Blog‎ > ‎

How to stop cuts in Indian healthcare

posted May 27, 2012, 10:02 AM by Vishal Singh   [ updated Jun 25, 2012, 8:05 AM ]
The truth is out. It was always out but  had brought this out open in a big way.

Can MCI make healthcare more ethical by bringing regulations.  The whole business model for healthcare today is based on having more people sick. This is how the industry will grow.
 Healthcare industry has no incentive to control cost.  Until this incentives are not changed regulations will not help.

How do you bring incentives where industry really works to bring cost down.

The solutions is by having compulsory medical insurance.  Once the premiums are collected  the state will not deliver the services. There will not be state run hospitals. We know these are plagued by corruption and inefficiencies. The country will be divided into zones and private parties will be invited to set up hospitals. Hospitals will be paid a flat price on per person basis.
Now the hospitals will not  earn more money by having more sick people.  In fact in this system, they would want to have less sick people as their revenues are fixed based on the population.  All this still requires regulation to see that hospitals don't cut costs by compromising on procedures. But the game has been changed in this system. You don't want more sick people. You don't want more tests. Hospitals will want people to be more healthy and they will focus on preventive measures.

The model is discussed in detail at 

Every one wants others to be honest. I have always argued that honesty is a function of system. A right system can make a industry more ethical. With wrong systems it is impossible to expect ethics.