High medical fees would only keep the poor out

Charging affluent students higher fees and higher charges for affluent patients could subsidise the needs of the poor

The Maharashtra government has decided to increase the annual fees for medical education from Rs18,000 per annum to over Rs40,000 per annum, with an additional Rs5,000 for entrance fees. The government has already raised charges for various hospital services in the state by at least 100%. The reason cited was “increasing costs”, while the Maharashtra government has stated that it is spends Rs4.8 lakh per student per annum for their education. The hike appears justifiable – or is it? Let us examine.


The Mumbai Municipal Corporation spends around Rs500 crore on its four medical institutions. The state government spends much less, but it cannot run a medical college without spending Rs40-Rs50 crore. If a college teaches, say, 500 students it will fetch an additional income of at least Rs1.25 crore. Is it really going to help? The state spends less than 1% of its gross domestic product (GDP) on health, so it can easily absorb this Rs1.25 crore per college without any strain on its budget, and the price hike is not advantageous. Even a large number of students will be unaffected, as they belong to the affluent class. The real sufferers will be the poor students, which comprises more than 50% of the population, whose guardians earn less than Rs20,000 per month. An additional burden in form of the price hike amounts to a loss of more than one month’s income. When we take into consideration the rising costs of food, house rents, travel and basic education for other children, it leaves very little or no scope of saving even a rupee.


In order to secure a seat in state-owned medical college, which offers subsidized education, a student has to secure around 95% marks in the HSC examination (and later CET). Even if the poor student has as much talent if not more, it is the affluent class students who score better largely due to access to facilities like special tuitions, home coaching and better atmosphere in the house. Therefore, even today, more than 50% of the medical students, including those from reserved categories of other backward castes (OBCs) and scheduled casts (SCs), belong to the economically privileged classes. A talented student from low-income family is virtually denied admission to both government and private medical college owing to lack of finance. The fee hike will hit poor the hardest, and thus the government has effectively made it nearly impossible for them to get admitted to medical colleges irrespective of their merits. If this is the case, why should medical education be subsidised at all? Will these affluent graduates charge less or will they join the government service to serve the poor? Then, why not raise the fees by Rs2 lakh, instead of a mere Rs25,000?


The subsidy can now be justified on the grounds of the financial status and the students getting subsidy should be ‘bonded’ to serve the state (in rural areas or otherwise) for at least 10 years. Students with a family income of Rs75,000 per month should pay full fees, while a 50% concession could be offered to those with a monthly income above Rs40,000 per month (with a bond, of course). Those with income below this (i.e. Rs18,000 per annum) may continue to pay the present fee. With nearly 60% of the students belonging to the first two groups, colleges with at least 100 admissions will be able collect Rs4-Rs5 crore, without taxing the poor. Freedom from the bond will induce many students to pay full fees, irrespective of their status. The government could spend part of this money for poor students who are eligible for admission, on merit, by subsidising their fees.


Hike in education fees isn’t the only thing that will bitterly affect the poor. The hike in hospital service charges, too, will affect them the hardest. There was a 20% reduction in treatment of poor people, when charges were hiked, between 1999 and 2001. Worse could happen now with old people, women and dependents from poor backgrounds. This is also preventable, if the principle of differential payment is adopted here too. “From each according to his ability and to each according to his need” is the motto of any socialist organisation.


The way patients are allowed to attend medical college hospitals is utterly disorganised. The path to tertiary centres could be properly regulated, at least for the poor. They will have to attend a primary health centre and/or a secondary hospital before being referred properly to a tertiary centre. Even without a reference, the poor could be allowed to attend here, if they had taken treatment at a primary centre for a stipulated time and were not satisfied. Medical college hospitals should keep a specified time in the OPD (out patient department) strictly for such patients. This system will also help in reducing the unnecessary crowds in medical college hospitals, as many patients will get their full treatment at the peripheral centres. If the poor need admission, 50% beds in the wards should be strictly reserved for the poor without any increase in the charges. Yet, some affluent patients would not like to go to primary centres at all and would insist on attending college hospitals directly. In this case, authorities could be justified in charging them four to five times higher, as they are not poor. Separate timings in the OPD for the wealthy will ensure proper segregation of the two groups and 25% of the beds could be reserved for them, again, with hospital charges four to five times higher than for that charged for the poor.


For the privileged group, college hospitals could start a “pay-clinic” in the evening hours at full rates. Being a “Pay-Clinic” senior teachers could take charge of OPDs and be entitled to an incentive payment of “doctor’s fees”. Affluent patients will be investigated and treated in the evening hours only, thus sparing morning hours entirely for the poor and semi-poor groups. This way, senior teachers will be kept busy throughout the day, with incentive payment. This could be a win-win situation with income inflows of about Rs8-Rs10 crore for the college hospital. Overall, a medical college could earn about Rs12-Rs15 crore, without burdening the poor with any extra charge.


There are many more advantages with this scheme such as improved medical education, improved services, better maintenance of equipment and scope for self-expansion. I have explained all this in my book, “Management of the Sick Healthcare System”. I appeal to the politicians, medical activists, and the intellectuals to study the system and make appropriate changes, so that all the sections of the society benefit.


(Dr Sadanand Nadkarni, 80, is former Dean of Sion Hospital, author of several books, a serious thinker of medical issues and hugely respected for a series of path-breaking ideas on improving the delivery of medical services to the aam aadmi. His book “Management of the Sick Healthcare System” is among the first to speak out about medical malpractice and other issues. He can be reached at [email protected].)


Cabinet defers stake sale in SAIL

In the absence of the steel minister and secretary, the Cabinet did not take up the proposal moved by the Department of Disinvestment

New Delhi: The Union Cabinet on Thursday deferred a decision on selling 10.82% of its stake in Steel Authority of India Ltd (SAIL) as Steel Minister Beni Prasad Verma was away on official tour, reports PTI.

The Steel Minister is in Tokyo on an official tour and could not attend the Cabinet meeting.

In the absence of Verma and Steel Secretary, who is also in Tokyo, the Cabinet did not take up the proposal moved by the Department of Disinvestment, sources said.

The government has set a target of raising Rs30,000 crore this fiscal by selling stakes in 15 companies including about 10% in SAIL.

The 10.82% stake sale is likely to fetch about Rs4,000 crore at current market price. Government owns 85.82% in the steelmaker.


Jindal Group to set up Rs1,500-crore textile unit in Nashik

The technical textile unit will manufacture cloth related to automobile applications, sports, security, medical and fire fighting equipment

Mumbai: Jindal Group will set up a Rs1,500-crore technical textile unit in Nashik district of North Maharashtra, reports PTI.


Textile Minister Mohammed Arif Naseem Khan told PTI that a letter of intent (LoI) has been issued in this regard after the Group officials met him last week.


The Group is currently in the process of acquiring land. About 100 acres will be required for the unit which will manufacture cloth related to automobile applications, sports, security, medical and fire fighting equipment, he said.


Technical textile products are used primarily for their technical performance and functional properties rather than their aesthetic or decorative characteristics.


Investment proposals worth around Rs5,000 crore had been received ever since the Government announced a new textile policy a couple of months ago, the Minister said.


The policy, which focuses on cotton growing belts of Vidarbha, Marathwada and north Maharashtra, provides for incentives like 10% capital subsidy.


Khan said 162 projects are being covered under the new textile policy.


He said road shows are being planned in Gujarat, Karnataka and Tamil Nadu to attract investors in the key sector.


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