Healthcare Industry Reacts to Budget 2022-23
With announcements of National Digital Health Ecosystem and National Tele Mental Health program, digital health received a significant push but other areas remain largely ignored. Indian healthcare leaders share their views on the overall budget.
Dr. Vivek Desai, Founder & MD, HOSMAC
Whilst one welcomes the FM's point on creating a National Digital Health Ecosystem which will be beneficial in the long-run and also creation of Tele Mental Health centres; apart from maintaining the Ayushman Bharat allocation at Rs. 6412 (despite less than half of the allotted budget was spent last year), there isn't much stimulus for healthcare. This is surprising as everyone was hoping that healthcare infrastructure creation will get a boost in some way after two continuous years of pandemic hit healthcare sector . One may need to evaluate the fine print of health budget allocations to see how funds have been allocated. India’s glaring need is to create more hospital beds and increased skilling of medical and paramedical human resource to service these beds.
Dr. Pratap C Reddy, Chairman, Apollo Hospitals
“During the pandemic, we saw an immense contribution of start-ups to innovation in healthcare and the extension of the tax benefits for another year should encourage more start-ups in the healthtech space to come up and invest in R&D especially in the field of AI powered smart wearables and predictive healthcare. This will in turn be invaluable in strengthening our fight against non-communicable diseases, which can otherwise derail the economic recovery by impacting our productive demographic.
Dr. Naresh Trehan, Chairman-MD, Medanta
“If you look at Budget, there's very little mention of healthcare. 2-3 things help us - one is the fact that the skilling initiative has been intensified, it's good. We need skilled manpower to assist with the healthcare system.”
Dr. Tarang Gianchandani, CEO, Sir HN Reliance Foundation Hospital
“The major focus of the Union budget is infra spending, given its sheer size and inter-connectedness. The overall growth and development of the infra sector will also help provide better healthcare services to all citizens and help creating jobs in the country. The National Digital Health Ecosystem will help create a robust platform for managing all health records and help provide universal access of records to all citizens across India. Given the Covid-19 pandemic our budget has also focused on addressing Tele mental Health program which is a step in the right direction and will also benefit a large number of patients."
Gandharv Roy, COO, Medica Superspecialty Hospital
“Budget 2022-23 needs to address the low per capita spend ($3) on indigenous medical devices since there is a significant dearth in indigenous manufacturing, and imports constitute over a significant percentage of the high-end medical device market. India is a fertile ground for MedTech innovation, and the industry yearns for single window clearances for startups to thrive in the ecosystem. If the government could set up a system to facilitate early validation of MedTech devices and services, it could exponentially accelerate the development and deployment of various technologies in healthcare. Tax break for 10 years for setting up facilities in upcoming economic zones, MedTech Parks & MedTech Manufacturing facilities is one of the primary needs. Government should also look at an increase in customs duty of finished medical equipment / devices and subsequent reduction in customs duty for components and SKD imports to promote ‘Make in India’. I suggest reintroducing tax holidays for rural hospitals with a flexibility to select beneficial years and viability gap, reducing GST across all medical products and services, increasing the healthcare expenditure above 2.5 per cent of the GDP, retaining intellectual capital, 1 percent levy in GST regime to bring down overall health costs and integration of technology and healthcare to improve the clinical care output.”
Gautam Khanna, CEO, P. D. Hinduja Hospital & MRC
“Preventive Health Check-ups should be given greater emphasis, given the fact NCDs will account for 75% of India’s disease burden by 2025. Raising the tax exemption on preventive health checks, expedite setting up and operationalising PHCs announced in the earlier budget, and nutritional emphasis in rural areas are some of the steps that can help achieve this. We would recommend the benefits of section 35 AD of the Act under capital expenditure, which was extended to hospitals with 100 beds or more should be made available to all hospitals. Further recommending that the healthcare industry be brought under Industrial Undertaking under provisions 72 of IT act to ensure that tax losses of the healthcare Industry are carried forward and set off against future profits.
