100/Lakh 2010
Increase Utilisation of public health facilities from current level of < 20% to 2010
> 75%
Establish an integrated system of surveillance, National Health Accounts 2005
and Health Statistics
Increase health expenditure by Government as a % of GDP from the existing 2010
0.9% to 2.0 %
Increase share of central grants to constitute at least 25% of total health 2010
spending

Increase state sector health spending from 5.5% to 7% of the budget 2005

Further increase to 8% of the budget 2010

Source: http://mohfw.nic/in/

PRESENT STATE OF HEALTH CARE IN INDIA

The overall scenario of health care in India is a mixture of remarkable
achievements and failures. Over the last 60 years a vast network of healthcare services and
infrastructure has been built up. Health care in India is basically urban area oriented, two-
thirds of the hospitals are located in urban areas, and accounting for nearly four-fifths of
the beds available, serving about 30 per cent of the total population. An estimated number
of hospitals in the country is 13,692 with 5,96,203 beds available; of which, about 68 per
cent hospitals with 80 per cent beds are located in the urban areas.17

(a) Health Care Expenditure in India

Health Financing is an important component of health systems’ architecture, and
deals with sources of funding the health system. The public expenditure on health care in
India comprises by the Central Government, State Governments and the Local Bodies.
The health-care market in India, as elsewhere in the world, is based on a supply-induced
demand and keeps growing geometrically, especially in the context of new technologies.

17
Chandorkar, A.G. (2009). Hospital Administration and Planning,. Pavan Medical Publishers,
New Delhi, 2nd Edition, p.15.

17
 Berman18, in his paper on “Health Care Expenditure in India states that “At the
most aggregate level all analysists agree that non-government sources of health
expenditure far exceed the spending levels of government sources and that by far the
largest part of non-government spending is the out of pocket expenditure of individuals
and households.”
The relative size of different sources of funds for national health expenditure, as
estimated by Berman is presented in Figure 1.4.

Sources of funds for national health expenditure

10

45 21

3
21

Central government State government

Local bodies Private Sector
Household

Fig. 1.4. Sources of funds for national health expenditure

He supports his statement by referring to the small-scale house-holds surveys report

where even poor households were found to be spending between 5 to 10 per cent of their
incomes on health. Private health expenditure is relatively high as a proportion to income,
relative to the other countries in the region. Thus India has a large private health sector
and a weak public sector despite of its poverty, with the former having curative monopoly
and the latter carrying the burden of preventive services.

Low Level of Public Spending

India has worse health indices than that of a number of comparable countries in the
world. It has the world’s highest proportion of malnourished children and women. It also
has the highest load of preventable and communicable diseases, maternal deaths. Life
expectancy remains substantially low in comparison to countries with equivalent socio-

18
World Development Report 1996, Table-5, Oxford University Press, New York, 1996, p.196.

18
economic conditions, under-five mortality also remain abysmally high. One of the
important reasons for such health outcomes is that public spending in India is very low.
When compared public spending on health in India with the rest of the world, it is found
that not only the developed nations but Governments of some of the developing countries
also spend much greater share of GDP on health. Apart from India there are only 7
countries in the world where government spends less than 1 per cent of GDP on health:
Myanmar, Pakistan, Dem Rep of Congo, Burundi, Azerbaijan, Guinea and Tajikistan- the
poorest countries of the world.19

Huge Out-of- Pocket Expenditure

From a public policy point of view, it is desirable that health financing is so
arranged that it reduces the overall out-of-pocket (OOP) expenditure on healthcare, and
protects against financial catastrophe related to healthcare. The global standard related to
the ‘desirable’ limit of OOP to protect people from financial catastrophe is less than 15 per
cent of total health spending. In contrast, in India, the OOP is to the tune of 71 per cent of
total health spending.20 Even after attaining 60 years of independence, the health
expenditure in India remains an out of pocket spend for the people as the government
allows no insurance schemes for the welfare of patients. Some of the State Governments,
however, have made some efforts to improve healthcare by allocating more for the health
sector, at around 4 per cent of the total budget expenditure. Several reports of NSS have
also highlighted the fact that out-of-pocket expenditure causes indebtedness to a great
extent; the proximity of costs involved in treatment keep most of people, mostly women
and the poor, out of the health care system. There is urgent need to revert this
retrogressive system.
Healthcare Spend lowest in India: India’s healthcare spend is significantly low when
compared to the global, developed and other similar emerging economies. It is at 0.36 per
cent of the gross domestic product or 2.3 per cent of the total budget expenditure for the
financial year 2010-11. To further illustrate this point, the Indian healthcare spend is

19
Source: UNDP (2007), Human Development Report. Available at http://www.kmg.com/IN/en/
issues And Insights/Through Leadership/Emerging_Trends_in_healthcare.pdf.
20
World Health Organisation, World Health Statistics-2010.

19
examined on the following parameters. The Indian healthcare spend is less than half the
global average in percentage terms when compared on a “Percentage of GDP”.21

Spending as a % GDP
18.00%
15.70%
16.00%
14.00%
12.00%
9.70%
10.00% 8.40% 8.40%
8.00%
6.00% 4.30% 4.10%
4.00%
2.00%
0.00%
China Brazil India USA UK Global

Figure 1.5. Health care spending as % GDP

The healthcare spend, when compared on the basis of public-private contribution,

also depicts a skewed picture. As is noted from the comparison below, Private Sector
contribution to the healthcare sector at 75 per cent is amongst the highest in the world in
percentage terms. Public spending, on the other hand, is amongst the lowest in the world
and is -23 percentage points lower than the global average.22

The current annual per capita public health expenditure in the country is no more
than Re.200.Given these statistics, it is no surprise that the reach and quality of public
health services has been below the desirable standard. Finally, when the healthcares spend
is examined on a per capita basis, in terms of USD, it is amongst lowest globally, which
can be graphically depicted as under:

21
Word Health Organisation, World Health Statistics-2010.
22
World Health Organisation, World Health Statistics-2010.

20
 Comparison on Health care Spend
90.00%
80.00%
70.00%
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
C hina B razil India USA UK Global

P ublic Sector spending Private sector spending

Figure 1.6. Comparison on health care spend on per capita basis

Source: WHO World Health Statistics, 2010.23

Table 1.4
The following table shows combined expenditure of Centre and States on Health and
Family Welfare

Year Centre’s expenditure as % Total expenditure

GDP (Centre +State)
as % of GDP
2003-04 0.26 0.90
2004-05 0.26 0.85
2005-06 0.27 0.88
2006-07 0.28 0.90
2007-08 0.29 0.88
2008-09 0.33 1.02
2009-10 0.35 1.06
2010-11(BE) 0.36 ---
Source: “Union Budget” 2010-2011, available at www.cbgaindia.org24

Being the world’s second most populous country, India has been consistently
increasing the allocation for the health care of its over 1.2 billion population over the years.
Despite these efforts the spending for healthcare remains a minuscule. India has made a
jump from 0.26 per cent of GDP which was around Rs.8,086 crore or 1.6 per cent of the

23
Union Budget 2010-2011 available at www.cbgaindia.org
24
Http://in.wikipedia.org/wiki/wic./healthcare in India.

21
total budget expenditure for the year 2004-05 to Rs.25,154 crore for 2010-11. The budget
outlay for healthcare had increased to Rs.9650 crore during 2005-06 and Rs.10,948 crore
during 2006-07. The central government allocated Rs.14,410 crore for the year 2007-08
and increased to Rs.17,661 crore during 2008-09.25
As per the revised estimates during 2009-10, the allocation for health by the
Centre stood at Rs.21, 680 crore, which accounted for 2.1 per cent of the total expenditure
and 0.35 per cent of the GDP. Still, the overall spend for the vital healthcare sector always
remained far less than half a per cent of the India’s GDP hovering around a maximum of 2
per cent of the total budget whereas healthcare expenditure of most of the other developing
nations put more resources on healthcare.

The overall allocation from all the states under the Union Government of India
stood at Rs.16,048 crore during 2001-02, forming 4.4 per cent of the total budget
expenditure. It went up to Rs.43,849 crore during 2009-10, but the percentage in
proportion to the total expenditure stood at 4.2 as reports indicate. Combined with the
Centre’s outlay, the total spend on healthcare could come upto 1.02 per cent of the GDP.26
The private sector is responsible for the majority -71.6 per cent of the health burden
while the public sector accounted for 26.7 per cent. External funding constituted 1.7 per
cent of the total expenditure.27
The greater reliance on private delivery of health infrastructure and health services
means that overall these will be socially under-provided by private agents, and also deny
adequate access to the poor.

Households accounted for more than two-thirds of health spending in India and
around three times the amount of all government expenditure taken together, by the
Central, State and local governments. Among the developed nations US spends the most
over 15 per cent of its GDP for healthcare

25
Http:://en.wikipedia.org/healthcare in India
26
Private sector in Indian Health care Delivery, Information Management and Business Review,
Vol. No.2, pp.78-87.
26
Private Sector in Indian Healthcare Delivery; “Information Management and Business Review”,
Dec.2010, Vol. I, No.2, pp.79-87,

22
(b) Health Infrastructure in India
Health Infrastructure is an important indicator to understand the healthcare delivery
provisions and mechanisms in a country. It also signifies the investments and priority
accorded to creating the infrastructure in public and private sectors. Health Infrastructure
indicators is subdivided into two categories viz. educational infrastructure and service
infrastructure. Educational infrastructure provides details of medical colleges, students
admitted to M.B.B.S. course, post graduate degree/diploma in medical and dental colleges,
admissions to BDS & MDS courses, AYUSH institutes, nursing courses and paramedical
courses. Service infrastructure in health include details of allopathic hospitals, beds in
the hospitals, Indian System of Medicine & Homeopathy hospitals, sub centres, PHC,
CHC, blood banks, mental hospitals and cancer hospitals.
The present health infrastructure in the country is furnished as under.28

Medical education infrastructures in the country have shown rapid growth during
the last 20 years. The country has 314 medical colleges, 289 Colleges for BDS
courses and 140 colleges conduct MDS courses with total admission of 29,263 (in
256 Medical Colleges), 21547 and 2,783 respectively during 2010-11.

There are 2,028 Institutions for General Nurse Midwives with admission capacity
of 80,332 and 608 colleges for Pharmacy (Diploma) with an intake capacity of
36115 as on 31st March 2010.

There are 12,760 hospitals having 5,76,793 beds in the country. 6,795 hospitals are
in rural areas with 1,49,690 beds and 3,748 hospital are in Urban areas with
3,99,195 beds. Rural and Urban bifurcation is not available in the States of Bihar
and Jharkhand.

Medical care facilities under AYUSH by management status i.e. dispensaries &
hospitals are 24,465 & 3,408 respectively as on 1.4.2010.

There are 1,45,894 Sub Centres, 23,391 Primary Health Centres and 4,510
Community Health Centres in India as on March 2009 (Latest).

Total Number of licensed Blood Banks in the Country as on January 2011 are
2445.

