Budget Reactions – Healthcare

Health Care Comments Off

Two new AIIMS, 5,000 new PG medical seats per annum, action plans for elimination of diseases like Kala Azar, Filariasis and Tuberculosis (TB), Safe Water for areas affected by fluoride and arsenic, transformation of 1.5 lakh health subcenters into Health and Wellness centers, separate health cards for elderly, Rs.6,000/- aid for every pregnant women, accreditation of colleges and promoting health care indirectly by increasing budget for road safety, agricultural, rural health and Swachh Bharat, the current budget is a step forward for improving the health care of society. But still more could have been done.

While the proposal to set up two new AIIMS in Gujarat and Jharkhand is a positive development, IMA wants an AIIMS in every state and an overall increase in the budget allocation to 2% of GDP to cover 80% of population who do not avail government health services.

This year’s budget makes a commitment towards structural regulatory reforms in medical practice and education as well as digital health. Though more focus could have been given to R&D in healthcare, many of the provisions are worth a mention and a step in the right direction.

In a move to widen the availability of essential drugs across India, an Amendment to the Drugs and Cosmetics Rules has been proposed. This will ensure availability of medicines at reasonable prices and also help people get access to life-saving medicines. New norms will also be formulated for the medical devices sector in order to reduce the cost of such devices and encourage investments.

The government also plans to add 5,000 post graduate seats per annum. More qualified doctors being the need of the hour for both urban and rural areas alike; this is a step in the right direction.

The government has also taken a positive step by deciding to start DNB (Diplomate National Board) courses in many District hospitals across the country, strengthen PG teaching in select ESI and Municipal Corporation Hospitals and encourage reputed Private Hospitals to start DNB courses. But the country needs more family doctors. All the PG seats that remain vacant may be converted into PG Family Medicine seats.

Action plans to eliminate Kala Azar and Filariasis by 2017, leprosy by 2018, measles by 2020 and TB by 2025 will bring a major relief. Focusing on elderly health care, the proposed Aadhaar card-based smart health cards would be a move in the right direction.

The Government also plans to bring down the maternal mortality rate (MMR) to 100 by 2018-2020 and also reduce the infant mortality rate (IMR) to 28 by 2019.

The budget also has provisions for personal income tax as follows:

· Existing rate of tax for individuals between Rs 2.5- Rs 5 lakh reduced to 5% from 10%.

o As a result of the combined effect of the new Section 87A rebate and the reduction in the lowest slab tax rate to 5% the tax burden for those with income up to Rs 3 lakh would be zero and tax burden those in the Rs 3 lakh to Rs 3.5 lakh bracket would be Rs 2500.

o Those earning Rs 4.5 lakh can therefore reduce their tax liability to zero by fully utilizing the tax break under Section 80C combined with these new proposals.

o Those falling in the higher income tax slabs will also be eligible for this lower tax rate of 5% on income between Rs 2.5 lakh and Rs 5 lakh. Therefore, those in the higher tax slabs will pay lower tax by Rs 12500 per person.

o Individuals earning between Rs 50 lakh and Rs 1 crore will have to pay a surcharge of 10% on the total income tax payable by them. Currently there was no such surcharge on this category. Only those with income above Rs 1 crore were required to pay surcharge of 15% which continues

· All other categories of tax payers in subsequent brackets will get benefit of Rs 12,500.

· Simple one page return for people with annual income of Rs. 5 lakh other than business income.

· People filing I-T returns for the first time will not come under govt. scrutiny.

· 10% surcharge on individual income above Rs. 50 lakh and up to Rs 1 crore to make up for Rs 15,000 crore loss due to cut in personal I-T rate. The 15% surcharge on individual income above 1 crore remains.