Joy Chakraborty COO, P. D. Hinduja Hospital & MRC
“Availability of skilled manpower remains a key challenge. The government should expedite the implementation of setting up of medical colleges announced in the earlier budget. To encourage the private sector to take up workforce skilling activities, the government should consider providing tax incentives for expenses incurred in healthcare skill development and tax deduction on stipends to professionals undergoing DNB and PG courses at hospitals.”
Dr. Harish Pillai, CEO–Metro Pacific Hospital
“In view of the impending series of state elections, it is a remarkable Budget devoid of tempting populist announcements and setting the roadmap for India@100 focusing on the creation of both capital and social infrastructure and setting up a strong foundation for accelerated growth.”
Amol Naikawadi, Joint Managing Director, Indus Health Plus
“In the Union Budget 2022, the government has kept a wide approach to accelerate the growth and well-being of people. In addition to this, the government’s decision on creating an open platform for the National Digital Health Ecosystem is highly appreciated. This will help in maintaining digital registries of health providers and health facilities, unique health identity and universal access to health facilities. Also, with the increasing incidences of mental health during pandemic, the government’s step to develop a national tele mental health program for better access to quality mental health counseling and care is appreciable. The decision to open 23 tele health centres to boost the healthcare sector and make it more accessible for people who are living in the remotest area of the country is a welcome decision. However, the government should have also focused on preventive healthcare for NCDs as it plays most important role in keeping India Healthy. Healthy India can play most important role in achieving all the objectives our country has in short and long term.’
Rana Mehta, Partner and Leader Healthcare, PwC India
“The pandemic has caused a silent global mental health epidemic. The use of telemedicine to diagnose and treat such patients has proved to be highly effective given the unobtrusive nature of the interaction which also ensures patient privacy. Given the shortage of mental health professionals, especially in rural areas, telemedicine will greatly enhance accessibility for patients requiring psychiatric help.”
Dr. Roy K George, National President, The Trained Nurses Association of India (TNAI)
“Finance Ministers announcement of an open platform for the National Digital Health Ecosystem which will consist of digital registries of health providers and health facilities, unique health identity and universal access to health facilities is a welcome move. Indian Nursing Council has been working towards implementing a Live Register (Nursing Registration Tracking System) which is a is a web-based application to enable creation of live register of the nurses across the country.
We are happy that a national tele mental health program for counselling is also being announced today. The pandemic has been especially difficult for healthcare workers as well as they have been affected by psychological and mental issues. We believe that a compromise on the mental health of our nurses and midwives will adversely affects healthcare delivery, patient care and safety.
We are also hopeful that the announcement of Rs 64,180 crore (Ayushman Bharat Health Infrastructure Mission) will help strengthen capacities of primary, secondary, and tertiary Health Care Systems, including existing national institutions, and create new institutions to cater to detection and cure of new and emerging diseases. India has battling shortage of nurses and midwives for years now and we are hopeful that some initiatives will be taken to improve basic infrastructure for the overall development of the cadre.”
Mythri Macherla, Assistant Vice President & Sector Head, Corporate Sector Ratings, ICRA Limited
“Given that one-time healthcare costs during the second wave of Covid-19 are expected to have bumped up the expenditure in FY2022 and assuming that there are no severe waves in FY2023, the increased allocation (growth of 16.1%) as against the FY2022 budgeted estimates is a welcome move. While allocation towards National Health Mission continues to remain flattish, increase in allocation towards Pradhan Mantri Ayushman Bharat Health Infrastructure Mission is expected to increase health coverage in FY2023. That said, continuing modest allocation towards the healthcare sector would make it challenging for the Government to meet its target of public sector healthcare investment of 2.5% of the GDP by 2025.”
Vikram Thaploo, CEO Apollo Telehealth
“The government in its last Union budget had placed health and well-being as the first of its six pillars, and with India into its third year into the Covid-19 pandemic, that focus has reflected in this year's Union Budget as well. The launch of the National Tele Mental Health Program which will include a network of 23 tele mental health centres of excellence with Nimhans being the nodal centre and IIIT Bangalore providing technology support is a welcome move by the government to augment the use of telemedicine services as well as provide support to people with mental health disorders. Also, an open platform for the National Digital Health Ecosystem will be rolled out and it'll further help in strengthening the healthcare services within the country. It will consist of digital registries of health providers and health facilities, unique health identity and universal access to health facilities. The increased investment towards Health Infrastructure and focus on a holistic approach to health is seen as a testimony of the commitment to building stronger health systems in the country.”
