An idea for entrepreneurial Primary Health Centres in India


Primary Health Centres (PHCs) serve as the principal, and initial, the port of call for people seeking provider help in matters relating to primary care in India. terms it the cornerstone of rural healthcare. According to the National Health Mission constituted under the Ministry of Health and Family Welfare of the federal government, each PHC is supposedto serve up to 30,000 people in “ general areas” and 20,000 people in difficult/tribal and hilly areas. Public health facilities come in three forms: sub-centres (serving up to 5,000 people), PHCs, and community health centres (CHCs – serving up to 120,000 people).

As of March 2016 according to MHFW, there were about 155,000 sub-centres, 25, 300 PHCs, and 5,500 CHCs. The shortfall in PHCs was estimated to be about 22%. Over 9,000 PHCs were reportedly 24×7. They are established and maintained by individual state governments under the basic minimum needs and minimum services program and serve as referral units for 6 sub-centers. PHCs are, well, primary and supposed to cater to primary, or preventive, care needs and staff with a doctor, one or more nurses, attendants, and minimal equipment including a pharmacy. They undertake “ curative, preventive, primitive, and family welfare services”.

The performance of PHCs, in general, have been dismal and this has been brought out by the erstwhile Planning Commission’s evaluation study in 2001. The study identified lack of facilities, under-utilized facilities, absence of lady doctors in most centres, lack of utilization of facilities by beneficiaries owing to inadequate resource availability, mis-match and non-availability of complementary services (especially in obstetric and gynaecological expertise), and general dissatisfaction of beneficiaries with the functioning of the centres.

An untenable position

According to Dr. Aniruddha Malpani in a blog post here, the government spends approximately Rs. 4,000,000 on average on a PHC in the rural areas. As we have noted above, the government’s study confirms that this money has not been well spent, based purely on the quality of deliverables and outcomes achieved. This tells upon other macro healthcare indices: infant and maternal mortality, U-5 mortality, infectious disease incidence, life expectancy, etc. A new index developed to assess achievement on various health indices ranked India 143 out of 188 countries – six positions ahead of Pakistan but way behind Sri Lanka (79), China (92), and Iraq (128). Something is amiss and most fingers point to inadequate, inefficient, unresponsive, and mismanaged health delivery by state resources on the ground. PHCs take the brunt of the blame.

With the emergence of chronic disease in epidemic form, however, PHCs assume significantly greater importance. Study after study now concludes that chronic disease is no longer a “ rich person’s disease” – it affects the poor as much as the rich, the rural dweller as much as the urban, and the illiterate as much as the educated. More importantly, it has been striking at a younger age in the developing world compared to the developed. Cases of cardiovascular disease in India among people in their 30s are no longer a rarity.

In this new circumstance, PHCs have to be redesigned with new responsibilities and more effective and efficient ways of delivery. So far, they have been constituted on a government model that has revealed several weaknesses, accountability is among the most important. Moreover, inadequate funding, staffing, and facilities have hindered effective response at the community level. Four broad areas of focus in the contemporary context should include woman and child, infectious diseases, injury, and chronic disease. While the problems mount, PHCs are finding themselves more and more on the outside, with increasing numbers of rural folk ‘ opting out’ while urban residents have already made their choice with private practitioners and clinics. That is a shame: individual physician offices and clinics, while they have taken on the role of primary care, are not equipped to deal with chronic diseases. And, besides, they entail out-of-pocket expenditure; Indians have become used to it, but why should the poor when the PHCs were created to save them from such expenses?

It is estimated that about 40% of India’s population will live in urban areas by 2025, of which the poor would comprise one-fourth. The urban poor indicators of health, contrary to what one might expect, are in many ways worse than in rural areas: 60% do not receive immunization, 47% of urban poor children are under-weight (45% in rural areas), 59% of women in the 15-49 age group are anemic (57%), and poor child survival rate of 1.3 children dying before the age of 5.

Needed: Radical Model Redesign

These call for a radical departure in how PHCs are setup, organized, managed, incentivized, and run. While the more affluent southern states (and a couple in the north) have decently well-run systems (but of varying quality intra-state), the bulk of the country is bereft of any meaningful primary care that addresses current problems and is prepared for those soon. The persistence of poor healthcare metrics for the nation as a whole emanates from this weak link in the chain.

Below, we discuss an idea that could dramatically infuse new energy and focus to PHCs and make them truly the pillars of Indian healthcare.

1. Let PHCs become entrepreneurial startups

Currently, these are under the domain of the ministry of health in the various states. Broadly, the federal government frames the policies, disburses funds to the states, and the state governments manage the affairs. PHCs are essentially government delivery instruments and all staff automatically employees of the state. While new models are being tried out in some states – the state of Karnataka and Rajasthan, for instance, are experimenting with a few PHCs being “ handed over” or outsourced to non-profit foundations – state ownership and administration largely describes the model. It hasn’t worked.