28
National Health Profile-2010. www.cbhi.org

23
 1.5 State/Union Territory-wise Number of Govt. Hospitals & Beds in Rural & Urban Areas
(including CHCs) in India

S. State/UT/ Rural Hospitals Urban Total Projected Average Average Refe-

Popula- Popula- Popula-
No. Division (Govt.) Hospital Hospitals tion as on tion rence
tion
(Govt.) (Govt.) reference Served
Served Period
period (in per
thousand) Govt. Per
Hospital Govt.
Hospital
Bed
1 No. Beds No. Beds No. Beds
1 2 3 4 5 6 7 8 9 10 11
India 6795 149690 3744 399195 12760 576793 1160804 90872 2012

1 Andhra 143 3725 332 34325 475 38050 83964 176766 2207 01-01-
Pradesh 2011
2 Arunachal 146 1356 15 862 161 2218 1184 5920 533 01-01-
Pradesh 2009
3 Assam 108 3240 45 4382 153 7622 29814 19486 3911 01-01-
2010
4 Bihar NR Nr NR NR 1717 22494 93633 54533 4163 01-09-
2008
5 Chattisgarh 119 3270 99 6158 218 9428 22934 105202 2433 01-01-
2008
6 Goa 7 298 13 2388 20 2686 1714 85700 638 01-01-
2011
7 Gujarat 282 9619 91 19339 373 38958 57434 153979 1983 01-01-
2010
8 Haryana 61 1212 93 6667 154 7879 24597 5721 3122 01-01-
2010
9 Himachal 95 2646 47 5315 142 7961 6662 4692 837 01-01-
Pradesh 2010
10 Jammu & 61 1820 31 125 92 3945 11099 120641 2813 01-01-
Kashmir 2008
11 Jharkhand NR NR NR NR 500 5414 29745 59490 5494 01-01-
2008
12 Karnataka 468 8010 451 55731 919 63741 58181 63309 913 01-01-
2010
13 Kerala 281 13756 105 17529 36 31285 34063 88246 1089 01-01-
2010
14 Madhya 333 10040 124 18493 457 28533 71050 155470 2490 01-01-
Pradesh 2011
15 Maharashtra 735 13376 1037 36627 1772 5003 111118 62708 2222 01-01-
2011
16 Manipur 27 744 4 1574 31 22318 2421 78097 1044 01-01-
2011
17 Meghalaya 29 870 10 1967 39 2837 2591 66436 913 01-01-
2011

24
S. State/UT/ Rural Hospitals Urban Total Projected Average Average Reference
Popula- Popula- Popula- Period
No. Division (Govt.) Hospital Hospitals tion as on tion tion
(Govt.) (Govt.) reference Served
Served
period (in per
thousand) Govt. Per
Hospital Govt.
Hospital
Bed
18 Mizoram 21 801 4 710 25 1511 981 39240 649 01-01-
2010
19 Nagaland 23 705 25 1445 48 215 2197 45771 1022 01-01-
2010
20 Orissa 1629 10172 80 5708 1709 15880 40389 23633 2543 01-01-
2011
21 Punjab 72 2180 159 8440 231 10620 26391 114247 2485 01-01-
2008
22 Rajasthan 347 11850 128 20217 475 32067 64308 133491 1977 01-01-
2008
23 Sikkim 30 730 3 830 33 1560 605 18333 3888 01-01-
2011
24 Tamil Nadu 533` 25078 48 22120 581 47198 65629 112959 1391 01-01-
2008
25 Tripua 14 950 18 2081 32 3032 3574 111687 1179 01-01-
2011
26 Uttar Pradesh 515 15450 346 40934 861 56384 197271 229118 3499 01-01-
2011
27 Uttarakhand 666 3746 29 4219 695 7965 9511 13865 1194 01-01-
2009
28 West Bengal 14 2399 280 52360 294 54759 87839 298772 1604 01-01-
2010
29 A&N island 7 385 1 450 8 835 480 60000 575 01-01-
2011
30 Chandigarh 1 50 3 570 4 620 1368 342000 2206 01-01-
2011
31 D&N Haveli 1 50 1 231 2 281 337 168500 1199 01-01-
2011
32 Daman & Diu 0 0 4 200 4 200 259 64750 1295 01-01-
2011
33 Delhi 21 972 109 22886 130 23858 16955 130423 711 01-01-
2009
34 Lakshadweep 5 160 - - 5 160 75 15000 469 01-01-
2011
35 Puducherry 1 30 13 2311 14 2341 1331 95071 569 01-01-
2011
Notes:
• Government hospitals includes Central Government, State Government and local govt. bodies
• Rural & Urban beneficiaries is not available in Bihar & Jharkhand.
Source: Directorate General of State Health Services, 2010.

25
Service Infrastructure

1.6 State/UT wise Number of sub-centres, PHCs & CHCs Functioning in India as on March
2009 (Latest)

S.No. State/UT Sub Centres PHCs CHGc

1 2 3 4
India 145894 23391 4510
1 Andhra Pradesh 12522 1570 167
2 Arunachal Pradesh 592 116 44
3 Assam 4592 844 18
4 Bihar 8858 1776 70
5 Chattisgarh 4776 715 144
6 Goa 171 19 5
7 Gujarat 7274 1084 281
8 Haryana 2465 437 93
9 Himachal Pradesh 2071 449 73
10 Jammu & Kashmir 1907 375 85
11 Jharkhand 3947 321 194
12 Karnataka 8143 2193 324
13 Kerala 4575 697 226
14 Madhya Pradesh 8869 1155 333
15 Maharashtra 10579 1816 376
16 Manipur 420 72 16
17 Meghalaya 401 105 28
18 Mizoram 370 57 9
19 Nagaland 397 123 21
20 Orissa 6688 1279 231
21 Punjab 2950 394 129
22 Rajasthan 10951 1503 367
23 Sikkim 147 24 0
24 Tamil Nadu 8706 1277 256
25 Tripua 579 76 11
26 Uttar Pradesh 1765 239 55
27 Uttarakhand 20521 3690 515
28 West Bengal 10356 92 334
29 A&N island 114 19 4
30 Chandigarh 16 0 2
31 D&N Haveli 38 6 1
32 Daman & Diu 26 2 2
33 Delhi 41 8 0
34 Lakshadweep 14 4 3
35 Puducherry 53 24 3

Source: Bulletin on Rural Health Statistics in India 2009, Infrastructure Division MOHFW/GOI

26
 1.7 Medical Care Facilities under AYUSH by Management Status as on 1-04-2010

Sl. Manageme Ayurveda Unani Siddha Yoga Naturo Homoeopathy A Total

N nt pathy mc
hi
o.

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries
Hospitals

Hospitals

Hospitals

Hospitals

Hospitals

Hospitals

Hospitals

Hospitals
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
A. Under jurisdiction of States/Union Territories
1 States/Govt/ 2233 13897 232 172 268 525 4 29 9 70 96 5445 0 5 2842 21043
UT
administra-
tion
2 Local 20 886 0 45 0 0 0 0 0 8 0 1084 0 0 20 2023
Bodies
3 Others 181 346 26 8 4 0 5 53 143 176 144 201 2 129 505 907
15129 258 1125 272 525 152 254 240 6730
Total (A) 2434 9 82 32 134 3367 23973
B. CGMS & Central Government organisations
4 CGHS 1 33 0 10 0 3 0 4 0 0 0 35 0 0 1 85
5 Railway 0 40 0 0 0 0 0 0 0 0 0 129 0 0 0 169
Ministry
6 Labour 0 130 0 0 0 5 0 0 0 0 0 32 0 0 0 167
Ministry
7 Ministry of 0 16 0 0 0 0 0 0 0 0 0 0 0 0 0 16
col
8 Research 22 4 7 10 2 2 0 0 0 5 3 29 0 1 34 51
councils
9 National 3 1 1 0 1 0 0 0 0 1 1 2 0 0 6 4
Institutes
Total 26 224 8 20 3 10 0 4 0 6 4 227 0 1 41 492
All India 2460 15353 266 1145 275 535 9 86 152 260 244 6957 2 135 3408 24465
(A+B)

Source: AYUSH, Ministry of Health & Family Welfare

27
 1.8 Statewise/Systemwise Number of AYUSH Hospitals and Dispensaries in India as on
1-4-2010

Ayurveda Unani Siddha Yoga Naturo Homoeop Amchi Total

S. States/UTs pathy athy
No & others

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries

Dispensaries
.
Hospitals

Hospitals

Hospitals

Hospitals

Hospitals

Hospitals

Hospitals

Hospitals
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
A. States/Union Territories
1 Andhra 8 1003 6 269 0 0 0 225 31 312 6 518 0 1 51 2327
Pradesh
2 Arunachal 11 2 0 0 0 0 1 1 0 2 1 55 0 6 13 60
Pradesh
3 Assam 1 380 0 1 0 0 1 25 4 7 3 75 0 0 9 488
4 Bihar 11 311 4 144 0 0 1 0 2 0 11 179 0 0 29 634
5 Chattisgarh 9 1272 1 26 0 0 0 15 2 5 3 172 0 1 15 1490
6 Delhi 17 158 3 30 0 0 2 4 5 5 2 127 0 3 29 524
7 Goa 1 11 0 0 0 0 0 0 1 4 1 5 0 0 3 20
8 Gujarat 51 542 0 0 0 0 0 5 3 14 16 216 0 1 70 777
9 Haryana 8 493 1 7 0 0 0 0 8 4 1 22 0 18 526
10 Himachal 27 1105 3 0 0 0 0 2 0 1 14 2 14 32 1122
Pradesh
11 Jammu & 2 273 2 235 0 0 0 01 0 0 0 0 0 82 5 508
Kashmir
12 Jharkhand 1 122 0 30 0 0 0 0 1 0 2 54 0 0 4 206
13 Karnataka 133 561 14 50 0 0 4 0 36 45 21 43 0 7 208 699
14 Kerala 126 898 0 12 2 5 0 5 46 40 32 526 0 0 206 1486
15 Madhya 28 1427 2 5 0 0 0 4 8 13 20 146 0 0 58 1640
Pradesh
16 Maharashtra 55 469 5 25 0 0 2 0 12 10 45 0 0 3 119 504
17 Manipur 0 30 1 13 0 0 0 12 12 12 4 178 0 0 17 245
18 Meghalaya 4 14 0 0 0 0 0 1 0 0 7 35 0 1 11 50
19 Mizoram 7 2 0 0 0 0 0 0 1 0 7 11 0 0 15 13
20 Nagaland 0 109 0 0 0 0 0 0 0 1 2 93 0 0 2 203
21 Orissa 8 624 0 9 0 0 0 5 2 45 6 637 0 2 16 1320
22 Punjab 15 507 0 35 0 0 0 1 1 5 5 107 0 0 21 655
23 Rajasthan 113 3568 5 110 0 0 1 0 9 13 11 180 0 0 139 3871
24 Sikkim 1 1 0 0 0 0 0 0 0 0 0 1 0 3 1 2
25 Tamil Nadu 8 43 1 21 270 297 0 21 59 51 9 46 0 1 347 679
26 Tripua 1 54 0 0 0 0 0 0 3 0 1 80 0 0 5 134
27 Uttar Pradesh 1774 340 210
49 0 0 0 5 10 5 8 1575 0 1 2002
1974
28 Uttarakhand 7 467 2 3 0 0 1 3 6 3 1 60 0 3 17 536
29 West Bengal 4 295 1 3 0 0 0 0 4 5 12 1534 0 5 21 1837
30 A&N island 1 8 0 0 0 0 0 1 0 0 1 17 0 0 2 26
31 Chandigarh 1 8 0 0 0 0 0 0 0 0 0 1 0 0 2 15
32 D&N Haveli 0 3 0 0 0 0 0 0 0 0 0 1 0 0 0 4
33 Daman & 0 6 0 0 0 0 0 0 0 0 0 5 0 0 0 11
Diu
34 Lakshadweep 0 2 0 0 0 0 0 0 0 0 0 1 0 0 0 3
35 Puducherry 1 21 0 0 0 23 0 2 0 3 0 10 0 0 1 59

28
B. CGHS & 26 224 8 20 3 10 0 4 0 6 4 227 0 1 41 495
Central
Government
organisation
2460 266 1145 275 535 339 269 610 244 2 135 3529
Total (A+B) 15353 13 6957 24943

*-Figures for the current year has not been received hence repeated for the latest available year.
# Under clarification (UC)
Source: AYUSH, Ministry of Health & Family Welfare

There has been a constant policy support to traditional medicine in India. However,
in order to augment the development of traditional systems of medicine in a systematic
manner, the Government of India put in place a separate National Policy on Indian
Systems of Medicine & Homeopathy in the year 2002. The strategies outlined in this
policy are in line to that encompassed in the WHO strategy for Traditional Medicine. The
major objectives of the national policy for Ayurveda, Yoga, Naturopathy, Unani, Siddha
and Homeopathy (AYUSH) are:
(i) To promote holistic health and expand the outreach of healthcare to people
through preventive, promotive, mitigative and curative intervention of AYUSH;
(ii) To ensure affordable AYUSH services & drugs, which are safe and efficacious;
(iii) To facilitate availability of quality raw drugs, which are authentic and contain
essential components as required under pharmacopoeial standards to help improve
quality of drugs, for domestic consumption and export;
(iv) To integrate AYUSH in healthcare delivery system and national health
programmes and ensures optimal use of the vast infrastructure of hospitals,
dispensaries and physicians;
(v) To provide full opportunity for the growth and development of AYUSH systems
and utilization of the potentiality, strength and revival of their glory.

