Article

Health Care Management in India: Journal of Health Management

16(1) 133–147
Some Issues and Challenges © 2014 Indian Institute of
Health Management Research
SAGE Publications
Los Angeles, London,
New Delhi, Singapore,
Washington DC
DOI: 10.1177/0972063413518690
Mohd Iqbal Khan http://jhm.sagepub.com
Amit Banerji

Abstract
Objectives: The objective of this research is to study the developments in Indian health care sector
and will torch upon the rising demand of health care sector in India. The study will evolve the concept
of globalization, development of information technology, medical tourism, role of urbanization, growth
of health care insurance sector, affordability of health care in India and the role played by major private
health care firms in India.
Study design: Descriptive design.
Methods: Data used here is secondary data, and collection of data is done from different health care
surveys in India, health care websites, journals, newspapers, health magazines and conferences.
Results: Rising demand of health care in India. India is one among the leading developing countries in
health care as the demand of this sector is expected to reach US$ 100 billion by 2015 from the current
US$ 65 billion, growing at around 20 per cent a year, according to rating agency Fitch, and the major fac-
tors driving the growth in the sector include increasing population, growing lifestyle related health issues,
cheaper costs for treatment, thrust in medical tourism, improving health insurance penetration, increasing
disposable income, government initiatives and focus on Public–Private Partnership (PPP) models.
Conclusion: With rising health care demand in India, private sector hospitals and health care firms
started to come with the concept of Corporate Social Responsibility (CSR) by giving subsidized rates
and rural coverage concepts in India, so that the poor people can afford for the necessary treatment,
as 32.7 per cent of the total Indian people fall below the international poverty line of US$ 1.25 per day
(PPP) while 68.7 per cent live on less than US$ 2 per day (www.wikipedia.org).
Oxford Poverty and Human Development Initiative (OPHI) stated in 2010, that eight Indian states have
more poor people than 26 poorest African nations combined which totals to more than 410 million poor
in the poorest African countries.

Keywords
health, challenges, technology, globalization, urbanization

Mohd Iqbal Khan, is a research scholar at Chakravarti Rajgopalachari Institute of Management, Barkatullah
University, Bhopal. Email: ikhan707@gmail.com
Amit Banerji, is an Associate Professor in the department of Management Studies, Maulana Azad National
Institute of Technology, Bhopal. Email: amitbanerji123@gmail.com

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

134 Mohd Iqbal Khan and Amit Banerji

Introduction
‘Health is Wealth’, this word is being used as a common lingual concept from ages, but the present sce-
nario of life has made it an alarming concept in human minds even though it was a old one, but is a needy
one in today’s changing environmental scenario. It is also fully promoted among the people of India with
a different terminology within different regional sects of India.
Health is the level of functional or metabolic efficiency of a living being. In humans, it is the general
condition of a person’s mind and body, usually meaning to be free from illness, injury or pain (as in
‘good health’ or ‘healthy’).
World Health Organization (WHO) was defined Health as a state of complete physical, mental and
social well-being and not merely absence of disease or infirmity. But after four decades, it redefined
health as a resource for everyday life, not the objective of living by emphasizing social and personal
reasons as well as physical capacities (www.wikipedia.org).
According to the World Health Organization, the main determinants of health include the social and
economic environment, the physical environment, and the person’s individual characteristics and behav-
iours (WHO 2011).
More specifically, key factors that have been found to influence whether people are healthy or
unhealthy include (Lalonde 1974; Public Health Agency of Canada 2011).
Health care in India features a universal health care system run by the constituent states and territo-
ries of India. The Constitution charges every state with ‘raising the level of nutrition and the standard

Personal health practices

Income and social status
and coping skills

Social support networks Healthy child development

Education and literacy Biology and genetics

Employment/working
Health care services
conditions

Social environments Gender

Physical environments Culture

Figure 1

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Health Care Management in India 135