Mr. Rajiv Nath, Forum Coordinator, Association of Indian Medical Device Industry (AiMeD)
“We were expecting the government to move forward on promised reforms and anticipated conducive measures to boost domestic manufacturing of medical devices. It is frustrating that against our expectations, the government has not included any measures to help end the 80-85 per cent import dependence forced upon India and an ever increasing import bill of over Rs 46000 Crore & promoting growth Indian medical device industry other than repeating last year’s assurance to end custom exemptions of products that can be made in India.
Sadly the union budget 2022 speech has no strategic stated measures to boost domestic manufacturing. These are the same domestic manufacturers, when imports got disrupted during COVID-19 crisis, the government relied heavily on them to meet the rising demand of essential COVID items for the country pushing the Indian medical devices sector to become self-reliant.
The Indian medical devices industry’s expectations were:
Predictable tariff policy
Graded increase of custom duty to 10-15 per cent from current zero to 7.5 per cent
Reduced GST on 18 per cent where being applied to 12 per cent as medical devices are not luxury goods.
Not clear if health ess applied on some medical devices being also applied on other medical devices
No announcement on R&D related tax breaks to motivate indigenous development We had been hoping that this will be a Make in India push budget for an Atmanirbhar Bharat and though the FM has highlighted the need to support manufacturing sector, we, The Indian medical device industry are disheartened not to notice any changes in custom duty as done for other sectors and are very hopeful that the fine print of the Union Budget would have possibly acted upon our recommendations on a predictable tariff policy for a Make in India push for phased manufacturing plan for components and finished medical devices and allocations for testing infrastructure as well as for med tech parks and cluster developments. Supporting policies are needed so that Indian medical devices industry can make quality healthcare accessible and affordable for common masses, aim to place India among the top 5 medical devices manufacturing hubs worldwide and help end the 80-85 per cent import dependence forced upon us and an ever increasing import bill of over Rs 46000 Crore.
The only positive announcement was on Public Procurement by allowing 75 per cent prompt payments and bringing in a weighted price preference on account of quality which is especially critical in healthcare related medical devices."
Sanjiv Navangul, Managing Director & CEO, Bharat Serums and Vaccines Ltd.
“We are encouraged by the recently announced roll out of the open National Digital Health Ecosystem platform that will further augment our country’s digital healthcare journey and create positive patient outcomes with digital registries of health providers and health facilities, unique health identity, consent framework and universal access to health facilities. As the country moves towards good health and economic well-being, it is critical to continue to innovate in India and the rest of the world. Today, the booming biotech innovation across the globe along with the accelerated adoption of digital technologies has redefined the contours of healthcare management. To build and grow the research-driven biopharmaceutical industry in India we continue to seek an enabling, supportive regulatory and policy framework that encourages and promotes research in order to bring positive patient outcomes. Further the Union Budget 2022 outlines ‘Genomics and Pharmaceuticals’ as the sunrise opportunities eligible for a supportive framework to build domestic capacities and promote Research & Development. This is encouraging as we collectively work towards building an Aatmanirbhar Bharat and an ‘Amrit Kal’ for every citizen of the country.”
Dr. Shravan Subramanyam, Managing Director, Wipro GE Healthcare
“We firmly believe that an integrated, digital-first healthcare system will be pivotal to India’s overall healthcare industry to ensure that quality, affordable, and personalized healthcare is accessible to all. However, to achieve this, we are hoping the government will focus on R&D, innovation in healthcare tech and investments in digital tools to support patient care and hospital workflow. Waiving off the duty & CESS and releasing sectoral payment dues will free-up working capital for investments in inventory of critical lifesaving equipment. Lastly, supporting and utilizing public-private partnerships efficiently will help drive access to care for non-communicable diseases, including appropriate funds for women’s healthcare, oncology, and cardiovascular research and care.”
