Context: The effectiveness of Union Budget allocations for India’s health sector largely depends on State-level factors. Since many health initiatives are implemented as Centrally Sponsored Schemes (CSS), State governments play a vital role in their success by sharing costs and ensuring smooth execution. Two major CSS programs, the Pradhan Mantri Ayushman Bharat Health Infrastructure Mission (PM-ABHIM) and Human Resources for Health and Medical Education (HRHME), aim to bolster India's healthcare infrastructure and workforce, but their success faces multiple hurdles.
Key Initiatives in Health Sector
- PM-ABHIM
- Aims to strengthen health infrastructure, build health and wellness centres (HWCs), block-level public health units (BPHUs), district public health labs (IDPHLs), and critical care hospital blocks (CCHBs).
- Focuses on improving India’s emergency preparedness, especially for pandemics.
- HRHME
- Focuses on increasing the capacity of medical education by establishing new medical, nursing, and paramedical colleges.
- Plans to strengthen district hospitals and convert them into medical colleges.
- Aims to address shortages of medical personnel through increased seats and better training infrastructure.
Key Highlights of the article
1. Low Fund Utilisation in Key Health Schemes: Despite ambitious goals, fund utilisation in both PM-ABHIM and HRHME has been low, reflecting inefficiencies in budget absorption.
- PM-ABHIM: In 2022-23, only 29% of the budget estimate was spent. In 2023-24, although the revised estimate increased to 50%, the actual expenditure is expected to be lower.
- HRHME: Utilisation of funds was around a quarter of the budget estimates in both 2022-23 and 2023-24.
Key Challenges in Fund Utilisation
- Dependence on 15th Finance Commission Health Grants
- Around 60% of PM-ABHIM’s funding is sourced from health grants recommended by the 15th Finance Commission. Only about 45% of these grants were utilised from 2021-22 to 2023-24, partly due to complex execution procedures at the State level.
- Integration of Health Programs
- States are required to merge public health labs from various vertical programs under IDPHLs, necessitating significant planning and reorganisation. This integration has delayed implementation.
- Delayed Fund Absorption in Construction Projects
- Components like BPHUs and CCHBs involve construction, where fund absorption is slowed by rigid procedural requirements and overlapping funding from multiple sources.
2. Shortage of Faculty and Specialists: A major challenge for HRHME is the shortage of teaching faculty and specialists, which affects both new and existing medical institutions. According to a study by the Centre for Social and Economic Progress (CSEP),
- Faculty Shortage in AIIMS: There is a 40% shortage in teaching positions across 11 newly created AIIMS.
- State Medical Colleges: In Uttar Pradesh, 30% of teaching faculty positions in newly established government medical colleges were vacant in 2022.
- Specialist Shortages in Hospitals: More than a third of sanctioned specialist positions in urban CHCs and two-thirds in rural CHCs were vacant as of March 2022.
3. Fiscal Space Constraints for States: The financial burden of maintaining new health infrastructure will fall on State governments once the central support ends in 2025-26. States will need to plan for additional recurring costs, which may strain their fiscal space.
- State governments need to create fiscal capacity not only to sustain PM-ABHIM and HRHME infrastructure but also to support other health schemes and initiatives.
Conclusion: For the Union Budget’s health allocations to translate into meaningful health outcomes, the following factors are crucial:
- Strengthening the fiscal capacity of States to support recurring expenses.
- Addressing human resource shortages, especially in teaching faculty and specialists.
- Streamlining public financial management processes to improve fund absorption and scheme execution.
Addressing these challenges will be essential to ensure that capital expenditures in India’s health sector lead to improved infrastructure and better healthcare delivery.