of living of its people and the improvement of public health as among its primary duties’. The National
Health Policy was endorsed by the Parliament of India in 1983 and updated in 2002 (Kishore 2005).
Parallel to the public health sector, and indeed more popular than it, is the private medical sector in
India. Both urban and rural Indian household tend to use private medical sector more frequently than
public sector, as reflected in surveys (International Institute for Population Sciences and Macro
International 2007).
India’s Public Health System has been developed over the years as a three-tier system, namely pri-
mary, secondary and tertiary level of health care. This three-tier Public Health Infrastructure, comprising
Community Health Centres, Primary Health Centres and Sub-Centres across rural and semi-urban areas
and multi-speciality hospitals and medical colleges located at urban areas. The National Health Policy-
2002 aims at achieving an acceptable standard health for general population of the country and it was
reflected as the main objective in 11th Five Year Plan (Annual Report 2008–09, Ministry of Health and
Family Welfare).
‘Life is not mere living but living in health’ with this words, the Honourable Mrs. Indira Gandhi the
Prime Minister of India, opened her address on 6th May 1981 to the 34th World Health Assembly, meet-
ing 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 (Mogli 1983).
To improve health care in India by 2022, the main objective of 12th Five Year Plan as recom-
mended by McKinsey & Company (a global management consulting firm) recommended public–
private partnership route in India. The report was released by Union Health Minister Ghulam Nabi
Azad on December 18–19, 2012 on 9th Indian Health Care Summit. He said that while public health
systems must be strengthened at all levels, health care needs to be supplemented through private sector
participation (Sharma 2012).
The Indian health care sector is expected to reach US$ 100 billion by 2015 from the current US$ 65
billion, growing at around 20 per cent a year, according to rating agency Fitch. Some of the major factors
driving the growth in the sector include increasing population, growing lifestyle related health issues,
cheaper costs for treatment, thrust in medical tourism, improving health insurance penetration, increas-
ing disposable income, government initiatives and focus on Public–Private Partnership (PPP) models
Indian pharmaceutical market is also set to witness medium-term growth. The sector is expected to
grow at 15.3 per cent from 2011–12 to 2013–14, according to a Barclays Capital Equity Research report
on India Health Care & Pharmaceuticals (Healthcare in India 2012).
Government of India has decided to increase health expenditure to 2.5 per cent of gross domestic
product (GDP) by the end of the Twelfth Five Year Plan (2012–17), from the existing 1.4 per cent. Prime
Minister, Dr. Manmohan Singh also emphasized the need for increased outlay to health sector during the
Twelfth Five Year Plan (Consolidated FDI Policy).
This demand for health care is drifting both public sector and corporate India to put efforts to meet the
demand by expanding their business horizons and to grab the market (Emerging Market Report-2007,
Price Water House Coopers). This scenario attracted Foreign Direct Investments (FDI) and also leading
to Mergers & Acquisitions in Health Care Sector that pulled the competitors to different directions
(Chandra).
The hospital and diagnostic centre in India has attracted foreign direct investment (FDI) worth US$
1.34 billion, while drugs and pharmaceutical and medical and surgical appliances industry registered
FDI worth US$ 9.19 billion and US$ 521.45 million respectively during April 2000 to March 2012,

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

136 Mohd Iqbal Khan and Amit Banerji

according to the data provided by Department of Industrial Policy & Promotion (DIPP) (Indian Mirror
2012).
Indian health care sector could generate more than 40 million new Jobs revenues by 2020, according
to the Report 2020.’ Realizing the magnitude of this opportunity, private health care players, domestic
and international, are revving up their investment plans. For example, Fortis Healthcare recently
announced the launch of two more hospitals, one in Hyderabad and the other in Agra, taking its hospital
network count to 68. Fortis also acquired its sister firm, Singapore-based arm Fortis Healthcare
International as part of its plan to consolidate domestic and international operations. Fortis commis-
sioned its first hospital in 2001 at Mohali and has expanded its operations to become a pan-India network
with 4,000 operational beds (Narsalay, Kapur, Coffey, Sen and Mathur 2012).
The Indian government plans to increase spending on low-cost health care from 1.3 per cent to 2.5 per
cent of GDP during the 12th Five Year Plan (2012–17) period. This spending will cover the building of
more health care facilities and hospitals as well as the setting up of more medical colleges and nurse
training institutes. Vaatsalya, India’s first hospital network focused exclusively on India’s tier two and
three towns, recently raised an additional network in 2012. Additionally, Fortis Healthcare plans to set
up a second brand of hospitals aimed at smaller towns and cities, with a target of 25 hospitals in three
years. The company is also launching a nationwide Mother and Child programme for the poor under the
aegis of the Fortis Foundation (The Hindu 2012).

The Healthcare Sector includes

Hospital Management
Firms

Health Maintenance
Organizations

Biotechnology

Alternative Medicine
Naturopathy, Herbalism,
Ayurveda, Meditation, Yoga,

Hypnosis, Homeopathy

Figure 2
Source: International Institute for Population Sciences and Macro International 2007.

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Health Care Management in India 137

Health Care Issues in India

Malnutrition
Malnutrition is the condition that results from taking an unbalanced diet in which certain nutrients are
lacking, in excess (too high an intake), or in the wrong proportions (Rieff 2009). Forty-two per cent of
India’s children below the age of three are malnourished, which is greater than the statistics of sub-
Saharan African region of 28 per cent. Although India’s economy grew 50 per cent from 2001–06, its
child-malnutrition rate only dropped 1 per cent, lagging behind countries of similar growth rate.
Malnutrition impedes the social and cognitive development of a child, reducing his educational
attainment and income as an adult (Robinson 2008). These irreversible damages result in lower
productivity.

Diseases
A disease is an abnormal condition affecting the body of an organism. It is often construed to be a medi-
cal condition associated with specific symptoms and signs (Disease, Dorland’s Medical Dictionary). It
may be caused by factors originally from an external source, such as infectious disease, or it may be
caused by internal dysfunctions, such as autoimmune diseases. In humans, ‘disease’ is often used
more broadly to refer to any condition that causes pain, dysfunction, distress, social problems, or
death to the person afflicted or similar problems for those in contact with the person.
Diseases such as dengue fever, hepatitis, tuberculosis, malaria and pneumonia continue to plague
India due to increased resistance to drugs (Dengue, Centers for Disease Control and Prevention US
2011). And in 2011, India developed a Totally drug-resistant form of tuberculosis (Goldwert 2012). India
is ranked 3rd among the countries with the most HIV-infected (HIV/AIDS, UNICEF India 2011).
Diarrhoeal diseases are the primary causes of early childhood mortality (Life Expectancy and Mortality
in India, The Prajnopaya Foundation 2011). These diseases can be attributed to poor sanitation and inad-
equate safe drinking water in India (Health Conditions, US Library of Congress 2011).
However, in 2012 India was polio free for the first time in its history (India marks one year since last
polio case, Al Jazeera 2012). This was achieved because of Pulse Polio Programme was started in
1995–96 by Government of India (http://india.gov.in/spotlight/spotlight_archive.php?id=90).
Indians are also particularly at high risk for atherosclerosis and coronary artery disease. This may be
attributed to a genetic predisposition to metabolic syndrome and changes in coronary artery vasodilatation.
NGOs such as the Indian Heart Foundation and the Medwin Foundation have been created to raise
awareness about this public health issue (Heart Disease is preventable, Indian Heart Foundation 2012;
Preventindia.org 2012).

