Special IARIW-SAIM Conference on “Measuring the Informal Economy in Developing Countries”, Kathmandu, Nepal, September 24-26,2009

NGOs and NPISHs in Health Sector: Possibilities and Policy Options;

An Exploratory Study in the Indian Context

P.M. MathewChrist UniversityBangalore, India

Discussant M.R. Narayana, Ph.D

Professor of EconomicsInstitute for Social and Economic Change

Bangalore, India

FOCUS AND METHODOLOGY OF THE PAPER

FOCUS• Description of the role of NGOs (specially, voluntary organizations)

in delivery of health services in India with special reference to their health expenditure

• Brief review of literature on NGOs in health sector• Distinction of types of NGOs• Select problems of NGOs• Policy options, supported by case studies

METHODOLOGY• Descriptive and positive analysis• Based on secondary data• Case studies

Role and advantages of NGOs• Supplementary to existing service providers with focus on

vulnerable sections of society (e.g. poor, slum dwellers and tribal populations) in rural areas (mainly village based)- useful to fill in health gaps

• Low cost delivery of services, due to less expenditure on salaries and wages, and voluntary services by people

• Close to people with more opportunities for identifying disadvantaged people and their health needs

• Open for diversified participation: charitable institutions, religious organizations, internal and external individuals and institutions through donations and collaborations

• Flexibility in operations – combining health care delivery with income generation programmes – Integrated development programmes

Size of health care NGOs and their services: Select estimates

Independent Commission of Health in India 1997: Number of NGOs =7000

Directory of Hospitals 1998 – 10 percent of all hospitals (937) and 13 percent of all beds (74498) in non-profit sector

Background paper for National Commission on Macroeconomics and Health 2005 - Christian missionary hospitals leads the provisioning of health services – 47 percent of all beds in private sector and 17 percent of all private hospitals/dispensaries

Health care expenditure by NGOs:Select estimates

National Health Accounts India (NHAI) 2001-02:

0.1 percent of total expenditure (Household expenditure=72 percent)

National Commission of Macroeconomics and Health 2005: 0.3 percent of total expenditure (Household expenditure=70 percent)

Major items of expenditure: Curative medicine & recurring -

About 98 percent

Major sources of financing – NHAI 2001-02

Grants from government=26.7 percent; User charges in hospitals and dispensaries=38.9 percent; and external assistance=25.5 percent

Problems of health care NGOs

• Insufficient resources- non-remuneration for health staff and workers and inadequate training; high turnover of middle-level staff; dependency on donor agencies

• Inefficient management including commercial operations (e.g. charging higher user fees) to meet with insufficient resources

• Superficial forms of local participation• Lack of community ownership• Lack of policy directions – non-announcement of

National Policy on Voluntary Sector

Policy options (specially for additional resource mobilization and subsidization)

• Community Health Insurance (CHI) – Ashwini in Niligiri Hills in Tamil Nadu state since 1992 – CHI for tribal population covering 13000 members – insurance reimbursements contributed around 50 percent of total hospital income in 2006-07

• Boutique Healthcare – an instrument of cross-subsidization – L.V. Prasad Eye Institute in Hyderabad (LVPEI)– 50 percent of patients are treated free of cost – Aravind Eye Hospital in Madurai – 70 percent are treated free of cost

• Healthcare-Microfinance Linkages – National Dawakhana in Nanded city empowers women and improves their ability to pay for health services

Policy options (specially for additional

resource mobilization and subsidization) • Donor Marketing and Product sales – LVPEI• Private-public partnerships – co-operative sharing of health facilities

(West Bengal government in 2004) – management of PHC by Sewa Rural at Jhagandia block in Baruch district for ten years from 1989 to 1999- MNGO/FNGO/SNGO programme for RCH services in Orissa

• International collaborations – Project ORCHID in Manipur in collaboration with Australian International Health Association and Emmanuel Hospital Association-Ankur Project-SEARCH in Maharashtra in collaboration with Save the Children USA and Bill and Melinda Gates Foundation

• Consultancy Services – through creations of Centres of Excellence

Discussion points

• Relative efficiency between NGOs and other providers of health care services

• Role of health care NGOs in Indian System of Medicine• Distinction between NGOs, voluntary organizations and

NPISHs, and their relationship with informal sector• Corporate social responsibility through foundations and

NGOs• Beneficiaries of health care NGOs and informal workers

and their dependents• Lessons from experiences in other developing countries

THANKS