Under the Ministry of Health & Family Welfare, there is a separate Department of
Indian Systems of Medicine & Homeopathy since 1995, which has now been renamed as
the Department of Ayurveda, Yoga, Unani, Siddha and Homoeopathy (AYUSH). The
Department comprises of administrative staff headed by a Secretary and system- wise
technical officers headed by Advisors.

29
1.9 Number of Dispensaries under Central Government Health Schemes (CGHs)
in Different Cities as on 31-3-2010

S.No. Name of the City Type of Poly. CGHS Dental

Dispensaries Clinic Lab Units
1 2 3 4 5 6 7
1 Ahmedabad 3 2 1 1 1
2 Allahabad 7 2 1 1 0
3 Bangalore 9 4 1 3 1
4 Bhopal 1 9 0 0 0
5 Bhubaneswar 2 1 0 1 0
6 Chandigar 1 0 0 0 0
7 Chennai 14 4 2 4 1
8 Dehradun 1 0 0 0 0
9 Guwahati 3 1 0 0 0
10 Hyderabad 13 6 2 1 2
11 Jabalpur 3 0 0 1 0
12 Jaipur 5 2 1 3 1
13 Kanpur 9 3 3 1
14 Kolkata 18 4 1 5 1
15 Lucknow 6 3 1 3 0
16 Meerut 6 2 2 1 0
17 Mumbai 26 5 2 4 3
18 Nagpur 11 3 1 1 1
19 Patna 5 2 1 1 1
20 Pune 7 3 1 2 1
21 Ranchi 2 0 0 1 0
22 Shillong 1 0 0 0 0
23 Thiruvanantapuram 3 2 0 0 0
24 Delhi 87 36 4 31 6
TOTAL 246 85 22 67 20

Note: This table shows only the number of dispensaries in different cities. For exact address of the
dispensaries please contract the source agency.

Source: Central Government Health Scheme, Dte. GHS, M/o.Health & FW, Nirman Bhawan, New
Delhi.

30
Deficiencies in Healthcare Infrastructure
One of the important drivers of growth in the healthcare sector is India’s booming
population, currently 1.1 billion and increasing at a 2 per cent annual rate. By 2030, India
is expected to surpass China as the world’s most populous nation. By 2050, the population
is projected to reach 1.6 billion. India’s healthcare infrastructure has not kept pace with
the population growth.
The physical infrastructure is woefully inadequate to meet today’s healthcare
demands, much less tomorrows. While India has several centres of excellence in healthcare
delivery, these facilities are limited in their ability to drive healthcare standards because of
the poor condition of the infrastructure in the vast majority of the country.
The healthcare infrastructure in India is inadequate compared with the global
standards. It lags behind the global average in terms of healthcare infrastructure and
manpower. India has an average 0.6 doctors per 1000 population against the global
average of 1.2329 which suggests an evident manpower gap.
Table 1.10
Comparison of Health infrastructure in India with the Global Standards
Year India USA UK Brazil China
Hospital Bed Density 2000- 12 31 39 24 30
(per 10000 population) 2009
Doctor Density 2000- 6 27 21 17 14
(per 10000 population) 2009
Births attended by 47 99 NA 97 98
skilled health personnel 2009
(percent)
No.of Doctors 2009 6,43,520 7,93,648 1,26,126 3,20,013 18,62,630
No.of Nurses 2009 13,72,059 29,27,000 37,200 5,59,423 12259240
No.of Dentists 2009 55,344 4,63,663 25,914 2,17,217 1,36,520
Average No.of Doctors 0.6 0.81 0.53 0.69 0.46
per bed 2009
Average No.of Nurses 1.27 3 0.16 1.18 3. 02
per bed 2009
No. of Doctors per 1000 0.6 2.7 2.1 1.7 1.4
population 2009
No. of Nurses per 1000 2009 1.3 9.8 0.6 2.9 1
population
Source: www. Occd.org, www.wholndia.org30

29
www.oecd.org, www.whoindia.org.
30
National Health Profile-2010, www.ebhi.org

31
 In 2009, the number of beds available per 1000 people in India was only 1.27,
which is less than half the global average of 2.6. There are 369,351 government beds in
urban areas and a mere 143,069 beds in rural areas.31
Parameter 2008 2018 2028

Additional Beds Required 1.1 million 3.1 million 2 million

Bed/1000 population ratio 0.7 to 1.7 million 4 5 million

Source: CII Technopak32

At six doctors per 10,000 people, the number of qualified doctors in the country is
not sufficient for the growing requirements of Indian healthcare. Moreover, rural “doctors
to population” ratio is lower by 6 times as compared to urban areas.33

Parameter Current Annual To fill the Gap

Production
Physicians 30.558 9,93,500
Nurses 1,14,218 2,510,250
Source: CII Technopak34

As of financial year 2010, India had approximately 300 medical colleges, 290
colleges for Bachelor of Dental Surgery and 140 colleges for Master of Dental Surgery
admitting 34,595, 23,.510 and 2,644 students annually respectively. India needs to open
600 medical colleges (100 seats per college) and 1500 nursing colleges (60 seats per
college) in order to meet the global average of doctors and nurses. Moreover, the medical
personnel are concentrated in urban areas. Around 74 per cent of the graduate doctors in
India work in urban settlements, which account for approximately one-fourth of the
population only. The countrywide distribution of these institutes is also skewed, as 61
percent of the medical colleges are in the 6 states of Maharashtra, Karnataka, Kerala,

31
CII, Technopak Report. Op.cit., Ref.19.
32
Ibid.
33
Ibid..
34
Task Force on Medical Education for the National Rural Health Mission and the National
Medical Journal of India, Vol.23 No.3, 2010.

32
Tamil Nadu, Andhra Pradesh and Pondicherry, while only 11 percent are in Bihar,
Jharkhand, Orissa and in West Bengal and the North-Eastern states.35

CHALLENGES OF INDIAN HEALTHCARE SECTOR

While the Indian Healthcare sector is poised for growth in the next decade, it is still
plagued by various issues and challenges:
1. Dual Disease Burden: Urban India is now on the threshold of becoming the
disease capital of the world and facing an increased incidence of Lifestyle related
diseases such as cardiovascular diseases, diabetes, cancer, COPD etc. At the same
time, the Urban Poor and Rural India are struggling with Communicable Diseases
such as tuberculosis, typhoid, dysentery etc. Rural India is also seeing a higher
occurrence of Non-Communicable Life-style related diseases. This represents a
serious challenge that the Indian Healthcare system would need to address
2. Urban Hospital Concentration: More and more doctors are concentrating in
larger cities; as a result the quality of service which the outlying communities get
has remained mediocre. The government and health care services are increasingly
dependent upon young doctors to provide medical care services through measures
promoting two or three year’s rural service in peripheral hospitals and primary
health care centres. This is not a pleasing arrangement for rural people who have
constant change of their doctors and the latter regards his/her stay as temporary one
with no future to it in the rural health centre/hospital.
3. Lack of Infrastructure and Manpower: Accessibility to healthcare services is
extremely limited to many rural areas of the country. In addition, existing
healthcare infrastructure is unplanned and is irregularly distributed. Further, there is
a severe lack of trained doctors and nurses to service the needs of the large Indian
populous.
The private sector has evolved a multi-pronged approach to increase accessibility
and penetration. It has tackled the issue of lifestyle related diseases with the development
of high-end tertiary care facilities. Also new delivery models such as day-care centres,

35
Associated Chamber of Commerce & Industry (ASSOCHAM) Report, “Emerging Trends in
Healthcare”, February, 2011 op.cit. Ref.19.

33
single speciality hospitals, end-of-life care centres, etc., are on the horizon to service larger
sections of the population and address specific needs.

Initiatives by the Government

To tackle the challenges mentioned, the Government has taken various initiatives to
improve the Public Healthcare system in India. The Government launched the National
Rural Health Mission (NRHM) in 2005 which aims to provide quality healthcare for all
and increase the expenditure on healthcare from 0.9 per cent of GDP to 2-3 per cent of
GDP by 2012.
According to Union Budget 2010-11, the plan allocation for Ministry of Health and
Family Welfare has increased from USD 4.2 billion in 2009-10 to USD 4.8 billion in 2010-
11.
Moreover, in order to meet revised cost of construction, in March 2010 the
government allocated an additional USD 1.23 billion for six upcoming AIIMS - like
institutes and up-gradation of 13 existing Government Medical Colleges

The Union Cabinet on October 20, 2010 approved the proposal of the Ministry of
Health and Family Welfare to declare National Institute of Mental Health and Neuro
Sciences (NIMHANS), Bangalore as an Institute of National Importance on the lines of All
India Institute of Medical Sciences, New Delhi, Post-Graduate Institute of Medical
Education and Research, Chandigarh and Jawaharlal Institute of Postgraduate Medical
Education and Research, Puducherry.36

Private-Public Partnerships (PPP)

The Indian Government is focused on developing the PPP model to cover the
demand-supply gap prevalent in the healthcare sector. Private sector expertise coupled
with efficiencies in operation and maintenance would lead to improved healthcare services
delivery to the masses. This model can act as a catalyst in the creation of new capacity and
improvement of efficiency in the existing infrastructure established. The Government also
embraced PPP model to counter epidemics like H1-N1 swine flu, HIV, etc. However, it is
evident that this model be far more beneficial.

36
First Call Research, Apollo Hospitals Enterprise Limited Company, Research Report, Q2, 2011.

34
 A few successful PPP projects are mentioned below:
 Karnataka Karuna Trust; Yashaswini Scheme
 Tamil Nadu Mobile health services
 Andhra Pradesh Aarogyasri
 Andhra Pradesh Diagnostic Services for 4 Medical Colleges
 West Bengal Mobile health services
 Madhya Pradesh Community outreach program
 Rajasthan Contracting in public hospitals
 Gujarat Chiranjeevi Project

Future of Health Care in India

India’s healthcare sector is expected to grow at 23% annually to become a US 77
billion industry by 2012 37
 The demand for hospital beds in India is expected to be around 2.8 billion by 2014
to match the global average of 3 beds per 1000 population from the present 0.7
beds.
 India needs 100,000 beds each year for the next 20 years at over USD 10 billion per
year.
 Healthcare has emerged as one of the most progressive and largest service sectors
in India with an expected GDP spend of 8% by 2012 from 5.5% in 2009.
 20 health cities are expected to come up in the next 5 years.
 The medical tourism industry is set to touch USD 2 billion by 2010 with an annual
growth rate of 30%.
 The booming hospital service industry is projected to grow at 9% during 2010–
2015.
 Strong demand for hospital services in tier-II and tier-III cities will also fuel growth
of the sector.

37
Associated of Chamber of Commerce Industry (ASSOCHAM) Report, 2011. Available at
http://www.indiahealthcare.in.

35
 The corporate India is therefore, leveraging on this business potential and various
health care branches have started aggressive expansion in the country. Some of the
companies that plan to increase their footprints include Anil Ambani’s Reliance Health, the
Hindujas, Sahara Group, Emami, Apollo Tyres and the Panacea Group.

Sahara Group is planning several healthcare projects such as a 200-bed multi-

speciality tertiary care hospital at Gorakhpur in Uttar Pradesh, a 1,500-bed multi-super-
speciality, tertiary care hospital at Aamby Valley City and 30-bed multi-speciality
secondary care hospitals across all the 217 Sahara City Home Townships. Meanwhile,
Artemis Health Sciences (AHS), a health care venture of the Apollo Tyres Group, is also
planning to establish four to eight multi-specialty hospitals in Punjab, Uttar Pradesh,
Madhya Pradesh, Rajasthan and Haryana over the next three years. The rural healthcare
sector is also on an upsurge. The Rural Health Survey Report 2009, released by the
Ministry of Health, stated that during the last five years rural health sector has been added
with around 15,000 health sub-centres and 28,000 nurses and midwives. The report further
stated that the number of primary health centres have increased by 84 per cent, taking the
number to 20,107.
The size of the Indian medical technology industry may touch US $ 14 billion by
2020 from US $ 2.7 billion in 2008 on account of strong economic growth, higher public
spending and private investments in healthcare, increased penetration of health insurance
and emergence of new models of healthcare delivery, according to a report ‘Medical
Technology in India: Enhancing Access to Healthcare through innovation”.38

Health Insurance
The majority of the Indian population is unable to access high quality healthcare
provided by private players as a result of high costs. Many are now looking towards
insurance companies for providing alternative financing options so that they too may seek
better quality healthcare.
The opportunity remains huge for insurance providers entering into the Indian
healthcare market since 75% of expenditure on healthcare in India is still being met by
‘out-of-pocket’ consumers. Even though only 10% of the Indian population today has

38
http://www.expresshealthcaremgt.com

36
health insurance coverage, this industry is expected to face tremendous growth over the
next few years as a result of several private players that have entered into the market.
Health insurance coverage among urban, middle and upper-class Indians, however, is
significantly higher and stands at approximately 50%.