High Infant Mortality Rate

Infant mortality occurs when a child dies after birth. Childhood mortality is the death of a child before
their fifth birthday.

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

138 Mohd Iqbal Khan and Amit Banerji

Approximately 1.72 million children die each year before turning one (Sharma). The under-five mor-
tality and infant mortality rates have been declining, from 202 and 190 deaths per thousand live births
respectively in 1970 to 64 and 50 deaths per thousand live births in 2009 (Maternal & Child Mortality
and Total Fertility Rates 2012). However, this rate of decline is slowing. Reduced funding for immuniza-
tion leaves only 43.5 per cent of the young fully immunized. A study conducted by the Future Health
Systems Consortium in Murshidabad, West Bengal indicates that barriers to immunization coverage are
adverse geographic location, absent or inadequately trained health workers and low perceived need for
immunization (Kanjilal et al. 2008). Infrastructure like hospitals, roads, water and sanitation are lacking
in rural areas (Medical and Healthcare Facility Plagued 2011). Shortages of health care providers, poor
intra-partum and newborn care, diarrhoeal diseases and acute respiratory infections also contribute to the
high infant mortality rate.

Poor Sanitation
Sanitation is the hygienic means of promoting health through prevention of human contact with the
hazards of wastes. Hazards can be physical, microbiological, biological or chemical agents of disease.
The World Health Organization states that: ‘Sanitation generally refers to the provision of facilities
and services for the safe disposal of human urine and faeces. Inadequate sanitation is a major cause of
disease world-wide and improving sanitation is known to have a significant beneficial impact on
health both in households and across communities. The word ‘sanitation’ also refers to the mainte-
nance of hygienic conditions, through services such as garbage collection and wastewater disposal
(Kishore 2005).
As more than 122 million households have no toilets, and 33 per cent lack access to latrines; over
50 per cent of the population (638 million) defecates in the open (Water, Environment and Sanitation,
UNICEF India 2011). This is relatively higher than Bangladesh and Brazil (7 per cent) and China (4
per cent). Although 211 million people gained access to improved sanitation from 1990–2008, only 31
per cent uses them. Eleven per cent of the Indian rural families dispose of stools safely whereas 80 per
cent of the population leave their stools in the open or throw them in the garbage (Water, Environment
and Sanitation, UNICEF India 2011). Open air defecation leads to the spread of diseases and malnutri-
tion through parasitic and bacterial infections (Initiatives: Hygiene and Sanitation, Sangam Unity in
Action 2011).

Inadequate Safe Drinking Water

Drinking water or potable water is water safe enough to be consumed by humans or used with low risk
of immediate or long term harm. Access to protected sources of drinking water has improved from 68 per
cent of the population in 1990 to 88 per cent in 2008 (Water, Environment and Sanitation, UNICEF India
2011). However, only 26 per cent of the slum population has access to safe drinking water and 25 per
cent of the total population has drinking water on their premises. This problem is exacerbated by falling
levels of groundwater caused mainly by increasing extraction for irrigation. Insufficient maintenance of
the environment around water sources, groundwater pollution, excessive arsenic and fluoride in drinking
water pose a major threat to India’s health.

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Health Care Management in India 139

Rural Health
In medicine, rural health or rural medicine is the interdisciplinary study of health and health care delivery
in the context of a rural environment or location. Some of the fields of study comprising rural health
include: health, geography, midwifery, nursing, sociology, economics and telehealth/telemedicine.
Rural India contains over 68 per cent of India’s total population with half of it living below poverty
line, struggling for better and easy access to health care and services (Indiafacts.in). Health issues con-
fronted by rural people are diverse and many—from severe malaria to uncontrolled diabetes, from a
badly infected wound to cancer (Jssbilaspur.org). Post-partum maternal morbidity is a serious problem
in resource-poor settings and contributes to maternal mortality, particularly in rural India (Sutherland
and Bishai 2008). A study conducted in 2009, found that 43.9 per cent of mothers reported to have expe-
rienced post-partum morbidities six weeks after delivery (Tuddenham, Rahman, Singh, Barman and
Kanjilal 2010). Rural medical practitioners are highly sought after by people living in rural India as they
more financially affordable and geographically accessible than practitioners working in the formal pub-
lic health care sector (Kanjilal 2007).
Female Health Issues:

1. Malnutrition: According to tradition in India, women requires to eat last, even during pregnancy
and lactating period, which is the main cause of female malnutrition (Chronic hunger and the sta-
tus of women in India).
2. Breast Cancer: One of the most growing problems among women causing an increased number of
mortality rates in India.
3. Stroke
4. Polycystic ovarian disease (PCOD): PCOD is another issue causing increase in infertility rate in
females. It is a condition in which there are many small cysts in the ovaries, which can affect a
woman’s ability to conceive.
5. Maternal Mortality: Indian maternal mortality rates in rural areas are highest amongst the
world.

