The renewed debate around the pricing of medicines and medical products has once again brought health care affordability into sharp focus. This is an important conversation. No patient should have to pay an unreasonable price for essential treatment, and wherever there are instances of unjustified pricing or excessive margins, they need to be addressed.
However, individual instances should not lead us to view the entire health care sector through the same lens. Nor should affordability be reduced to the price of a medicine, device or individual hospital service. For an Indian family facing illness, the real financial burden extends across the entire journey of care, from diagnosis and consultations to hospitalisation, medicines, procedures, rehabilitation and long-term follow-up.
The larger question before us, therefore, is how India can make quality health care more affordable and accessible while continuing to strengthen the health care system itself.
This becomes particularly important given the scale of India's health care needs. As the disease burden and demand for quality care increase, India will require continued investment in healthcare. We need to expand hospitals and health care infrastructure, strengthen clinical capabilities, adopt newer technologies and treatments, and improve access to quality care beyond the largest cities.
All of this requires sustained investment.
{{/usCountry}}All of this requires sustained investment.
{{/usCountry}}The health care industry has played an important role in building this capacity. Private health care providers, pharmaceutical companies, diagnostics businesses and medical technology companies have contributed to expanding the availability of specialised care, bringing new technologies and treatments to patients, and increasing healthcare capacity. We should expect transparency and accountability from the industry, but its contribution to India's health care system must also be recognised.
This is why the debate around further price controls requires careful consideration.
Price and trade-margin interventions can have a legitimate role where evidence points to disproportionate or unjustified pricing. But regulation should be targeted at addressing an identified problem rather than assuming that the same problem, or the same solution, applies across the health care ecosystem.
A one-size-fits-all approach is unlikely to work in health care.
A hospital does not have the same economics as a pharmaceutical company. The cost structure of a diagnostic service is different from that of a medical device. Even within these segments, costs can vary according to technology, infrastructure, clinical expertise, supply chains and the complexity of care being delivered.
Applying a uniform pricing approach without recognising these differences can create unintended consequences. At a time when India needs greater investment in health care capacity, we must carefully assess whether broad-based price controls could discourage precisely the investment required to build infrastructure, introduce newer technologies, strengthen clinical capabilities and expand access.
This does not mean that unreasonable pricing should be accepted. It means regulation needs to be more evidence-based, differentiated and calibrated.
Where there is credible evidence of excessive pricing, intervention should be focused and effective. Greater transparency across the health care value chain can help policymakers determine where problems exist and what kind of intervention is appropriate. At the same time, the impact of any intervention on access, availability, quality, patient safety, clinical outcomes, investment and innovation should also be considered.
The objective should not simply be to achieve the lowest possible price on paper. It should be to ensure that patients receive appropriate, high-quality care at a cost they can reasonably bear.
We must also recognise that price controls alone cannot solve the larger affordability challenge.
For many families, the financial impact of illness comes from cumulative expenditure across diagnosis, treatment and recovery. Reducing the price of one component may provide relief, but it may not substantially reduce the overall burden of care. This is particularly relevant for chronic and complex diseases where patients may require treatment and monitoring over long periods.
Health care financing and wider financial protection must therefore be part of the affordability discussion. Strengthening insurance coverage and reducing the burden of out-of-pocket expenditure can help ensure that households are better protected when serious illness occurs.
Similarly, expanding health care capacity can itself improve access. India needs more investment in hospitals, diagnostic facilities, technology and skilled clinical capabilities, particularly as demand for healthcare grows. Public and private investment will both be necessary to meet this challenge.
There should be no contradiction between protecting patients and creating an environment in which health care investment can continue. The two objectives are closely connected. A sustainable health care ecosystem must be able to protect patients from unjustified costs while continuing to invest in better infrastructure, medical capabilities, technologies and access.
It is equally important that instances of excessive pricing do not come to define the entire industry. Wrong practices, wherever they exist, should be identified and addressed. But broad conclusions about the sector based on individual instances risk overlooking the substantial role health care enterprises have played, and will need to continue playing, in meeting India's growing health care requirements.
As India considers the future of healthcare pricing, we, therefore, need a framework that is transparent, accountable and firmly grounded in evidence. Regulation should respond to demonstrated problems, recognise the differences across various parts of the health care ecosystem and assess the wider consequences for patients and the health system.
Affordability, access, quality, investment and innovation are not competing objectives. A country with India's health care needs cannot afford to pursue one at the expense of the others.
Ultimately, the test of any health care pricing intervention should be straightforward: Does it protect patients from unreasonable costs while preserving access to quality care and enabling the health care system to continue investing for the future?
Getting that balance right will determine not only what healthcare costs today, but the kind of health care system India is able to build for tomorrow.
(The views expressed are personal)
This article is authored by Kirit P Solanki, former Lok Sabha MP, New Delhi.