The Insurance Regulatory and Development Authority (IRDA) is the governing

body responsible for promoting insurance business and introducing insurance regulations
in India. The share of public sector companies in health insurance premiums was 76% and
that of private sector companies was 24% for the period 2005-06. Health insurance
premiums collected over 2005-06 registered a growth of 35% over the previous year.
In 2001, the IRDA introduced provisions for Third Party Administrators (TPAs) to
support the administration and management of health insurance products offered by
insurance companies. TPAs are facilitators in the coordination process between the health
insurance provider and the hospital. Currently there are 27 TPAs registered under the
IRDA.
Health insurance has a way of increasing accessibility to quality healthcare delivery
especially for private healthcare providers for whom high cost remains a barrier. In order
to encourage foreign health insurers to enter the Indian market the government has recently
proposed to raise the foreign direct investment (FDI) limit in insurance from 26% to 49%.
Increasing health insurance penetration and ensuring affordable premium rates are
necessary to drive the health insurance market in India.

In an ultimate analysis, a society will be judged by its ability to provide universal

health for its people. This does not merely entail the ability to treat diseases and ailments
but also to prevent their onset by means of suitable systems and measures. Better sanitary
conditions and improved micro-environment in the habitat or work place are the most
important requirements. High productivity requires a healthy workforce. Good and clan
environment, better nutrition, preventive health measures and periodic health check-ups
and treatment are the next steps. If one is able to foresee the biggest health threats, we can
shape dynamic new policies that will ensure low-cost, universal care, healthy behaviour
and remarkably long-lived, productive human capital, says Nandan Nilekani.

37
 At this juncture, the researcher wishes to recall the valuable piece advice given by
the former president Dr. A.P.J. Abdul Kalam to the students of MGR Medical University,
Chennai during its convocation on 21st March 1996. “The health of all our people is vital
even while we are pursuing the all round rapid growth of the economy and technical
powers. People’s health leads to better economic and social progress. Many recent
technological inventions are making it possible to reach health services to all. Sensors and
information technologies in particular, are making it possible for access of specialist
attention to short term rapid action and emerge as a nation with excellent health services
cover which would be an example to the world”.

ROLE OF HOSPITAL IN HEALTH CARE

A Hospital is an integral part of a Social and Medical organisation, the function of
which is to provide for the population complete health care, both curative and preventive,
and whose outpatient services reach out to the family and its home environment; the
hospital is also a centre for the training of health worker and biosocial research -- World
Health Organisation (WHO)

The word ‘hospital’ is derived from the Latin word hospitalis which comes from
‘hospes, meaning a host. The English word ‘hospital’ comes from the French word
‘hospitale’, as do the words ‘hostel and hotel, all originally derived from Latin. The three
words, hospital, hostel and hotel, although derived from the same source, are used with
different meaning. The term ‘hospital’ means an establishment for temporary occupation
by the sick and the injured.
A few definitions of the term hospital are given below.
According to the Directory of Hospitals in India, 1988,‘ a hospital is an
institution which is operated for the medical, surgical and/or obstetrical care of in-patients
and which is treated as a hospital by the Central/State Government/Local Body/Private and
licensed by the appropriate authority.
Blackstone’s New Gould Medical Dictionary39 describes a hospital as an
institution for medical treatment facility primarily intended, appropriately staffed and
equipped to provide diagnostic and therapeutic services in general medicine and surgery or

38
in some circumscribed field or fields of restorative medical care, together with bed care,
nursing care and dietetic service to patients requiring such care and treatment.
Syed Amin Tabish,40 defines the hospital as “An institution whose primary
function is the provision of a variety of diagnostic and therapeutic services of patients, both
in the hospital and in the outpatient clinics. It is umbrella organisation under which many
individual health care professionals provide some or all of their services. More than 30
disciplines are represented in most hospitals, each having its own processional structure,
body of knowledge, code of ethics, and technical procedures. A hospital is also a social
institution, dealing daily with a broad panorama of human hopes, fears, and concerns.
Finally, a hospital is a business, responsible for the efficient, cost-effective provision of
wide range of services”.
On the basis of the above definitions, R.C. Goyal41 evolved a comprehensive
definition of a hospital highlighting all the essential services rendered by a modern
hospital.
A modern hospital is an institution which possesses adequate accommodation and
well qualified and experienced personnel to provide services of curative, restorative and
preventive character of the highest quality possible to all people regardless of race, colour,
creed or economic status; which conducts educational and training programmes for the
personnel particularly required for efficacious medical care and hospital service; which
conducts research assisting the advancement of medical service and hospital services and
which conducts programmes in health education.

Development of Hospitals
During the early period of Greek and Roman civilisations, the temples were used as
hospitals. The healing art practised by the priests was established by ‘Aesculapius’ – the
Greek God and the father of medicine - some centuries before the birth of Christ. It spread
gradually all over the Greece and Rome and the priests built about 200 Aesculapius;
temples for the treatment of sick both in mind and body.

39
Blackstone’s New Gould Medical Dictionary, McGraw-Hill, New York, 1956, p.560.
40
Syed Amin Tabish. “Hospitals and Nursing Homes, Planning, Organisation and Management,
2005. Jaypee Medical Publishers P.Ltd., New Delhi, p.12.
41
Goyal, R.C. “Handbook of Hospital Personnel Management”, New Delhi: Prentice-Hall
International, Inc., 1993, pp.3-4.

39
 In ancient China, free clinics for the sick were established very early and by 300
B.C. Alum’s houses were established for deaf, mutes, cripples and the insane.

The Islamic world in the West Asia showed great initiative in setting up hospitals
in early sixth century. During second half of Eighth Century, Khalifa, Harun-Al-Rashid
established a group of hospitals in Bangladesh which rose to 60 or 50 by 1160 A.D. Other
hospitals were also come up in Damascus, Bukhara, Seville and Cairo Cordoba supported a
University which closely associated with at least 50 hospitals. The famous Mansuri
hospital at Cairo dates back in 1284 AD.
I. Hospitals in Ancient Asia: Srilankans are responsible for introducing the
concept of dedicated hospitals to the world. King Pandukabhaya had lying in-
homes and hospitals built in various parts of the country ‘Mugubtale’ Hospital
is perhaps the oldest one in the 200 BC. King Asoka founded 18 hospitals in
230 BC which were supported by the state. The first ‘Teaching Hospital’ was
the ‘Academy of Gundishpur in the Persian Empire.
II. Hospitals in Christian Era [Medieval period]: With the birth and spread of
Christianity there was an impetus to hospitals which become an integral part of
the Church and its monasteries. Medicine was reverted to religion, the nuns and
monks practising it. Gradually these Christian hospitals replaced those of
Greece and Rome. During the crusades (Christian expeditions to recover the
Holy Land from Mohammedans, 1100-1300 A.D.). Over 19,000 hospitals were
founded in Europe to cater to the medical needs of the injured in wars. St. John
was responsible for creating chain of hospitals, which still function as “St. John
Ambulance Corps” in England with its branches all over the world including
India.
III. Hospitals in Renaissance: In the early 18th century, with the social awakening,
voluntary hospitals sprang up in towns and cities all over the Europe. Groups
of men gathered together to provide resources to the health needs of the sick
and poor. The Pennsylvania hospital founded in Philadelphia in 1751 is the
first voluntary hospital followed by network hospital in 1773 Massachusetts
General Hospital in 1861, New Heaven Hospital in 1826. It has been estimated

40
 by 1840, there were about 50 permanent hospitals in the U.S. most of which
were of voluntary type.
IV. Hospitals in 19th century: The 19th century witnessed a radical change in the
functions of the hospitals on account of arrival of Florence Nightingale of the
hospital scene. She was responsible for revolutionising the concept of Nursing
Hospitals besides offering free services began to establish differential pricing
policies depending upon the financial capabilities of the patients. The practice
of deficit financing was started which is still continuing.
Various developments in the fields of medical science gave impetus to
further progress in the hospital field. Discovery of anaesthesia and the
principles of antisepsis, steam sterilisation in 1886, X-ray in 1895 gave a Philip
to the hospital development. Besides scientific advances during this period,
rapid industrialisation during the last quarter of 19th century generated
enormous funds in the Western World.
V. Developments of Modern Hospitals in the New Millennium: The 20th
century has been a period during which hospitals have been called on to provide
an increasing number of services to the patients. Today’s hospitals are hi-tech
organisations furnished with hi-tech gadgets, as soon as the patients enter the
main gate of the hospital, there are modern sophisticated electronic devices for
security check till he leaves the organisation with electronic checkout system.
A hospital was no longer a place where people went to die. The advances in
medical science brought about by antibiotics, radiation, blood transfusion,
improvements in anaesthetic techniques and the spectacular advances in
surgical techniques and medical electronics have all brought about tremendous
growth and improvement in hospital services.42

Hospitals in India
The forerunners of the present hospitals can be traced to the times of Buddha
followed by Ashoka. India could proudly boast a very well organised hospitals and
medical care system even in the ancient times. Medicine based on Indian system was

41
 taught in the ancient university of Taxila. The famous writings by Sushruta (6th century
BC) and Charak’s Chaeraka Samhita (200 A.D.) which provide instructions of creation of
hospitals, for lying-in and children rooms, maintenance and sterilisation of bed linen with
steam and fumigation and use of syringes other medical appliances, were considered as
standard works for centuries together.

However, the age of Indian medicine started its decline during Mohammedan
invasion in 10th century and their system of medicine Yunani and its physicians started to
prosper at the expense of Ayurveda.

The modern system of medicine in India was introduced in 17th century by

European Christian missionaries in south India. The East India Company established its
first hospital in 1664 at Madras for its soldiers and in 1668 for civilian population. After
that there was a steady growth of hospitals pushing background the indigenous system of
medicine

The Changing Structure of Hospitals in India

The hospitals have travelled a long journey from a time when the aim of the hospital
was to provide care, comfort and assurance to the patients with a team of dedicated doctors
and nurses, whose aim was never based on, to earn money, but to serve the poor, helpless
and destitute. Hospital used to be synonym to temple, the doctors were treated as Gods and
the patients were treated as guests ‘to serve patient, was synonymous to serve God’. But,
there is a sea change in the scenario of hospitals in the contemporary times. The concept of
today’s hospital contrasting fundamentally from the old idea of a hospital as no more than a
place for the treatment of the sick.
The health care services have undergone a steady metamorphosis, and the role of
hospital has changed, with the emphasis shifting from:
i. Acute to chronic illness
ii. Curative to preventive medicine
iii. Restorative to comprehensive medicine
iv. Inpatient care to outpatient and home care

42
Sakhararkar, B.M. (2009). “Principles of Hospital Administration & Planning”, J.P. Brothers
Medical Publishers P. Ltd., New Delhi, p.7

42
 v. Individual orientation to community orientation
vi. Isolated function to area-wise and regional function
vii. Tertiary and secondary to primary health care
viii. Episodic care to total care

The hospital at present are functioning in a dynamic environment due to fast

changes in economic, social, political, cultural scenario and latest developments in the
fields of science and technology and attitude of the people which results in accelerating
changes in the management of hospital, It is therefore quite obvious to look at the
evolution of hospitals within the environment in which it operates.

