Indian healthcare sector has got something to cheer about now as India has made its first major move towards providing free medicines for all.

 Health minister Ghulam Nabi Azad has cleared Rs 1,300 crore under the National Rural Health Mission (NRHM) scheme for states to support their purchase of medicines.

The largesse will not only help buy general drugs for government-run hospitals but also those needed under the Janani-Shishu Suraksha Karyakram (JSSK).

Under the JSSK, all pregnant women delivering in public health institutions are entitled to free and cashless delivery, free C-section , exemption from user charges, free medicines, blood, consumables and diagnostics and free diet for three days in case of normal delivery and seven days in case of C-section.

The minister has also asked the states to prepare a policy articulation document, an essential drugs list and standard treatment protocols and introduce a procurement system and supply chain management.

“States already have a budget to purchase drugs but it isn’t enough. The latest allocation is to support the state budget for 2012-13,” a ministry official said.

Officials said that states will have to procure drugs through an open tender. Companies applying for the tenders will have to have good manufacturing practices, compliance certificate, a noconviction certificate and should have a specified annual turnover. The drugs will also have to carry a not-for-sale label printed on the packaging.

The ministry says up to 75 percent of private out-of-pocket health expenditure is on purchasing drugs of which 76 percent is spent on purchasing OPD drugs. The free medicines for all the programmes are estimated to cost Rs 28,560 crore during the 12th Five-Year Plan.

At present, the public sector provides healthcare to 22 percent of the country’s population and it is likely to swell to 52 percent by 2017 once medicines are provided for free from 1.6 lakh sub-centres , 23,000 primary health centres, 5,000 community health centres and 640 district hospitals.

The Planning Commission says 39 million Indians are pushed to poverty because of ill health every year. Around 30 percent in rural India didn’t go for any treatment for financial constraints in 2004.

In urban areas, 20 percent of ailments were untreated for financial problems the same year. About 47 percent and 31 percent of hospital admissions in rural and urban India, respectively, were financed by loans and sale of assets.

A ministry official said it is being made mandatory for all doctors in the public sector to prescribe generic drugs and salt names and not brands.

The Cabinet has approved the setting up of a Central Procurement Agency for bulk procurement of drugs. “Only a handful states will be able to roll out free medicines by this year end,” an official said.

Indians spend heavily out of their own pockets to purchase out-patient drugs, so providing free essential medicines is a welcome move from the government.

However, it will remain a meaningless gesture unless good-quality drugs are provided, doctors are monitored to ensure that they prescribe generic drugs rather than branded ones and states put in place a transparent procurement system and supply chain management.

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