In the past, governments have focused on rural health, and rightly so. Expenditures under the National Health Mission (NHM), India’s primary public health and healthcare delivery vehicle, make this apparent. Union government expenditure on urban areas was ₹850 crore in 2019-20, compared to nearly ₹30,000 crore for rural. However, with rapid urban population growth, a lack of government primary and preventive health infrastructure in urban India poses a challenge. Against a norm-based target of 9,072 urban primary health centres (UPHCs), only 5,190 are operational. Further, most states do not have urban sub-centres (SCs), people’s first point of access for healthcare services. There are only 3,000 urban SCs compared to over 150,000 in rural areas.
As a result, three-fourths of the population accesses basic healthcare at private facilities in urban areas, compared to two-thirds in rural. Urban areas also suffer from ‘over-hospitalization’ of basic care, ideally done in clinics. Further, the UPHCs, modelled on their rural counterparts, are not appropriate for urban high-density settings and their distinct epidemiological challenges. Covid has highlighted the need to focus on urban preventive and promotive health.
The government has shown a political and financial will to address this issue. The 2021-22 budget provides ₹5,000 crore for urban primary health through urban local bodies (ULBs), a large addition over the ₹1,000 crore NUHM budget. These allocations come from the 15th Finance Commission (FC) grants for primary health to our third tier of government. Nearly 40% of 15th FC’s earmarked health grants—worth ₹70,000 crore over a five-year period (2021-22 to 2025-26)—are for urban areas. Much of this money will be used to build urban health and wellness centres (HWCs).
But, why ULBs? Why not continue with the state government-led model? There are two reasons. First, municipalities are best placed to understand the needs of the population in their wards. They are closer to the communities they serve. Second, they are more responsive to the demands of citizens, given their greater direct accountability and accessibility.
Experiences from Argentina and Brazil, and closer home in Kerala, show that the decentralization of healthcare to ULBs is beneficial. For example, Argentina’s Plan Nacer—where city governments receive funds from the national health ministry based on population coverage—has had a positive effect. The probability of low birth weight, a key health outcome, fell by 23% in Argentina.
FC grants to ULBs provide an opportunity to reshape urban health. However, two aspects require attention. First, most municipal bodies lack the technical and managerial capacity to utilize the grants. Building and running a health system requires capacities in governance, contracting, procurement, monitoring, and evaluation. These are complex functions that require sustained support.
One component of a solution to that capacity challenge is to establish a state-level project management units (PMUs) to assist ULBs on technical and managerial matters. The PMU will be responsible for facilitating design elements, developing and executing contracts, and establishing a monitoring framework. Second, the legislation and governance framework on devolution of health to ULBs from state governments is unclear. The 74th amendment increased autonomy of municipal governments. Eighteen categories of functions—listed in 12th Schedule of Article 243W—could be devolved to municipalities at the state’s discretion. One of those is public health. Municipalities can thus implement public health schemes if state governments agree. However, almost three decades since that amendment, most ULBs have a limited role in health. The predominant reason is a lack of devolution of that function by state governments, compounded by inadequate role clarity among various health-related agencies, the poor financial condition of most ULBs, and low priority accorded to health. Further, healthcare is not explicitly mentioned in the 12th Schedule; only public health is. Given the relatively large expected fund inflow from FC grants, state governments can devolve greater authority to ULBs for health. This should be accompanied by a broader conception of public health, in line with the comprehensive primary healthcare vision of HWCs. Else, the money risks sitting idle with ULBs due to a lack of legislative clarity and administrative capacity to deploy it.
Kerala’s experience can provide lessons. In 1996, Kerala granted autonomy to local governments to develop and implement expenditure plans based on local needs. This was accompanied by training and the transfer of 35-40% of the state government’s development budget to local governments.
As urban India’s population swells to over half the total by 2050, a robust health system is necessary to ensure people’s well-being, resilience and productivity. The Union government has shown the will to improve urban health through India’s third tier of government. The key now is to build ULB capacity, and address the nuts and bolts of governance, financing and service-delivery.
These are the authors’ personal views.
Nina Badgaiyan and Anurag Kumar are, respectively, a senior consultant in the field of health and nutrition, and a health economics professional, at Niti Aayog.