The important factors which have led to the changing role and functions of the
hospitals are:

1. Expansion of the clientele from the dying, the destitute, the poor and needy to all
classes of people.
2. Improved economic and social status of the community.
3. Progress in the means of communications and transportation.
4. Increasing health awareness.
5. Rising standard of living (especially in urban areas) and socio-political awareness
(especially in semi-urban and rural areas) with the result that people expect better
services and facilities in health care institutions.
6. Control and promotion of quality of care by statutory and professional associations.
7. Increase in specialisation where need for team approach to health and disease is now
required.
8. Advances in administrative procedures and management techniques.
9. Rapid advances in medical science and technology.
10. Sophisticated instrumentation, equipment and better diagnostic and therapeutic tools.
11. Political obligation of government to comprehensive health care.
12. Awareness of community.

43
 Table 1.11
Changing Concept of Hospitals in 20th Century

Health Services Environment Implications for Hospital

Year Technology Economic Political Objectives Management
Trustee period
Application of modern Limited resources Limited mainly to Main comfort Solicit donations
1900 public health measures provided by local Government services to the and pennies,
donations free support of public poor and dying trustees or
service from hospitals in larger religious members
religious groups cities dominate
and physicians and
payments by
individuals
Reform in medical
1910 education (Flexner
Report)

Rise of modern Illness

surgery intervention
through
surgical
services
Physician Period

1920 Development of Meets needs of

medical specialisation individual
Managing
Directors.
Managing
Directors begin to
dominate as
technology
advances and
hospitals depend
on patient receipts
Sakhar Progressing Private insurance Risk of
arkar,p therapeutics as Blue Cross
developed and
diagnostic and
curative
7 expanded medicine
1930 increasing
resources

Development of Expansion of private

1940 laboratory medicine hospitals

1950

44
Administration period

1960 Explosion of medical Increase in Expansion of Rise of hospital

knowledge and access to care scope, management to co-
application of nuclear, and quality sophistication ordinate complex
immunological, etc. volume, income organisation, obtain
technologies in and other external resource
proliferation of facilities and develop
specialities facilities.
Administrators
dominate

Expanded nursing Increasing Cost

1970 role, team medicine Government containment
control of attempts by
resources regulation
(Medicare and
Medical aid)

Restricted By competition Multi- Corporate

1980 resources resource limits institutional Management
system applying advanced
development management
techniques to cope
up with external and
internal
confrontation

Manpower surpluses, Employer control Employer Consolidation of Team management

1990 self-care medicine over costs control over services
services

Patient-Customer Period
2000- Men, Money,
2010 Materials, Machines, Patient control Patient control Patient centred Team Management
Methods and over costs over services care
Mobility of ideas

The major changes in the concept of hospitals can be divided into different periods
such as (1) Trusteeship Period (2) Physician Period and (3) Administration Period (4)
Growth of Corporate Sector
1. Trusteeship Period: Most of the hospitals were run and managed by trustees. The
advancements in technology were minimal during that period. This period had
lasted till 1920. The doctors and nurses had not worked for money, the approach
was only humanitarian. The objective of the hospital was to provide comfort to the
people.

45
 2. Physician Period: It was physicians dominated period. The hospitals were being
utilised for medical practices. The laboratory medicine developed during the period
1940 to 1950. The economic and political environment began to effect hospitals.
Labour unions gained power. Rural hospitals were established. Hospitals survived
and succeeded not through cost control but through increased income.
3. Administrative and Team Periods: The hospital practice became a team approach
.The advances in technology became more rapid. The use of computers in patient’s
care and management of hospitals changed the scenario. People started thinking
about the professionally managed hospitals.
4. Growth of Corporate Sector: With the liberalisation, privatisation and
globalisation policies of the government and rapid advancements in the field of
information technology, with fast and safe travel all over the world lead to the
concepts of medical tourism in the country. In this context, the concept of hospital
has changed from service to profit making approach. The doctors have started
thinking on management principles and a function for productivity. Telemedicine is
a new addition. The new merging concept of contracting or Private-Public-
Partnership (PPP) is also growing very fast due to government thinking about
easing the burden of financing health care

CLASSIFICATION OF HOSPITALS
Hospitals have been classified in many ways. Each hospital is distinct in its
characteristics as it differs in structure, functions, performance and the community it serves
the most commonly accepted criteria for the classification of the modern hospitals are.

I. Objective as Criteria
Under this classification, the main objective for which a hospital is established is
taken into consideration as some hospitals are set up with the primary motto of imparting
medication and training, while some other hospitals focus on health care.

46
 1. Teaching-cum-Research Hospitals: A Hospital to which a college is attached for
Medical/Dental/Nursing/Pharmacy Education These hospitals are mainly
established for teaching and training of medicos and promoting research activities.
Here, the provision of health care is secondary. E.g. AIIMS, Delhi; PGIMER,
Chandigarh; JIPMER, Pondichery; K.R. Hospital, Mysore; VICTORIA Hospital,
Bangalore.
2. General Hospital: The main objective of these hospitals is to provide active
medical and nursing care to the people while teaching and research are secondary
and incidental. They are permanently staffed by at least two or more medical
officers with in-patient accommodation to provide treatment for common diseases
and conditions. E.g.: District and Sub-divisional Hospitals.
3. Specialised Hospitals: These hospitals provide medical and nursing care for a
specific disease or concentrate on a particular aspect or organ of the body. E.g.:
T.B; ENT; Leprosy, Orthopaedics, Pediatrics, Cardiology, Oncology, Psychiatric,
Maternal, STD etc., (The specialised departments attached to a General Hospital
(like STD/leprosy) will not come under this category.
4. Isolation Hospitals: These are the hospitals for the care of the persons suffering
from infectious diseases requiring isolation of the patients. E.g.: Epidemic disease
hospital, Bangalore.

II. Ownership and control as criteria

1. Public Hospitals: These hospitals are run by the Central/State Governments or
Local bodies on non-commercial basis. These may be general hospitals/specialised
hospitals or both.
2. Voluntary Hospitals: These are established and incorporated under the Societies
Registration Act 1860, or public trust Act, 1882 or any other appropriate Act of

47
 Central/State Governments and being run with public & private funds on a non-
commercial basis. E.g., CMC hospital, Nellore; Krushi Trust Hospital, Vizag.
3. Private Nursing Hospitals or Nursing Home: These are generally owned and run
by an individual doctor or a group of doctors on commercial lines. Usually, patients
suffering from infirmity, advanced age, illness, injury etc., are accepted

III. Length of Stay as Criterion

1. Acute Hospitals: These hospitals provide treatment for the disease which is of
acute in nature such as pneumonia, peptic ulcer, gastroenteritis etc., usually patients
stay for short term for treatment.
2. Chronic Hospitals : These hospitals provide treatment for the disease which is of
chronic in nature such as T.B., Leprosy, Cancer, Psychosis etc., usually patients
stay ‘Long term’ in the hospital for treatment

IV. Clinical Basis as Criterion

Some hospitals are licensed as general hospitals while others as specialised hospitals.

1. General Hospitals: In a general hospital, patients are treated for all kinds of
diseases such as typhoid, fever etc.

48
 2. Specialised Hospitals: In a specialised hospital patients are treated only for that
disease for which that hospital has been set up such as Cardiac Centre, Maternity
Centres, T.B., Cancer, Ophthalmic etc.
3. Size as Criterion: As per the recommendations of Health Committee, the
following pattern for the development of hospitals to be adopted according to bed
strength.

1. Teaching Hospitals: 500 Beds (to be increased according to the No. of students)
2. District Hospitals: 200 Beds (may be raised upto 300 beds depending upon
population)
3. Taluk Hospitals: 50 Beds (may be increased depending upon the population to be
served)
4. Primary Health Centre: 6 Beds (may be raised upto 10 depending upon needs)

VI. System of Medicine as Criterion: Various systems of medicine like, Allopathy,

Ayurveda, Unami, Tibb and Homoeopathy have their own hospitals.

49
FUNCTIONS OF HOSPITALS
The following are the main functions of hospitals:

a. Investigation, Diagnosis and Care of the Sick and Injured

In modern times, the chief functions of the hospital; conduct the investigations, for
diagnosis, and provide care to the sick and injured. According to the condition of the
patient, they are examined or the necessary investigations are done of the outpatient or
inpatient.
When the condition of the patient requires a detailed investigation or due to many
other reasons, the doctor may advise the patient to stay as an inpatient. In undiagnosed

conditions – the patient may be admitted for observation only.43 For the care of the sick,
the wards are of different types. According to the age of the patient, he is admitted in a
general ward or pediatric ward.
Several other departments such as clinical laboratory, kitchen, X-Ray, pharmacy,
operation room, etc. work under the control of the administration for a common goal, the
care of the sick. So also, several categories of personnel as doctors and nurses and other
technical and non-technical persons work together in the hospital for the common goal,
care of the sick.
Functions of a Hospital

Health supervision
and prevention of
disease
Education of
Health Care
Investigation, Providers
Health Diagnosis and (Doctors,
Care care of the nurses,
sick and dietitians,
Research injured social workers,
etc.)

Rehabilitation

43
Pragna Pai. “Hospital Administration & Management”, 2007, The National Book Depot,
Mumbai, pp.4-8.

50
b. Health Supervision and Prevention of Disease
The prevention aspect of medical work has been given so much emphasis in all
aspects of medical practice, that, hospitals and health centres are involved in health
supervision and preventive therapy. In the entire outpatient department provisions are
available for the routine health examination and supervision of antenatal and postnatal
mothers, health supervision and immunisation of sick and healthy children and other
services to persons in normal conditions.
Hospitals prevent the spread of diseases by isolating the patients with
communicable disease and help to raise the standard of health in the community by health
education. Hospital staff and other medical social workers render great services in dealing
with the social problems and recurrence of psychiatric conditions and the adjustments of
such persons in the community. Different types of home care are given to patients by

community health programme.44 Modern hospitals extend their services to the community
by arranging camps and clinics such as eye camps, detection of cancer, diabetic clinics,
immunisation camps, family welfare programme camps, etc. by specialised doctors and
other health supervisors for the health supervision and prevention of diseases in the
community.

c. Education of Medical Workers

Doctors, nurses, dieticians, social workers, physical therapists, technicians, hospital
administrators and other medical and paramedical people are taught within the hospital
much of what they must learn in order to practise their profession. The theoretical part of
their learning is conducted in an affiliated institution and they practise their knowledge in
the actual situation of the hospital. Without hospitals or equivalents, it would be impossible
to give an adequate preparation for almost any type of modern medical service, because

44
Francis, C.M. Mario C. de Souza, “Hospital Administration, Jaypee Brothers Medical Publishers
(P) Ltd., New Delhi, 2000, pp.84-86.

51
such experiences are not available anywhere in the community other than a hospital or
health clinic.

d. Medical Research
Hospitals offer medical workers opportunities for investigations in the form of
laboratory facilities, trained personnel, patients and accumulated records, which are not
available elsewhere. This research is thought to be an important factor in the successful
practice of medicine and the advancement of medical science. The modern trend is to
establish a close association between the small rural hospitals, research centres and
between all hospitals and other community health organisations in order that their
personnel may have provision for an adequate research and diagnostic and therapeutic
facilities. The large number of patients and workers in these research centres and district

hospitals help promote should foster all kinds of medical research.45 The statistical side of
the research works in the hospital help to evaluate the occurrence and prevalence of
particular disease in locality or society and the health status of a country.
e. Rehabilitation
The rehabilitation in the hospital is a facility to provide additional help to recover
from an injury for stabilised patients who still need inpatient hospital care. They might
require physical, occupational or speech therapy as their injuries improve, and they might
need social work assistance to determine how to live life once they are discharged.

ASPECTS OF HOSPITAL SERVICES

The services provided in a hospital vary from one hospital to the other. Regarding
product, anything it is said that ‘anything can be offered to a market for attention,
acquisition, use or consumption includes physical objects, services, personalities, places,
organisation and ideas. On the basis of hospital typology, it is clear that different types of
hospitals offer different services to their users. Some hospitals give an over-riding priority
to the medical education, training and research where as others concentrate their attention
on medical treatment. The different aspects of hospital services are shown in Figure-I.7.