Globalization in India
Liberalization, Privatization and Globalization (LPG) has its impact on people in India and has resulted
in better image of India to foreign nationals. The term globalization means international integration. It
includes an array of social, political and economic changes. Unimaginable progress in modes of com-
munications, transportation and computer technology, and have given the process a new lease of life.
The image of India among the foreign nations has changed from a ‘poor country’ to an advanced
‘knowledge hub’.
The main factors for such a dramatic change are:

1. Rise in Information Technology (IT), changing the face of India,

2. Innovation in businesses,
3. Intuitiveness in controlling the economy, irrespective of political changes in the government,

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

140 Mohd Iqbal Khan and Amit Banerji

4. Inquisitiveness among people due to the free environment created by implementing the freedom
by all means approved as per Indian Constitution,
5. Inherent intelligence among the people because of the traditional culture and heritage of the
country (ayush.ilnu 2012).

Rise in Information Technology (IT), Changing Face of India

Today Indians are dictating terms to global IT industry. NRI venture capitalists are well established in
the Silicon Valley. IT firms like TCS, INFOSYS and WIPRO are global brands. There is a huge demand
for skilled Indian IT professionals. This is natural for our country because we gifted the game of Chess
and the concept of Zero to the world (Sawant 2006).
The Information technology industry in India has gained a brand identity as a knowledge economy
due to its IT and ITES sector. The IT–ITES industry has two major components: IT services and business
process outsourcing (BPO). The growth in the service sector in India has been led by the IT–ITES sector,
contributing substantially to increase in GDP, employment and exports. The sector has increased its
contribution to India’s GDP from 1.2 per cent in FY1998 to 7.5 per cent in FY2012 (Indian IT-BPO
Industry). According to NASSCOM, the IT–BPO sector in India aggregated revenues of US$100
billion in FY2012, where export and domestic revenue stood at US$69.1 billion and US$31.7 billion
respectively, growing by over 9 per cent. The major cities that account for about nearly 90 per cent of
this sectors exports are Bangalore, Chennai, Delhi, Mumbai, Hyderabad, Pune, Kolkata (The Indian
IT Sector Analysis 2013).
This sector has also led to massive employment generation. The industry continues to be a net employ-
ment generator—expected to add 230,000 jobs in FY2012, thus providing direct employment to about
2.8 million, and indirectly employing 8.9 million people (Indian IT-BPO Industry).
This concept of using sophisticated Informational technology and penetration of IT usage made India
a global business unit and made online business as the order of the day. IT became a backbone to all
businesses and used as a cost-cutting strategy in order to withstand the competition. IT sector created
employment opportunities and forced the Educational sector to meet the demand by adopting new
curriculum.
Sustaining global economic development will demand a substantial shift in the role of industry by
bringing innovation to drive sustainability and profit. India’s rapid emergence as a global economic
player is being propelled in large substance by its business and industry sector, which is increasingly
contributing innovative solutions for integration of development and environmental sustainability.
Because of innovativeness by the Indian Entrepreneurs, new products are coming into the market.
Indian businessmen are competing with foreigners by entering into global bidding and acquiring foreign
markets. Indian business companies are listed in foreign stock markets and doing a very good business.
‘Made in India’ became a serious business perspective.
India is one of the Democratic countries in the world where political changes will affect the Economy.
This can be understood from the liberalization policies undertaken by the government of P. V. Narasimha
Rao and his finance minister Manmohan Singh (currently the Prime Minister of India) started breakthrough
reforms and the fruits of liberalization reached their peak in 2007, when India recorded its highest GDP
growth rate of 9 per cent (https://www.cia.gov/library/publications/the-world-factbook/geos/in.html#Econ).

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Health Care Management in India 141

With this, India became the second fastest growing major economy in the world, next only to China Even
though world economies were collapsed, India was able to withstand during the recent global financial
crisis and enjoyed a GDP growth averaging 8.7 per cent during 2004–08 and 7.8 per cent during 2009–11.
The intuitiveness in controlling the economy saved our skin in spite of lot of uncertainties in Indian poli-
tics and this is because of its conservative attitude that was inherent (Phd chamber of commerce and
Industry 2011).
Inquisitiveness among people made India to be in the global market in different sectors be it space
research or be it biotechnology. Inquisitiveness comes only when the free environment is created and it
is because in India we respect the Constitutional Rights. One can notice that in any country where
Constitutional Rights were not respected, the growth was not significant.
Even though we give credit to fertilizers and manures used, when productivity of a crop is high, but
basically it may be due the fertility of the land. Similarly, the people in India have shown their inherent
intelligence in various fields of development and made the country to be proud of them. This is because
of the traditional culture and heritage of the country makes people to follow good practices in life which
leads to a peaceful life.

