5 reasons India’s ‘Missing Middle’ is struggling to access quality healthcare

The unfortunate event of COVID-19 has brought the Indian healthcare system to centre stage. A country of 1.3 billion people but India spends barely 1.5% of its GDP on healthcare, which is amongst the lowest in the world.

In June 2021 NITI Aayog launched a report on ‘Health Insurance for India’s Missing Middle’ claims that ~30% of the population are devoid of any financial protection for health. According to the report, The Ayushman Bharat scheme covers ~50% of the population. Around 20% of the population is covered under social health insurance and private voluntary health insurance. The remaining 30% of the population lacks any financial backing for healthcare treatment – this segment is termed the ‘missing middle’ because they are not poor enough to be covered by government-subsidized schemes but not rich enough to afford private health insurance. However, the actual number of uncovered individuals is much higher due to the existing coverage gap in the Ayushman Bharat scheme. 

The country has made strides toward Universal Health Coverage with the launch of the ‘Ayushman Bharat’ Pradhan Mantri Jan Arogya scheme in September 2018. The scheme is considered to be the largest fully government-subsidized scheme in the world, covering ~50% of the country’s population. The scheme caters to 10.9 crore families or 49 crore individuals that are categorized in the Socio-Economic Caste Census 2011. The Ayushman Bharat scheme offers subsidized healthcare packages with annual coverage of Rs.5 lakhs per family on a floater basis. As the scheme is limited to covering ~50% of India’s population at the bottom of the pyramid, an average Indian middle class continues to struggle to access healthcare treatment.

The outbreak of the pandemic has cracked open the gap which requires immediate attention.

Lack of infrastructure

The epidemic showed that the Indian healthcare system is not ready for any catastrophic events similar to COVID. The government’s spending on healthcare, the gap in demand and supply, and chronic shortages are some of the concerns that need urgent attention. Data suggests that India has 1.4 beds per 1,000 people, 1 doctor per 1,445 people, and 1.7 nurses per 1,000 people.

The disparity in the Rural-Urban healthcare system

Over 75% of the healthcare infrastructure is concentrated in metro cities, where only 27% of the total population resides—the rest 73% of the Indian population lack even basic medical facilities. The primary medical centers are lacking over 3,000 doctors and in the last decade, the shortage has increased by ~200%. Quality healthcare treatment can be found in the urban areas but often the person from a rural part of the country cannot afford to come to the metro cities for the treatment.

Lack of trained and skilled resources

One of the most critical concerns is the gap in the doctor-patient ratio. According to the Indian Journal of Public Health India needs 2070000 doctors by 2030. However, a doctor in the government hospital attends to ~11000 patients, which is more than the WHO recommendation of 1:1000.

Expensive healthcare treatment

Medical procedures similar to cancer treatment, transplants, and critical ails bear immediate attention. Overburdened government hospitals often delay in offering timely treatment which diverts individuals to seek medical care in the costlier private hospitals. Even though, The Insurance Regulatory and Development Authority (IRDAI) directed all health insurance companies to offer obligatory Arogya Sanjeevani policies in April 2020. The policy will provide coverage up to Rs 5 lakh – 10 lakhs for essential healthcare treatment, but the policy is not sufficient to cover advanced treatments, transplants, and critical surgeries.

High out-of-pocket expenses

Indians pay ~63% of their medical expenses out-of-pocket, which is considered to be the highest in the world. A report from Brookings India based on NSSO surveys claims that ~7% of India’s population is pushed into poverty every year due to healthcare expenses.

Today, medical crowdfunding has emerged as an alternative financing option for India’s missing middle. In India, it is common for people to be drained of all life’s savings while trying to meet medical emergencies. often, even without the promise of recovery, leaving caretakers grasping at straws to stay afloat. Medical crowdfunding is an avenue for individuals to reach out to people and seek financial support. The crowdfunding platforms use state-of-the-art technology to enable a seamless fundraising process. With the advent of technology, the process of donation has become easy and transparent. However, the Indian crowdfunding industry has just scratched the surface and experts see sizeable potential in tier 2 and tier 3 cities. With the right awareness campaigns, collaborations, and education drives, we believe we can bring significant change in people’s lives in the rural part of the country too.

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