45
Goel, S.L. op. Cit., pp.26-27.

52
 Hospital Product

Medical Medical Medical Medical

Services Training Education Research

1. Line Services 2. Supportive Services 3. Auxiliary Services

a. Emergency a. Central Sterile supply a. Registration
b. Out-Patient b. Laboratory b. Records
c. In-Patient c. Radiology c. Stores
d. Intensive Care d. Nursing d. Transport
e. Diet Services e. Mortuary
e. Operation
f. Laundry f. Engineering
g. Pharmacy Services g. Security

Fig. 1.7. Aspects of Hospital Services

The above classification of product is based on different categories of hospitals. The

medical colleges and some of the medical institutes impart medical education, training and
research facilities. It is natural that concentration of product varies depending on the nature
of the hospitals. However, it is right to believe that the ultimate aim of all the providers is
to make available the best possible medical services and to prepare best medicos to
simplify the task. Here it is essential that providers should be aware of the nature,
behaviour, requirements and status of the users. This helps in planning and development of
service

1. Line Services

a. Emergency / Casualty Services: The Central Casualty department provides round the
clock central facility of emergency cases that require immediate examination, diagnosis

53
and treatment such as injuries, illness or trauma. This department is responsible for
evaluating the medical needs of patients and determining appropriate place and method
treatment. At present, emergency services are acquiring increasing importance due to
modern problems arising out of urbanisation and mechanisation.
An idea Emergency Department/ Casualty uphold the basic of medical triage
 To have right patient
 Sent to the right place
 In right time
Procedure in an emergency

Reception and Enquiry

Registration

Examination

Admission Dressing
Keeping under
Observation

Discharged i.e., Restored to

normal health or death

Chart-1.1 Procedure in an Emergency Department

b. Out-patient Services: The term “Ambulatory care” refers to the ‘care of the out-patient
services’. There has been tremendous increase in the out-patient services all over the
world during the last two decades. As such, outpatient services progressively becoming an
integral part of hospitals. All patients suffering from diseases of minor, serious, acute and
chronic nature are examined. A review of the extent of out-patient services provided by
hospitals in India makes fascinating reading. The extent of the services is gigantic and the
problems of organising them are enormous. According to currently available statistics.

54
 1. a) About 25-35 in patients are given service per bed in a year.
b) With 8,70,160 beds in the country, 2.7 to 3.0 crore inpatients are therefore
served per year.
2. a) On the other hand, for each hospital bed, about 600 out patients per year are
given service.
b) This means that over 52 crore out patients in a year are treated in the outpatient
departments of the hospitals.
A well managed outpatient services helps to build good relations with the
Community. It not only increases patients in-flow to the hospital but also results in cost
reduction. It also ensures patients as well as their relatives satisfaction. The functions of
the out-patient services are provision of diagnostic, curative, preventive and rehabilitative
services on an ambulatory basis. Out-Patient Department is the “Shop Window” of the
hospital. Hence, due care must be taken while planning this department to have enough
accommodation to avoid congestion. Supportive services like laboratories, X-ray, Injection
room, dressing room, dispensary etc., should be well connected.
Procedure of an Out-Patient Department (OPD):

Registration

Waiting and

Prescription Dressing Admission to

of Medicines Investigatio and inpatient ward &
n

X-Ray Laborator

Reports of tests

Discharg

Chart I.2. Out-patient Services

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c. In-Patient Services (Wards): A Ward is the most important part of the hospital where
sick persons are admitted for supervised treatment. It is also a modal point for research in
medicine and nursing field and training and teaching of medical, nursing and paramedical
personnel. Each ward has generally a doctor’s room, dressing room, central nursing staff
station and other essential elements needed for patient care. Ward help the patient to
recover from illness, physically, mentally and emotionally and help them to adjust to their
rehabilitation. In fact, wards serve as “home away from home” for the inpatients. The
reputation of hospital also depends upon the quality of quick and easy accessibility of
indoor services – duty doctor, nursing, X-ray, pathology, pharmacy etc.,

d. Intensive Care Unit: During the last two decades ‘Critical Care Medicine’ has
undergone rapid changes and has emerged as a discipline by itself. ‘Critical care’ has been
defined as the provision of sophisticated life support system with appropriate medication
for a wide variety of patients in a setting of close monitoring. In fact, it is a nursing unit
where intensive monitoring life support specific therapy and specialised nursing care is
provided where technical expertise and sophisticated equipment are concentrated for
critically ill-patients. The aim of ICU is to support life in a crisis, prevent life-threatening
conditions and then try to remove the cause of dysfunction by specialised treatment and
skilled nursing.

e. Operation Theatre: The operation theatre is a very complex workshop and the most
important part of surgical department. The importance of this operation theatre suit can be
realised from the fact that in a typical general hospital, surgical patients represent at least
50% of the admissions and good percentage of them have an operation performed.
Operation theatre unit is an area where a team of surgeons, anaesthesia, sterilisation room,
and scrub room. There is a trend to provide simple laboratory facility within the operation
area to serve the purpose during an emergency.

2. Supportive Services:
a) Central Sterile Supply Services: Hospital acquired infections remain a serious
problem in health care despite all the advancements in medical sciences. To combat
this, hospital must have a scientific and effective method of disinfection and

56
sterilisation. In modern hospitals this process is centralised and takes place what is
called ‘Central Sterile Supply Department’ (CSSD). From various parts of the hospital
like casualty, operation theatres, wards, out-patient clinics are soiled items are collected
in the CSSD for processing and then transported back to the end users. Thus the
purpose of CSSD is to store, sterilise, mention and issue of those instruments materials
and garments which are required to be sterilised in order to reduce the incidence of
hospital infection. But presently, the requirement of CSS services has been steadily
decreasing as the use of disposable items becomes more economical.

b) Catering and Dietary Services: The catering department in a hospital comprises

the kitchen, bulk food stores, dining room and supply of food material for the hospital.
The food provided by this department should be clean, safe, well prepared, have
nutrition or therapeutic value and attractively served. The preparation of and
distribution of food from ‘store to spoon’ has many challenges for the administrator
like proper preparation, cost accounting, pilferage and wastage. Hence, presently, in
most of the hospitals catering is being out-sourced. Hospital diet ranges from no diet,
fluid diet, normal diet, highest protein diet and special therapeutic diet. The food
should be transported in heated trolleys.

c) Services: Pharmacy is one of the extensively used therapeutic facilities of the

hospital and are of the few areas where substantial amount of money is spent on
purchases on a recurring basis. Availability of right drug at the required place during
the time of need is the key to hospital existence. Delays in supplies can be disastrous
and non-availability of required drug in time is horrifying in terms of mortality and
morbidity. Hence, there should be properly organised pharmacy department under the
management of a professionally competent and qualified pharmacist.
d) Linen and Laundry Services: The aim of the hospital Linen and Laundry Service
is to provide well-laundered and disinfected linen for all requirements of the hospital in
adequate quantities at the right place and in right time. This can be ensured with the
help of mechanical laundry system in the hospital.

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 e) Radiology / Imaging Services: Correct diagnosis of patient’s ailments is of
paramount important in order to render better and quality treatment by the doctor.
Hence, ‘Radio diagnosis’ which is presently known as ‘Imaging’ department plays a
vital role in the patient care which now incorporates:
 X-ray
 Sonography
 CT Scan
 Magnetic resonance Imaging (MRI)
 Digital Subtraction angiography (DSA)

f) Laboratory Services: Today, the practice of medicine has become diagnostic

based. As such, the physicians require more and more laboratories examinations.
Hence, laboratory services in a hospital cannot be over emphasised. Moreover, it can
be a high income generating service and an economic asset to the present day hospital.
These services can be divided into ‘three’ general areas of expertise.
(i) Clinical Pathology
(ii) Blood Bank
(iii) Pathological Anatomy
g) Nursing Services: “Doctor Cures – Nurse Cares”. Nursing, as an integral part
of the health care, encompasses the promotion of health, prevention of illness and care
of physically, mentally ill and disabled people of all ages, in all health care and other
community settings. Nursing services are managed by a matron who is assisted by the
sister-in-charge of the ward and the staff nurses nursing sisters control the ward. The
quality of nursing care and the management of nursing staff reflect the image of the
hospital.

3. Auxiliary Services:
a. Registration and Record Keeping Services: Registration is a must for a hospital
to enrol new patients with proper entry in OPD / admission cards. Medical Records
help in regulating the admission of patients. Medical record is a systematic
documentation of a patient’s personal and social date, medical history, clinical

58
 findings, investigations, diagnosis, treatment given and an account of follow up and
final out come.
b. Stores / Material Services: Materials are essential resources to achieve the
objectives of a health care organisation since medical costs vary from 30% to 40%
of the total cost. Stores are different types – Pharmacy stores, Clinical stores, Linen
stores, Surgical stores, Glassware stores, Hardware and Sanitary stores, etc. Hence,
an effective material policy is imperative in any hospitals as it ensures.
c. Transport Services: These are also very much essential for: a) carriage of supplies
from central stores department to different areas of hospital where they are needed.
b) Quick, easy and comfortable shifting of patients by trolleys / stretchers / wheel
chaired).
d. Mortuary: Each hospital should have a cold storage area to keep dead bodies
before they are being claimed by their relatives. Sometimes post mortem is needed
in medical – legal cases and unclaimed bodies should be disposed off according to
the rules.
e. Engineering and Maintenance Services: Regular repairs and maintenance of the
hospital building, furniture, fittings and other machines and equipment are essential
for the efficient functioning of the hospital. Therefore, there is a need to have a
separate Engineering and Maintenance Department to provide these services to
keep the hospital hospitable.
f. Hospital Security: Hospital security force is essential to ensure the safety of
patients, the attendants, and the staff and for valuable things. It is preferable to
appoint a security officer and other force drawn from ex-army / police service that
can have an active liaison with local police.

PRSENT STATE OF HOSPITALS IN VISAKHAPATNAM

A study on the present state hospitals in Visakhapatnam, either Government or
Corporate or Trust Based reveals that there are many problems in getting the treatment for
the patients. Certain times, the patients and their attendants are undergoing pathetic
situations and the following are the examples that show the real situation of these hospitals
in Visakhapatnam.

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1. NON-ATTENDENCE: A patient ‘X’ was admitted with abdominal pain and he
was asked to undergo ultra sound abdomen diagnostic test. When the patient
needed to be shifted to the ultra sound diagnostic unit, the staff found the ward boy
missing from his duty. By the time, the patient was shifted to the diagnostic unit,
doctor had left the unit. This caused the patient further complications due to the
non-attendance of the lower class employees.
2. LACK OF CO-ORDINATINON: Co-ordination is the essence of teamwork.
Especially in the medical set up, it is highly essential. Lack of co-ordination among
the technical and non-technical staff will lead to serious problems as the hospitals
deal with life and death situations of the patients. A patient ‘B’ (the name is not
disclosed) met with an accident and had head injury and fracture of the femur. He
was brought to GGH and admitted in the ICU. Patient was referred to
Neurosurgeon and Orthopedist. Both the doctors failed to respond to the
emergency. The patient was left unattended till the following day. Even the nurses
did not take interest to remind the doctors regarding patient’s condition and to
attend on the patient. This was merely due to lack of co-ordination among the
medical team and other hospital staff.

3. LACK OF CLARITY IN COMMUNICATOIN: The essence of communication

is getting the receiver and sender tuned together for a particular message. In
hospitals, clarity in communication is very much essential for proper
implementation of orders. If such clarity is lagging behind, the situation would be
disastrous.
The glaring example is in the month of August 2010, in paediatric
emergency department, an incident took place due to improper communication
between doctors and student nurses regarding the administration of medication. A
female child aged 6 years, who was admitted with the complaint of fever, expired.
A doctor had asked a student nurse to administer syrup chloroquine 6 ml. Instead,
the student nurse administered injection chloroquine intra venous, immediately, the
baby’s consciousness and respiratory effort decreased, which led to death of the
patient at the time of discharge. The doctor escaped from the incident and student
nurse was caught and debarred.