The Role of Urbanization

Population residing in urban area, according to 1901 census, was 11.4 per cent (Singh 1978). This count
increased to 28.53 per cent according to 2001 census, and crossing 30 per cent as per 2011 census, stand-
ing at 31.16 per cent (Business Standard 2012; Datta 2012). According to a survey by UN State of the
World Population report in 2007, by 2030, 40.76 per cent of the country’s population is expected to
reside in urban areas (Urbanisation in India faster than rest of the world, Hindustan Times 2007).
Urbanization made India to shift its focus from agricultural sector to manufacturing sector and now to
service sector. When we opened our economy, we invited not only the international businesses but also
the issues related to them. People enjoyed when the job market was open due to outsourcing business but
people were realized later how it affected the lifestyles of them. Society has shifted from single-earning
member to duo-earning members and this had a positive impact in changing their economic status from
lower middle class to upper middle class but has a negative impact on personal front as they may be
unable to adjust to work–life balance. As people are unable to find time for direct social interaction,
online social networks became popular.
The change in the lifestyles brought new health problems to the people in India. The fast food indus-
try in India has evolved with the changing lifestyles of the young Indian population (Hubacek, Guan
and Barua 2007). The sheer variety of gastronomic preferences across the regions, hereditary or
acquired, has brought about different modules across the country. Several international fast food chains
like Kentucky Fried Chicken, McDonald’s, Cafe Coffee Day and Barista Coffee; fast food centres
became more popular as people unable to find time for their own preparations. Work pressure on
employees has increased due to the competition in businesses. Hypertension, heart diseases, obesity
became common even among the young people due to the stressful office activities (Kulkarni 2012).
Buying power of people has increased due to plastic currency (credit cards) usage and flexible EMIs for
bank loans. Traffic congestions increased due to increase in vehicle frequency but the road conditions
are not improved in the same pace. Pollution levels have increased in each city and other diseases due

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

142 Mohd Iqbal Khan and Amit Banerji

to pollution increasing. The civic authorities are not able to manage the local governments due to the
rapid growth due to urbanization. This made the governments to work not in an isolated way but by
networking with private sector and NGOs with the concept of Public–Private Partnership (PPP).
Health care became an emerging sector and is making a good business in the market. The aware-
ness regarding health care among the people has increased. In fact, the health care businesses made it
by creating awareness. To overcome from the problems related to change in lifestyle, alternative
medicines become more popular and this may be a kind of blessing in disguise. Morning joggers,
Gym visitors, Yoga followers, Ayush Care Centres, Body slimming centres became the order of the
day. This scenario attracted a good business in Health care sector and private sector taken the oppor-
tunity and grabbed the market. This made some foreign agencies to look at India and entering in
Indian markets by Foreign Direct Investments (FDIs) and also grabbing the Indian businesses by
Mergers & Acquisitions.

Development of Science
The development of science has a role even in health care sector from drug discovery to delivery. The
R&D labs are in collaboration with foreign companies and introduced new technology, modern instru-
ments and new drugs. Haffkine Institute (India’s one of the oldest institute established in 1899) could
produce some vaccines in 1947. Today India is engaged in developing recombinant and edible vaccines.
Pharma companies like Reddy’s, Cipla and Ranbaxy are giving the global pharma majors, a run for their
money (www.in.kpmg.com/pdf/Indian%20pharma%20outlook.pdf.). A few small drug companies were
producing a minor range of ayurvedic and herbal medicines in 1947. Today India is competing with
China in marketing herbal drugs. Interesting point is that two decades back, may be due to lack of aware-
ness, people used to suffer with diseases like tuberculosis (TB), leprosy, cancer, etc. but today due to
increase in awareness, we are able to identify diseases AIDS, H1N1 virus, breast cancer, prostate cancer,
superbug, etc.

Affect of Global Warming

Everybody experiences the affect of global warming directly or indirectly. One side the average life span
has increased due to good health practices and but due to natural calamities in terms of floods, earth-
quakes, etc, heavy losses to human life is happening. If natural calamities are God created in one side,
the level of these activities are intensified due to man-made issues like cutting the greenery, construction
activities without proper care, misuse of natural resources, etc. An example to consider is that average
temperatures have climbed 1.4 degrees Fahrenheit (0.8 degree Celsius) around the world since 1880,
much of this in recent decades, according to NASA’s Goddard Institute for Space Studies (http://news.
nationalgeographic.co.in/news/2004/12/1206_041206_global_warming.html). The rate of warming is
increasing. The twentieth century’s last two decades were the hottest in 400 years and possibly the warm-
est for several millennia, according to a number of climate studies. And the United Nations’
Intergovernmental Panel on Climate Change (IPCC) reports that 11 of the past 12 years are among the
dozen warmest since 1850.

