Union Budget 2022: Healthcare Industry Seeks Priority Status, Increase in Fund Allocation to 3% of GDP

New Delhi, January 30: The government should look at according priority status to the healthcare segment while increasing the public expenditure on the sector to at least 3 per cent of the GDP in the upcoming Union Budget.

As per the leading healthcare providers in the country in the private sector, the government should also consider continuation of tax incentives, upgradation of medical facilities in smaller towns and skilling of workforce in the Budget.

"The government had rightly placed health and well-being as the first of the six pillars in the Union Budget 2021 and the focus must continue in 2022 too. Firstly, the outlay for healthcare infrastructure to be increased further...facilities in tier 2-3 towns need to be equipped with diagnosis centres, ventilators, ICUs, critical care facilities and oxygen plants," Fortis Healthcare MD and CEO Ashutosh Raghuvanshi noted.

There is an urgent need to allocate a separate budget for a national campaign around preventive health, testing and screening as these are key to reducing the overall disease burden in India, he added. Union Budget 2022: Expectations on Changes in Income Tax Slabs and Rates.

"Healthcare should be accorded priority status so that the sector can derive benefit from the GST transition and providers and healthcare service delivery institutions can avail loans at lower rates and extended tenure. It is also essential that the government reduces duty and cess for critical care and life saving equipment and drugs to reduce costs for both providers and patients," Raghuvanshi said.

Apollo Hospitals Group Executive Vice Chairperson Preetha Reddy said the immediate priorities must include taking up public expenditure on health to at least 3 per cent of GDP, a concerted thrust on encouraging investments that bridge gaps in infrastructure and resources and also efforts to accelerate the adoption of digital technologies.

"These actions are pivotal building blocks of an Atmanirbhar healthcare ecosystem. Also, more than ever before, at this point in time, the people of India are looking to the Union Budget 2022-23 to chart a transformational course in nurturing good health for all and also to be able to access best in class healthcare at all times," she stated.

Apollo Hospitals Group Joint Managing Director Sangita Reddy said that the pandemic has shown the potential of India to become a global centre for R&D in drugs and vaccines.

"Tax incentives should also be extended to R&D as this would encourage further innovation in healthcare. Another key area that the budget needs to address is skilling of healthcare workers. This will help to address the manpower challenge that we face and bring India up to par with the recommended ratio in terms of trained doctors and nurses," she added.

Asia Healthcare Holdings Executive Chairman Vishal Bali said the multiple waves of the pandemic have exposed India's demand – supply gap in healthcare across infrastructure, people, technology.

"Budget' 2022 must remain focused on increased allocation to the healthcare sector and fast track the bridging of the gap. Public healthcare spending on healthcare needs urgent reform and a clear allocation of 2.5 per cent of GDP in real terms and not under a consolidation of allocations to various schemes and departments related to health and sanitation," he noted.

Park Group of Hospitals Managing Director Ankit Gupta said incentives should be provided to the private sector to establish Covid care centres. A medical innovation fund should be set up to provide capital to companies promoting digital healthcare infrastructure, he added.

Ujala Cygnus Group of Hospitals Founder & Director Suchin Bajaj said with the pandemic still around, the focus should be on increasing the healthcare budget. Elaborating further, Pfizer India CFO Milind Patil noted: "We hope the government will rationalise the GST rates, in order to enable reduced cost of treatments for patients. Union Budget 2022-23 Will Be MSME and Export Oriented, Says FIEO.

Since it is planning to merge the GST rates of 12 per cent and 18 per cent, the pharmaceutical products – a majority of which are charged at 12 per cent, while some are charged at 5 per cent – should be taxed at a single merit rate of 5 per cent."

This will reduce the burden of healthcare costs on the middle-income group and help improve affordability, he added. Venus Remedies President (Global Critical Care) Saransh Chaudhary noted that all the material procured by pharma firms for R&D purposes should be exempted from customs duty and GST.