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4. NEGLIGENCE: If the patient is admitted in a hospital, then the hospital is obliged
to give to the patient all the benefits of its felicities and the staff has to exercise
“Reasonable Skill and Care” in looking after him. Any deviation from these norms
leading to injury, disability or death of patient would amount to negligence. The
following are the glaring reported examples for such kind of negligence in the
hospitals
In the month of April 2011, a woman was admitted with labour pains in the
Government hospital. The hospital staff did not respond properly in giving timely
treatment. After some time the concerned doctor came, performed operation and
took out the baby. But, as the operation was delayed, the mother and the baby were
died. The relatives of the patient agitated to suspend the negligent staff responsible
for their deaths.
In the moth of June 2011, a woman suffering from severe abdominal pain
was admitted in a corporate hospital (the name is not mentioned). Immediately
doctors performed an operation after that also her pain become still worst and
reached the danger stage. On taking X-ray it was found the doctors negligently left
a hand towel in the stomach and put the saucers previously also, the doctors of the
same hospital left a small pipe in a lady’s stomach and scissors in another ladies
stomach.
In a reported case happened in the month of July, 2011 a duty nurse was
suspended for her services and the other nurse was being issued a memo as they
behaved recklessly in respect of a pregnant woman and held responsible for the
death of her baby. Here are many instances with regard to inadequate nursing
supervision sometimes leading to the death of the patients in many hospitals.
Another reported case took place n the month of August 2011 when Mrs.
Jyotsna who was an M.Sc. Bio-Tech. student was admitted in a private hospital (the
name is not disclosed) with Dengue fever. In course of her treatment, she was not
given required amount of oxygen due to improper/malfunctioning of the oxygen
equipment and as a result she lost her precious life.
In another instance, in the month of September 2011, it was reported in a
prominent daily Telugu news paper that the patients of Government Mental

61
 Hospital are facing severe problem due to non-availability of even the common
medicines being used for mental ailments. Yearly, nearly 60 thousand mental
patients come to this hospital for treatment from different parts of the state and
neighbouring states and most of these patients are financially very poor also. Due
to insufficient stock of supply of these medicines the patients were asked to
purchase. The relatives of the patients don’t come forward to buy such costly
medicines for their mentally ill patients. As a result, the mental ailments of these
patients are still worsening.
5. LACK OF ATTNETION: Many times, the nurses fail to pay attention to the
prescriptions of doctors during rounds. This leads to failure in administering the
correct drug to the patients. Due to administration of wrong medications and
wrong dosage patients develop serious complications some times. Though nurses
are aware that, they need to check five Rights before they administer any
medication to the patient, namely right name, right person, right drug, right dose
and right time, they fail to do so. Here the ultimate sufferer is the patient. The
administration needs to take proper measures and disciplinary actions to avoid such
complications.
During labour pains, failure in monitoring the fetal heart rate leads to intra
uterine death of the baby. It is the duty of the doctors and nurses to monitor the
mother during labour pains for the progress of the labour. Because of heavy work
and inadequate staff the mother was not given proper attention by the doctors and
nurses that caused loss of the baby. Here it is not only the mother; but the whole
family who suffer due to the loss of baby. So recruiting adequate staff, giving
proper job responsibility and motivating about the importance of time management
should be taken care by the authority.
6. FAIL TO SCREEEN: A patient was urgently in need of blood. The attendants
were not able to provide the required blood from their own family members. The
attendants requested permission to get blood from an outside blood bank. The
blood which was purchased from outside was given to patient during surgery.
After surgery when the patient was shifted to intensive care unit it was noticed that
the patient developed anaphylactic reaction due to mismatched blood and again

62
 blood bag was sent to the lab asking to cross match with the patient’s blood. It was
identified as wrong blood group. Though the patient was saved, he had prolonged
hospitalisation. So it is needed to pay extra attention when it is fallen necessary to
get blood from an outside blood bank and need to motivate the patient’s family
members to donate blood from their own family members to avoid complications.
Due to failure to screen the blood while receiving blood from the donors there is a
possibility to develop dreaded disease like HIV, Hepatitis Band C etc. It is very
essential for the proper screening of blood before it is transfused to the patient.

7. IRRESPONSIBILITY: A lot of irresponsibility is seen in all categories of staff in

many hospitals more especially in Government hospitals. Presently, in healthcare
settings also it is found that employees give top priority to their personal matters
rather than to their bounded duties. It is observed that specialists in many hospitals
do not come in time and the patients with their ailments have to spend a long time
in waiting for such doctors. Nursing staff, para medical staff even class IV
employees immerse in talking to people either in person or over phone never
minding the call of the patients and their relatives.
Most of them are careless also while discharging their duties. This is all due
to absence of well organised administrative system in the hospitals. One of the
important reasons for why some of the hospitals in spite of having excellent
infrastructure and other facilities are unable to deliver better patient care is perhaps
irresponsibility of and insincerity of the staff. Especially in our democratic set up
people are more conscious of their rights than of duties.
8. NON AVAILABLITY OF SPECIALITST: The majority of the nursing homes,
private hospitals and trust-based hospitals face with the problem of non-availability
of specialists on the appointed time. Patients with different ailments have to wait
long hours to be examined by the concerned doctors. The researcher personally
observed that the specialist doctors, at times cancel their visits to the scheduled
hospitals at far off places even without prior intimation due to some other
engagements. A patient ‘x’ came with the complaint of fits during night. The
patient was asked to wait in the casualty. When Neuro physician was contacted he
was not available initially and refused to see the patient, since the patient has not

63
 taken a prior appointment. The doctor had left the hospital and asked the patient to
be sent to his clinic.
9. DOCTORS – TIE-UPS WITH DIAGNOSTIC CENTERS/LABs: It is also
observed that the doctors of some hospitals will maintain mutual understanding
with diagnostic centres or labs to send regularly a fixed number of patients for their
personal gain. As a result, they prescribe unnecessary tests like MRI, C.T./Ultra
Sound Scan and different lab tests even for ordinary health problems.
In the month of March 2011, it was reported in a daily newspaper that the
doctor of government hospital sending the patients to get some tests done at some
particular diagnostic centre only.
10. HIGH COST: A patient ‘B’ went to NRI hospital with a complaint of chest pain.
He was asked to undergo an angiogram. On undergoing the test he was diagnosed
with triple vessel disease and advised to undergo for a bypass surgery. Since he did
not have an insurance coverage, he was asked to pay the surgery fee in advance, by
the hospital. On enquiring of the charges in another hospital, he found it was
comparatively less. He requested the doctors to discharge him and got the treatment
where the charges were less.
This reveals that the NRI hospital is well equipped with modern
technological facilities and specialist. Since cost of the medical treatment is high
the common man is not able to afford the treatment in NRI hospital. Moreover in
case of the private nursing homes and corporate hospital, majority of the patients
are not allowed to have normal delivery of the baby. They exercise undue
influence over the patient and her relatives to undergo cigerian operation whether
it is actually required or not.

11. POOR DIETARY SERVICES: Food is the basic requirement of every living
being. Good food is an important determining factor in delighting the patients,
visitors and hospital staff. It was observed that in majority of the hospitals the diet
served is of substandard and does not serve the purpose. The rates of the food
items in the canteens of corporate and other private hospitals are too high and
attendants are unable to afford. These canteens are being run on par with hotels
lacking service motive.

64
 12. LACK OF ETHICAL VALUES: It is observed in many hospitals that some of
the staff members demand money for delivery of their services. The patients in
Government hospitals informed that some doctors demand money for doing
operation. The researcher really astonished to note that in Gyneacology ward, the
Ayahs demand Rs.500 for female baby and Rs.1000 for male baby for bathing soon
after birth. In an incident, the patient’s family could not afford to pay the
demanded money immediately resulting in the death of the baby. It is really
shameful to note that even the barber in government hospitals also demand money
for patient’s hair cut/shaving. The patients and their family members are facing
mental torture for not being able to meet such demands of Ayahs, Barbers and
Class IV employees.

The scenario presented so far paints a distressing and pathetic picture of overall
situation of the hospitals in Visakhapatnam. The ultimate goal of any hospital is patient
satisfaction which can be ensured not only by improving various hospital services
(Physician, clinical, diagnostic, therapeutic supportive and utility services) but also by
effective performance of functions of management (planning, organising, staffing,
direction and control). In view of these problems, the researcher felt that there is a need
for bringing changes in the present state of hospitals in Visakhapatnam and hence the
study.

Problems of Different Type of Hospitals

The hospitals are very complex organisations in comparison to other services
organisations like banking, hotel, tourism and insurance etc. Presently, the hospitals are at
an influx of paradigm shifts in terms of increasing dual disease burden, rapid scientific and
technological advancement in the field of medicine, deficiencies in health care
infrastructure and resources and increased consumer awareness towards quality health care.
In this context, hospitals are facing with numerous problems in course of their survival.

The researcher made an attempt to examine the various problems encountered by

hospitals especially Government, corporate and trust-based hospital.

65
I. Problems of Government Hospitals
1. Lack of Forward Planning: Planning plays a vital role in all the fields of activity .A
hospital has to face a lot of problems in the absence of forward planning. The
government hospitals are to be manned with the help of funds allotted to them by the
government which are strictly speaking, inadequate for the purpose. Here lies the
importance of planning. Further long term planning need to be given in hospital not
only to ensure development but also to derive better patient satisfaction. Most of the
patients complain that they have to wait a long time in queues in getting their turn and
there are abnormal delays in getting the laboratory test reports. These time wastes are
mainly due to faulty planning. Another glaring example relating to improper planning
is faulty design of the wards. The size of the ward is too big to ensure effective
supervision by the doctors and nursing staff. As the health care services are available at
free of cost in government hospitals, naturally, the wards are overcrowded with
patients and hence there is an acute space problem in the wards which is not properly
dealt with in their planning. Because of poor planning, the co-ordination of transport
facility is also causing more inconvenience to the patient. It is also observed that the
government hospitals whether local, district or state level are working in isolation and
lack of co-ordination in their services, the same patients are being examined again and
again resulting waste of time, efforts and resources. In this regard planned
regionalisation is suggested to eliminate such wastages.

2. Lack of Funds for Hospital Services The contribution to the public health by the
Central Government is 15 per cent, while that of state is about 85 per cent. The states
which have low revenues are unable to allocate required funds to the public health.
The average expenditure per patient per day was Rs.175 in 1986 which has now
escalated many times, mainly due to increased capital costs of construction and
equipment and other supplies, required medical care as well as salary and other
expenses. The present government hospital requires upgradation of their services,
introduction of new super- specialities to fulfil the expectations of the people it serves,
to provide quality services, as well as to stay in the highly competitive market. These
things have led to problems of raising the necessary funds and financing the medical

66
 care. Moreover most of the hospitals have not involved the community resultantly
there is a continual problem of financing.
3. Ineffective Organisation and Allocation of Work: Hospitals have experienced
difficulties in clear-cut division of work, clear job description, consequently there is
ineffective and improper utilisation of manpower. In this connection, the words in the
article by goal are worth mentioning. He stated that there are many duties which are
clerical and can be performed by non-technical personnel. Most of the nursing
personnel in the wards had 40 per cent of their work which was non- nursing. This
results in wastage of human resources.
4. Lack of Decentralisation and Effective Delegation: Another problem relating to the
poor performance of government hospitals is that there is no specific delegation of
authority. Moreover, there exists much centralisation of decision making in the hands
of high authorities. This leads to difficulties in solving various problems pertaining to
administration and patient care. In fact, decentralisation is more necessary for health
care institutions but in practice, it is found only on the paper. The same is also
supported by Singh in his article. He also opined that delegation of powers is absent in
case of medical officers.
5. Ineffective Leadership: A sound training in management sciences helps to impart
managerial abilities in the individuals which in turn leads to better decision making and
problem solving. Unfortunately, most of the administrators in government hospitals
are professional physicians who waste 60 to 70 per cent of their time in routine
administrative matters. But, effective management of hospitals requires knowledge
and competency in managerial and administrative issues. Thus most of the present
leaders in hospitals have no training in management sciences and yet are made
responsible for the management of hospitals.
6. Lack of Motivation: Motivation is the act of inspiring the people in such a way so as
to put their best efforts with willingness, zeal, and initiate towards the attainment of
organisational goals. This is one of the most challenging functions of a hospital
administrator. Unfortunately, in a number of hospitals, the staffs at various levels are
discontented and exhibit low levels of morale and motivation which is reflected in their
work. Staff with low morale and motivation may not attend the patients’ needs well

67
 and tend to cause many problems. Hence, the staff needed to be motivated by giving
financial and non-financial incentives and appreciation for their better work.
7. Stringent Controls: The stringent financial and managerial control exercised on the
hospital administrative staff by the department of health services also causes problems
in the management of health care institutions.
8. Issues of Overcrowding and Congestion in Outpatient Departments and Poor
Emergency Care: The outpatient department is the one most visited by the patient and
their relatives and where the first encounter occurs. The efficiency, the quality of its
services offered, and the courteous behaviour of the personnel and doctors working in
it are the important factors on which the image of the hospital depends. The Siddhu
Committee constituted by Government of India in 1978-79 to look into the working of
Delhi hospitals had particularly highlighted the inadequacy and poor management of
outpatients and emergency services, and stated, ‘they continue to function below the
desired level of effectiveness and efficiency and need to be strengthened substantially’.
9. Shortage of Hospital Beds: In most of the general hospital, the commonly found
problem is availability of beds for inpatients. Due to acute shortage of beds, most of
the times, the patients are kept in corridors also. It is also found that the authorities
discriminate the patients while allotting the beds.
10. Doctor-to beds and Nurse-to-beds Ratio: According to Medical Council of India, the
recommended doctor-to-bed ratio should be 1:10 in general hospitals. The ratio of 1
doctor for 10 patients will simply an in-built facility for examining 30 out-patients
approximately. Similarly, according to Indian Nursing Council, the Nurse-to-bed ration
should be 1:3. On the contrast, the doctors and nurses in general hospital are serving
the patients many times more than the recommended ratio as such many times, they
may not be able to serve to the best satisfaction of their patients.