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Health Care Management in India 143

Medical Tourism
Medical tourism is a growing sector in India. India’s medical tourism sector is expected to experience an
annual growth rate of 30 per cent, making it a $2 billion industry by 2015 (Hamid 2012; Indian Medical
Tourism To Touch `9,500 Crore By 2015, IndianHealthCare.in). As medical treatment costs in the devel-
oped world balloon—with the United States leading the way—more and more Westerners are finding the
prospect of international travel for medical care increasingly appealing. An estimated, 150,000 of these
travel to India for low-priced health care procedures every year (Swamis to Surgeries, medicaltourism-
mag.com). Advantages for medical tourists include reduced costs, the availability of latest medical tech-
nologies (Reason to smile, The Hindu 2011) and a growing compliance on international quality standards,
as well as the fact that foreigners are less likely to face a language barrier in India. Most estimates claim
treatment costs in India start at around a tenth of the price of comparable treatment in America or Britain
(Indian medical care goes global, Aljazeera.Net 2006; Goering). The most popular treatments sought in
India by medical tourists are alternative medicine, bone-marrow transplant, cardiac bypass, eye surgery
and hip replacement. India is known in particular for heart surgery, hip resurfacing and other areas of
advanced medicine.
The city of Chennai has been termed ‘India’s health capital’(Chennai High: City gets most foreign
tourists, The Times of India 2010; National Accreditation Board for Hospitals & Healthcare Providers
2012; சென்னை இந்தியாவின் மருத்துவ தலைநகரா?, BBC Tamil 2012) Multi- and
super-specialty hospitals across the city bring in an estimated 150 international patients every day.
Chennai attracts about 45 per cent of health tourists from abroad arriving in the country and 30 to 40 per
cent of domestic health tourists (National Accreditation Board for Hospitals & Healthcare Providers
2012). Factors behind the tourists’ inflow in the city include low costs, little-to-no waiting period.
The main reasons are good branding with trust, availability of medical experts, low cost involved in
the process, people-friendly environment in the country and technology usage, etc (Report by India
Brand Equity Foundation 2010).

Health Insurance
Health insurance has historically played a pivotal role in improving access to health care around the
world. Unfortunately, less than 15 per cent of the Indian population is covered under some form of health
insurance, including government-supported schemes. Only around 2.2 per cent of the population is cov-
ered under private health insurance, of which rural health insurance penetration is less than 10 per cent.
Although health care insurance in India is currently under-penetrated, it is expected to grow at a
CAGR of 15 per cent till 2015. At the current rate of growth only 50 per cent of India’s population
would have health insurance coverage by 2033. The rising level of middle-class incomes in India has
led to the emergence of lifestyle-related diseases. Along with inflationary health care costs, this has
triggered the demand for health insurance. Given the diversity of India’s population and its limited
purchasing power, innovative insurance products at multiple price points are needed to penetrate this
huge market (PWC 2011).
The Indian Health Insurance market has emerged as a new and lucrative growth avenue for both exist-
ing players as well as new entrants. Governments are encouraging the insurance players and so many

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

144 Mohd Iqbal Khan and Amit Banerji

schemes have come in the market. Governments have realized that it is much better for them to offer
health care insurance rather than health care services through hospitals. Governments have introduced
several health care schemes to poor people so that they will be getting the same corporate treatment for
the diseases. The central government has established Insurance Regulatory and Development Authority
(IRDA) which is a statutory body to for the regulation of whole industry (Health Insurance in India –
Opportunities, Challenges and Concerns, IIM-Ahmedabad 2000).

Affordability of Health Care

The basic issue is now on the cost of the health care. Delivering affordable health care to India’s
billion-plus people presents enormous challenges and opportunities for the medical community, insurers
and other service providers. Innovative technologies, processes and partnerships forged by the Indian
government and private companies have begun bridging the health care gap. Advances are underway
on several fronts, from expanding health insurance coverage for the poor and building hospitals in
smaller towns, to using technology for safer drinking water and improving treatment outcomes,
according to participants in the panel titled, ‘Health Care in India: An Evolving Market for Founders
and Investors’. Examples of progress offered by the panellists included heart surgeries in India that
cost less than a tenth of what they would in the United States; and health insurance that costs less than
a dollar for an entire family, thanks to technology, talent and creative government programmes. The
programme, called Rashtriya Swasthya Bima Yojana (or national health insurance programme), was
launched in late 2007, and has so far enrolled nearly 15 million families, and 4,384 hospitals, in 26 of
India’s 28 states. India has about 83 million poor families who make up about 37 per cent of its popu-
lation, according to the government’s Planning Commission (India Knowledge 2010). ICICI Lombard
is enrolling about 2,000 families each day, and controls about 45 per cent of the low-income market,
according to Dasgupta. ‘Private insurance companies bid for (providing coverage in) districts each
year, and it is their responsibility to enrol families and ensure that a network of providers is set up.
India’s Tata Group is working on health solutions from the ground up, bringing technology to provide
clean drinking water, according to panellist Homi Khusrokhan, an advisor to the Tata HBM Health
Care Fund, which supports innovative enterprises. An innovation centre at Tata Chemicals recently
launched what Khusrokhan called ‘a water filter appropriate for the needs of the country’. The tech-
nology uses burnt rice husks with nano-silver as a filter for water, making it 99.8 per cent free of
harmful bacteria and also some viruses. ‘Burnt rice husk is available in huge quantities in India and
used as a fuel’, Khusrokhan noted. Indian families are also acquainted with the cleansing properties of
silver; many households drink water from silver glasses, and eat food on silver plates. We are able get
the required health care service from various players at par with a 5-star hotel. Corporate hospitals
have not only raised the bar for health care in India, but also eased the pressure off government hos-
pitals dealing with tertiary care. Waiting time for the patients has come down to almost zero in these
private hospitals. The rise in costs is because of modern technology. The checks before an operation
increase the safety in operation and it comes with some price. This ensures the quality in operations
and people are willing to pay more for such quality. Hospitals are maintaining the quality standards
like NABH/NABL in order to meet the competition (Innovating around India’s healthcare Challenges,
India Knowledge@Wharton 2010).

