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Lack of funds cripples free medicine scheme

delhi Updated: May 24, 2013 02:15 IST
Chetan Chauhan
Chetan Chauhan
Hindustan Times
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The UPA government’s big bang promise of providing free generic medicines to all through government hospitals had come as a cropper with the state governments refusing to implement the scheme without adequate financial help.

The UPA government in a bid to reduce in-pocket health expenses from 71 % to 50 % had announced a plan to distribute free generic medicines to all during the 12th five year plan (2012-17).

The government had also said that it would set up a national body ---Central Procurement Agency --- to specify uniform standards for procurement of generic medicines and help state governments procure the medicines at cheapest possible rates.

“Transparent systems should be built to ensure that all procurements adhere to the highest standards,” Planning Commission deputy chairperson Montek Singh Ahluwalia had told HT in October 2012.

Almost six months later the Planning Commission had a change of heart and cited fund constraint as a reason for agreeing to the health ministry’s proposal in this regard. The initial cost of the scheme was high as money had to be provided for construction of warehouses, building of cold-chain and training of personnel.

“The state government wanted us (the Centre) to provide funds if the scheme was to be to implement,” said a senior government functionary. “But, the planning commission refused to spare that sort of money”.

A plan panel official said that the Finance Ministry had agreed to just 6% increase in plan expenditure for 2013-14 and it did not provide much “flexibility” to them to spare money for starting a new scheme. The government had already approved a new scheme, National Urban Health Mission, earlier this month, which would cost the Centre Rs. 16,955 crore in the 12th plan. The scheme aims to cover 7.75 crore people in towns having population of more than 50,000.

With this, the officials said, there was not enough money to fund the proposal mooted by Prime Minister Manmohan Singh last year. “Now we would advise the state governments on how to provide free medicines to all in a cost effective way,” said a senior health ministry official.

Tamil Nadu has already shown the way by ensuring free medicines to all in-house patients in government hospitals in the state. The Tamil Nadu Medicines Supply Corporation procures generic medicines in bulk up to 1/20th of the market price from pharma companies and supplies them to the government hospitals.