Dr. Veena Aggarwal, Trustee Dr KK's Heart Care Foundation of India
"The budget for the year 2022-23 has been presented by the Government today. We had great expectations from the budget with respect to an increase in healthcare expenditure particularly because of the Covid pandemic, which has exposed the inadequacies in the public health infrastructure as well as the disparities in the healthcare system. But again, health appears not to be a priority directly, though the government announced launch of a national tele mental health programme comprising of a network of 23 tele mental health centres of excellence with NIMHANS as the nodal centre in an acknowledgement of the impact of the pandemic on the mental health of the people. The government also announced the roll out of an open platform for the National Digital Health Ecosystem consisting of digital registries of health providers and health facilities, unique health identity and universal access to health facilities. Two lakh anganwadis will be upgraded with better facilities; 80 lakh affordable houses by 2023. Personal IT slabs remain the same. Though now taxpayers can file an updated return within 2 years from the end of the relevant assessment year.”
Mr. Ankit Kedia, Founder and Lead Investor, Capital A
“The Budget touches upon various important areas related to ease of doing business, and the investment arena. The 35.4% increase in the public sector investments budget suggests that the government will be investing heavily in the infrastructure development as well as the industries that need financial support. This alongside the announcement about investments in energy storing such as dense charging infrastructure and grid scale battery infrastructure will promote clean energy usage across the board, and that’s one area Capital A has also been focusing on. We are also launching a special cleantech focused fund for the development of Clean Energy and charging infrastructure, and this announcement augurs well in that direction. The government has extended startup tax holiday and concessional tax for manufacturing startups by a year. While that was on the cards, it doesn’t address the core need of startups to be given a longer tax holiday of 5 years as required. There hasn’t been any announcement to cover all startups registered with DPIIT for the tax holiday either, and that was a much- needed measure for companies hit by the pandemic. FDI in the sustainability sector is also announced to be facilitated, and we look forward to follow up action on that account. One of the most encouraging aspects of the budget has been the announcement to setup an AVGC (animation, visual effects, gaming, and comics) promotion task force to plan and build domestic capacity for serving domestic as well as global markets. Overall, this budget seems to be reasonable with some areas of improvement that will hopefully get attention in the coming months.”
Mr. Satish Kannan, Co-founder & CEO, MediBuddy
“The budget keeps us on track on enabling universal health accessibility with the proposed National Digital Health Ecosystem. With digital registries of health providers and health facilities, unique health identity for each individual, this will help in providing universal access to health facilities. Along with the national tele-mental health program, this shows the enhanced focus on health. At Apollo Hospitals, we look forward to contributing to the success of these path-breaking initiatives along with rest of the private sector healthcare. Rising concerns relating to health have been worrisome amongst young individuals and adults alike in the country for quite a while. The pandemic has only further escalated and triggered these issues, further causing a rise in the same. We warmly welcome the decision taken by the Honourable Finance Minister in the budget to set up a National Tele-Mental Health Programme, to support the mental health grievances of citizens across the country. It is a much-needed initiative that holds the potential to provide assistance and guidance to those who are suffering. We truly believe that one’s mental health is as important as their physical well-being, and if there is something that’s bothering and affecting them, we want them to know we are here for them. MediBuddy has been a pioneer in the industry at assisting individuals dealing with mental health issues.”
Mr. Nilesh Aggarwal, CEO, IJCP Group, Founder, Medtalks and eMedinexus
“The focus on e-learning and exploring digital mediums for continued education is a welcome step for all sections of the society. The finance minister announced opening platforms for the National Digital Health ecosystem that will consist of digital registries of health providers and health facilities, unique health identity and universal access to health facilities. This will be important towards building a more independent health ecosystem and provide equitable access to health facilities and better accountability of the health service providers. We are ready to support the Government on digital upskilling with our large bank of upskilling and CME courses.
The national tele mental health is an important step, especially in view of the mental issues caused by the pandemic. We at MEDtalks have several mental health courses for healthcare professionals and other digital support tools to empower the public about their mental health.
We had however hoped for a much bigger focus on healthcare given the Covid pandemic so that we can attract more investment in the sector.”