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Health Care Management in India 145

Conclusion
Private sector hospitals are also started to come with the concept of Corporate Social Responsibility
(CSR) by giving more subsidized rates so that the poor people can afford for the necessary treatment.
IRDA should focus on (i) checking the costs of medical care and (ii) developing a mechanism to check
whether private insurance companies are providing same facilities to all categories like rich, upper-
middle class, lower-middle class and the poor by encouraging NGOs and Cooperatives to enter into
Insurance business.

Acknowledgement
The author would like to express a very deep sense of thanks to Dr Vivek Sharma Director Department of Management
Studies (CRIM), Barkatullah University Bhopal for giving the necessary instructions regarding the article.

References
Annual Report 2008–09, Ministry of Health and Family Welfare, Government of India.
ayush.ilnu (2012). Globalization and its impact on Indian Economy: Developments and challenges. Available at
http://legalservicesindia.com/article/article/globalization-&-its-impact-on-indian-economy-developments-and-
challenges-1018-1.html. Accessed on January 2, 2013.
Business Standard (2012). Victims of urbanisation: India, Indonesia and China. Available at Rediff.com. Accessed
on June 15, 2012.
Chennai High: City gets most foreign tourists. The Times of India, August 27, 2010. Accessed on September 11,
2012.
Chronic hunger and the status of women in India.
Consolidated FDI Policy, DIPP.
Datta, Pranati. Urbanisation in India (PDF). Available at Infostat.sk. Accessed on June 13, 2012.
Dengue, Centers for Disease Control and Prevention US. Accessed on September 20, 2011.
Disease, Dorland’s Medical Dictionary.
Emerging Market Report (2007), Healthcare in India, Price Water House Coopers.
Global Warming Fast Facts (2007). Available at http://news.nationalgeographic.co.in/news/2004/12/1206_041206_
global_warming.html.
Goldwert, Lindsay. (2012). ‘Totally drug-resistant’ tuberculosis reported in India” 12 patients have not responded to
TB medication. New York Daily News. Accessed on January 16, 2012.
Hamid, Zubeda (2012). The medical capital’s place in history. The Hindu Accessed on September 15, 2012.
Healthcare in India (2012). OIFC: NRIs investment opportunities in healthcare industry of India. Available at http://
www.oifc.in/sectors/healthcare. Accessed on January 4, 2012 from
Health Conditions, US Library of Congress. Accessed on September 20, 2011.
Health Insurance in India – Opportunities, Challenges and Concerns (2000) IIM-Ahmedabad.
Heart disease is preventable, Indian Heart Foundation. Accessed on July 17, 2012.
HIV/AIDS, UNICEF India. Accessed on September 9, 2011.
Hubacek, K., D. Guan & A. Barua (2007). Changing lifestyles and consumption patterns in developing countries: A
scenario analysis for China and India. Futures, 39(9), 1084–96.
http://india.gov.in/spotlight/spotlight_archive.php?id=90
https://www.cia.gov/library/publications/the-world-factbook/geos/in.html#Econ
India Knowledge (2010). Innovating around India’s health care challenges. Available at http://knowledge.wharton.
upenn.edu/india/article.cfm?articleid=4501. Accessed on January 3, 2012.
Indiafacts.in. Urban rural population of India. Accessed on July 17, 2012.