11. Poor Doctor and Patient Relationship: Due to overcrowded outpatient department
and also the increased work load in indoor patients and additional duties given to them
in addition to patient care, the doctors are not able to give sufficient time to the
patient, they do not give empathetic listening to him or cut short his narration, do not
completely satisfy his inquiries, and thus give an impression of being less concerned
with him, even if they wish. Due to time constraint and work load, and as such the

68
 most important aspect of the doctor-patient relationship is often neglected or is
unsatisfactory specially form the viewpoint of the patients .
12. Non-Courteous Behaviour of the Staff: Mostly, poor, ignorant, illiterate masses go to
the government general hospitals for their treatment. It is clearly evident in most of
the cases that the staff on duty display discourteous behaviour towards these patients.
They hardly show real interest in the problems of their patients and sympathies their
condition. The jobs of the staff are secured in government hospital, and it is not
possible to take immediate action due to existence of strongly supporting unions. As
such, the patients and their attendants face many problems due to discourteous attitude
of the staff on duty. Hence, the staff must be trained to deal with the patients in a
soothing way, because kind words are benedictions.

II) Problems of Corporate Hospitals

The hospitals run on commercial lines with profit as their motive are called
‘corporate hospitals’. A quite revolution is taking place in hospital administration in India.
The private sector participation in health care is on the increase because of the
entrepreneurs and technocrats see immense opportunity for earning in this sector. There
are enough evidences to show that there is a willingness to pay for the services out of one’s
own savings or through organisational perquisites. It is no more an era of charity, either by
a social organisation or the government. The changing scenario of increasing demand,
variety of means to support the rendering of quality health care and the entrepreneurial
spirit have given a boom to the corporate hospitals in India. The non-resident doctors
having attracted by the avenues in Indian health care is also coming forward with huge
investment. The strong Indian economy, increasing options for health care financing,
better profitability (15% to 20% EBITA), earlier break-even (2-3 years), medical tourism,
and increased demand from within the country are the factors responsible for emergence of
corporate hospitals in the country.
Eventhough, the corporate hospitals provide high quality treatment and ensure
better patient satisfaction, yet, they too suffer with some of the following weaknesses.
1. High Cost of Treatment: The cost of treatment in corporate hospitals is relatively
high due to the following reasons:

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 a) Provision of extensive facilities and amenities like privacy, television, air
conditioners, impressive furniture and furnishings, home clothes, good food, news
papers and books etc.,
b) Costly hi-tech equipment is used in the process of treatment
c) Employ eminent medical professionals by paying attractive salaries and other
perquisites. All these things tend to increase the cost of operation and hence these
hospitals are bound to provide health services at high costs. As such, the treatment
can be afforded by only upper class and higher middle class people and it is always
beyond the reach of poor and low middle class persons.
2. Expensive Diagnostic Tests: It has been reported that at least 50 to 60 per cent
investigations which are ordered routinely in every patient are redundant. No ECG or
CT scan is necessary in patients with some kidney-stone pain, headaches. These are
done because hospital rules require it to be done. Unnecessary X-ray test and other
baseline investigations should be avoided.
3. Unnecessary Surgeries: Public openly claim that the corporate hospitals, for their
survival, go for unwanted surgeries. Removal of appendix, tonsils, uterus and some
kind of cardiac and ortho-surgeries are glaring examples. Natural delivery is not being
preferred in case of pregnant ladies. However, there is an urgent need to stop all these
nefarious practices by working out standard guidelines for treatment.
4. Heavy Debt: Heavy debt, in turn, leads to a vicious cycle of hospitals charging heftily
for diagnostic to cover the interest cost. But this may affect the frequency with which
these diagnostics are used. The outcome is that the income generated may simply not
be enough to cover the cost of loans. For instance, for a couple of years ago, a
Tamilnadu based hospital located near Chennai had to pay an interest charge Rs.14
cores when the total income was Rs.11 crores.
5. High Degree of Obsolescence: Due to ever increasing advancements in the fields of
science, technology, and medicine, hospitals are forced to replace the latest machines
and equipment to attract the patients. As a result; the existing ones are very soon
becoming obsolete leading to increased cost of operations.
6. High Degree of Turnover in Personnel: Retaining the loyalty of the medical
professionals is really a big problem in corporate hospitals as these professionals easily

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 tend to move to other hospitals where they are offered handsome salaries and
perquisites. As such, it becomes very difficult on part of the management to find
another expert, as already there is paucity of medical experts in the country.
7. Lack of Corporate Social Responsibility: Most of the corporate hospitals, with their
high profile and profit driven approach, offer a lip service in paying back their debt to
the society. Whereas, some are genuinely believe in discharging their social
responsibility to the society. For example Shri H.P. Nanda started Escorts Heart
Institute and Research centre, Sri, B.K. Modi, GM. Modi Hospitals, New Delhi.
8. Difficulties in Adoption to External Pressures: Most of the hospitals face difficulties
in adapting to external pressures such as governmental policies and changes in
economic, political, social and cultural environment etc.
9. Urban Orientation: Maximum numbers of corporate hospitals are situated in big
towns cities and metros due to easy existence of higher income groups, availability of
infrastructural facilities etc., As such, the villagers may not be able to enjoy the health
services of the corporate hospitals.
10. Lack of Continuing Medical Education and Research: Corporate hospitals do not
bother about imparting medical education and conducting research. As they are for
profit institutions by nature, they always try to extract as much work as possible from
their staff. In fact, these hospitals are the places, where top priority is to be accorded to
medical education and research in order to make staff equipped with latest know how
for carrying out their day-to-day operation with increased effectiveness. But, it is not
seen in present-day hospitals

PROBLEMS OF TRUST BASED HOSPITALS

1) Lack of Sufficient Funds for Better Hospital Services: Trust based hospitals are
service-oriented non-profit organisations and provide medical services to the
patients at subsidised costs. They generate funds from charities, donations, given
by the individual or organisations having philantrophic attitude and in some cases
with government’s aid also. They face severe financial hardships for purchasing of
sophisticated machines and equipment to provide better hospital services.
2) High Degree or Turnover and Job Dissatisfaction in Professional Staff: Due to
ineffective manpower planning, recruitment and salary policies and no scope for

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 growth and development, a high level of dissatisfaction leading to many problems
like demotivated staff, high turnover rate and high training costs etc.
3) Unqualified and Poorly Paid Staff: The medical and paramedical staff in many
trust-based hospitals is under-qualified. Since payment of salaries is very much
loss compared to other corporate and private hospitals, these hospitals unable to
attract fairly qualified personnel. For instance, many of the nursing personnel are
ANMs only and they don’t possess B.Sc. Nursing qualification. Similarly,
Homoeo and Ayurveda doctors work as resident doctors instead of Allopathic
doctors. As a result, the quality of patient care suffers.
4) Prolonged Waiting: These hospitals due to financial constraints cannot afford to
maintain specialists for various departments rather they hire these specialists (e,g.
ENT, Dentist, Neurologist, Oncologist, Gastroenterologist etc.) on specified dates
in the week to visit the hospital. The patients have to wait long hours for
consultation which causes more distress to the them.
5) Delay in Decisions: Prompt decisions cannot be taken up by the hospital
superintendent/administrator to resolve the problems with immediate attention as
they have to present the issue before the trust board for its approval, which
sometimes leads to inordinate delay in decision making affecting the quality of
hospital services.
6) Internal Conflicts: In some cases, cold war persists among the members of the
hospital trust due to ill-egos and misunderstandings. As a result, group dynamics
and a kind of unrest tend to prevail in the hospital environment, which, sometimes,
would defeat the mission of the trust.
7) Lack of Motivation: Unlike in corporate/private hospitals personnel in trust based
hospitals work with service motive even at meagre salaries but in many hospitals
their efforts will be left unrecognised by the authorities. Due to lack of motivation,
staff feel frustrated to work in such hospitals which affects the quality of care.
8) Inadequate Infrastructural Facilities: Availability of adequate water, power,
gas, transportation, etc are the important problems that sometimes stood as
obstacles for smooth running of the hospitals

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9) Problems of Hygiene and Sanitation: Trust based hospitals usually provide
Medicare at nominal or subsidised cost which attracts a large number of no income
or low income group people. Surgical operations and deliveries are done at most
affordable rates. Hence, OPD and inpatient wards are always overcrowded with
patients and their attendants resulting in congestion, poor hygiene and sanitation.
10) Misuse of Trust Funds: In the veil of rendering medical services to the
community, certain trusts collect large amounts from the foreigners and NRIs. But
in some cases, these funds are diverted or misused for certain other purposes.
There are also instances where the trust board members of the hospital collude
together and misappropriate the funds.
11) Lack of Decentralisation and Delegation of Authority: The observations on the
managerial process in trust based hospitals reveals that there is no specific
delegation of authority to the different levels. Mostly decision making power is
vested in the hands of the chairman and members of the trust. Employees’
participation in decision making process is not seen. Decentralisation which is
more necessary for healthcare organisations is found only on paper whereas
centralisation of authority prevails in practice.
12) Unscientific Management: Eventhough the hospital is recognised as industry, the
philosophy of scientific management is not being adopted in the hospitals. In this
context, the words of F.W. Taylor who has been beautifully summarised the
philosophy of scientific management are worth mentioning here: “Scientific
management” does not necessarily involve any great invention nor the discovery
of new and staring facts. It does, however, involve a certain combination of
elements which have not existed in the past, namely, old knowledge so collected,
analysed, grouped and classified into laws and rules that it constitutes science;
accompanied by a complete change in the mental attitude of the working man as
well as of those on the side of management towards each other, and towards their
respective duties and responsibilities. Also a new division of duties between the
two sides and intimate, friendly co-operation to an extent that is impossible under
the philosophy of old management. And even all of this in many cases could not
exist without the help of mechanisms which have been gradually developed

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PLAN OF STUDY

The entire study is divided into SEVEN chapters. Chapter-I deals with the Health
Care Management in India - Concept of health, National Health Policy, Health through
Five Year Plan, Health care system, expenditure and health infrastructure in India,
historical development of hospital, functions of hospitals, aspects of hospital services,
classification of hospitals, the changing structure and problems of hospitals in India, and
need for patient centred hospitals. Chapter-II deals with the review of literature, outlining
the need and importance of study, scope and objectives of the study, methodology adopted
and the presentation of the study. Chapter-III deals with Service Quality in Hospitals in
Visakhapatnam and also all the important hospital activities concerning the Seven Ps of the
Services Marketing Mix. Chapters-IV and V deal with the management of selected
hospitals along with Opinion Survey of Chief Executives, Departmental Heads, Doctors,
Nursing Staff in respect of the key management functions i.e., Planning, Organising,
Staffing, Direction and Control. Chapter-VI brings out the perceptions of out-patients and
in-patients with respect to various hospital services viz., reception services, registration
and diagnostic procedure, physician and nursing services, and physical, accommodation
and other facilities existing in the hospitals. The Last Chapter-VII is devoted to draw
inferences, leading to suggestions of the possibilities for making improvements for
effective management of the hospital and to ensure quality patient care.

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