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

146 Mohd Iqbal Khan and Amit Banerji

India marks one year since last polio case, Al Jazeera. Accessed on January 13, 2012.
Indian medical care goes global. (2006). Aljazeera.Net, Accessed on Nov 11, 2006.
Indian Medical Tourism to Touch `9,500 Crore by 2015. The Economic Times, posted on IndianHealthCare.in.
Indian Mirror (2012). Indian health industry at a glance in 2011–2012. Available at from http://www.indianmirror.
com/indian-industries/2012/health-2012.html. Accessed on January 2, 2011.
Indian IT-BPO Industry.
Initiatives: Hygiene and Sanitation, Sangam Unity in Action. Accessed on September 20, 2011. Innovating around
India’s healthcare challenges. India Knowledge@Wharton, July 2010.
International Institute for Population Sciences and Macro International (2007). National Family Health Survey
(NFHS-3), 2005–06 (PDF) (pp. 436–40).
Ministry of Health and Family Welfare, Government of India. Accessed on October 5, 2012.
Kishore Jugal (2005). National health programs of India: National policies and legislations related to health. Century
Publications. ISBN 978-81-88132-13-3. Accessed on September 2, 2012.
Jssbilaspur.org. JSS–The bitter truth about rural health. Accessed on July 17, 2012.
Kamaldeo Narain Singh (1978). Urban development in India. Abhinav Publications. ISBN 978-81-7017-080-8.
Accessed on June 13, 2012.
Kanjilal, Barun, Debjani Barman, Swadhin Mondal, Sneha Singh, Moumita Mukherjee, Arnab Mandal & Nilanjan
Bhor (2008). Barriers to access immunization services: A study in Murshidabad, West Bengal. FHS Research
Brief (3).
Kanjilal, B., M. Mukherjee, S. Singh, S. Mondal, D. Barman & A. Mandal. (2007). Health, equity and poverty
exploring the links in West Bengal. FHS Working Paper 4, India. Available at http://www.futurehealthsystems.
org/publications.
Lalonde, M. (1974). A new perspective on the health of Canadians. Ottawa: Minister of Supply and Services.
Life Expectancy and Mortality in India, The Prajnopaya Foundation. Accessed on September 20, 2011.
Goering, L. For big surgery, Delhi is dealing. The Chicago Tribune, March 28, 2008.
Maternal & Child Mortality and Total Fertility Rates. Accessed on February 13, 2012.
Medical and Healthcare Facility Plagued. Abhinandan S, Dr Ramadoss. Accessed on September 20, 2011.
Mogli, G.D. (1983). Historical background of medical record administration in India, Int. Health Records Newsletter
of International Federation of Health Records Organizations (IFHRO), 3(11).
National Accreditation Board for Hospitals & Healthcare Providers. Chennai–India’s health capital. India Health
Visit. Accessed on September 1, 2012.
Phd chamber of commerce and Industry (2011). Growth prospectus of Indian economy.Vision 2021: Trillion dollar
growth opportunities. Available at www.phdcci.in/admin/admin_logged/banner.../1334554213.pdf. Accessed on
January 5, 2012.
Preventindia.org. Accessed on July 17, 2012.
Public Health Agency of Canada (2011). What Determines Health? Ottawa. Accessed on May 12, 2011.
PWC (2011). Healthcare unwired health insurance and healthcare access. Available at www.pwc.in/assets/pdfs/.../
Health_Insurance_Report_FV.pdf. Accessed on January 3, 2013.
Raghav Narsalay, Mamta Kapur, Ryan Coffey, Aarohi Sen & Smriti Mathur (2012). Tough times ahead: No room for
complacency, India in 2012. Available athttp://www.scribd.com/doc/100108518/Accenture-India-2012-Tough-
Times-Ahead-No-Room-Complacency. Accessed on January 3, 2013.
Ravindra L. Kulkarni (2012). Modern lifestyle is taking a toll on our hearts. Available at http://justforhearts.org/
modern-lifestyle-is-taking-a-toll-on-our-hearts/. Accessed on January 3, 2013.
Ratnika Sharma (2012). PPP is the way forward to improve healthcare in India: McKinsey. 12th Five Year Plan.
Public-private partnership (PPP) in healthcare.
Reason to smile. The Hindu. Accessed on October 24, 2011.
Rieff, David (2009). India’s malnutrition dilemma.The New York Times 2009. Accessed on September 20, 2011.
Robinson, Simon (2008). India’s medical emergency. Time US. Accessed on September 20, 2011.

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Health Care Management in India 147

Rupa Chandra, Foreign investments in hospitals in India. (2007). Status and implications Bangalore: IIM-Bangalore.
Sutherland, T. & D.M. Bishai (2008). Cost-effectiveness of misoprostol and prenatal iron supplementation
as maternal mortality interventions in home births in rural India. International Journal of Gynecology and
Obstetrics. Accessed on May 26, 2012.
Sharma, S. Childhood mortality and health in India. Institute of Economic Growth University of Delhi Enclave
North Campus India. Accessed on September 9, 2011.
Swamis to Surgeries. Available at medicaltourismmag.com. Accessed on January 19, 2011.
The Hindu (2012). Fortis to offer affordable healthcare in smaller towns. Available at http://www.thehindubusinessline.
com/companies/fortis-to-offer-affordable-healthcare-in-smaller-towns/article2147808.ece. Accessed on January
3, 2013.
The Indian IT Sector Analysis. Available at http://itm7group1.blogspot.in/2012/12/overview-of-indian-it-sector.
html. Accessed on January 5, 2013.
The Indian Pharmaceutical Industry: KPMG India. Available at www.in.kpmg.com/pdf/Indian%20pharma%20
outlook.pdf. Accessed on January 7, 2012.
Tuddenham, S.A., H. Rahman, S. Singh, D. Barman & B. Kanjilal (2010). Care seeking for postpartum morbidities
in Murshidabad, rural India. International Journal of Gynecology and Obstetrics, 109(3), 245–46. Accessed on
May 26, 2012.
Hindustan Times. (June 27, 2007) Urbanisation in India faster than rest of the world. Accessed on June 13, 2012.
Vijaya Sawant (2009). India’s Independence Day and progress it made ever since. Available at https://oratechsolve.
wordpress.com/2009/08/16/india%E2%80%99s-independence-day-and-progress-it-made-ever-since/. Accessed
on January 8, 2013.
Water, Environment and Sanitation, UNICEF India. Accessed on September 20, 2011.
Report by India Brand Equity Foundation. (2010). Available at http://www.ibef.org/.
World Health Organization (2011). The determinants of health. Geneva. Accessed on May 12, 2011.
www.Wikipedia.org
சென்னை இந்தியாவின் மருத்துவ தலைநகரா?. BBC Tamil. April 12, 2012. Accessed on September 15,
2012.

Journal of Health Management, 16, 1 (2014): 133–147

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016

Downloaded from jhm.sagepub.com at PENNSYLVANIA STATE UNIV on May 11, 2016