Instead, each PHC could become a startup and a general practitioner (GP) or a group of GPs given the responsibility to turn it into a successful venture. The government, under an appropriate regulatory body, could define the fees for various services, facilitate easy bank loans for the GP-entrepreneur, and mandate a revenue share arrangement that rewards the entrepreneur-doctor. If the GP-run individual PHC turns out extremely good performance figures (in terms of consumer engagement, clinical encounter, and outcomes howsoever defined) they should be allowed to expand by absorbing or taking over other PHCs, up to some maximum number, together with a mechanism to shrink if performance slips.

2. Involving GPs and giving them the opportunity is important

India graduates about 55,000 doctors every year but severe shortages persist in PHCs (estimated at over 3,000). Five problems confront healthcare in every country in the world:

  1. Too many specialists concentrated in the cities and too few GPs in areas that matter;
  2. Medical education tends to focus around specialties with increasing sub-specialty training in practice;
  3. While primary care is critically important from a public health perspective, it is unglamorous, accorded little respect, and hugely discriminated against in compensation;
  4. Issues of accessibility, availability, affordability, and timeliness are best addressed at the primary care level that specialists are ill-trained for; and
  5. Available GPs are under-utilized, dispirited, severely under-paid, and only too willing to change careers to allied areas where they are paid better (such as backend medical coding for BPOs servicing overseas hospitals, emigrating to jobs in the Middle East and the UK’s NHS, pursuing post-graduate studies where they become specialists, etc).

Most of the above issues, I believe, are addressable in the Indian context with the proposed model that would together solve for both the primary care as well as GP interests. Any idea needs to address the above and make it credible, respectable, and rewarding.

3. Embed “connected health” in every PHC

The newly announced, and yet-to-be-launched, regulatory agency for digital health – the National e-Health Authority (NeHA) – should be leveraged and deeply embedded within the new model of PHCs run by entrepreneurial GPs. However, NeHA itself has to be architected in a way that takes forward the idea of enabling super-easy consumer engagement and experience with doctors and not make it a challenge for them to solve a health problem.

We do not know of the contours of the new agency, but if it is built on lines similar to the “India Stack” now falling into place in the financial sector (standards, protocols, API-based open data access, certification, national switch, portability, ownership, and citizen rights) then there is no reason why a PHC cannot be plugged into this and solve for issues such as:

  • Identity/authentication and record;
  • Trackability, capture conditions, enabling easier diagnosis based on patterns and heuristics;
  • Government healthcare subsidy credits directly into consumer accounts;
  • Health data store and portability;
  • Payment transfers; and
  • Consumer satisfaction that could be assessed through ratings upon end of engagement in a form similar to what Uber has for its drivers

I had described how these could work in an earlier blog here. Such a possibility would elevate a simple PHC with its current focus on immunization, ante-natal checks and injuries to front-line “forward forces” in detection, defense, and generation of heat maps that give forewarning of disease emergence – whether infectious or chronic – and to respond with precision and urgency.

If done in a manner that fully recognizes and incorporates the several frustrations of both the consumer and the GP this has the potential to transform PHCs and ensure quality care is delivered at an affordable cost. Furthermore, the GP could be incentivized in ways that reward for the quality of service and consumer satisfaction.

The Challenges

Many challenges confront such a radical idea. Healthcare in India is a “ state subject” which means the federal government’s responsibilities in how health care is delivered are limited. It creates national-level policies, the regulatory mechanisms, and disburses funds. What happens after is largely a function of the maturity and state of development of each state. The following could be some of the roadblocks that would need attention:

  • Regulation and legislative approval for PHCs to be reformed and reorganized. This may well be seen as “privatization”, a red herring to politicians. However, increasingly state governments are receptive to “entrepreneurship” with its connotations of individual persistence and passion and employment generation. PHCs in the hands of individual GP-entrepreneurs could be seen as a better alternative to large corporate ownership. But a challenge nonetheless.
  • An action plan that combines federal and state agencies to push NeHA’s reach into every PHC and to detail the expected benefits, monitoring mechanisms, and measurement of outcomes at the individual PHC level.
  • A coordinated, well thought out plan to promote GP entrepreneurship with the aim of taking ownership for individual PHCs, qualification and assessment of GP applicants, fast approvals that seek to align GP applicants to geographically distributed PHCs for consideration, single window clearance that brings together applicant approvals to bank loan approvals for defined capex and working capital, well defined clinical standards and metrics for delivery and outcomes, institutional regulatory mechanisms for quarterly or half-yearly health quality assessments of individual PHCs, enabling phone-based tele-consultations, separate engagement metrics for offline and online physician-consumer interactions, clearly defined fee structures for various clinical/lab/pharmacy services that automatically debit consumer health subsidy amounts to the PHC on engagement, defined revenue share in the PHC’s revenues, mandatory continuing education for GPs, and mechanisms for exit or removal in case of mismanagement or malfeasance.


As this blog was being written the federal government is reported to have approved a National Health Policy to provide “ assured health services” to all in the country. According to a news report, “ Health Ministry sources said that in a major policy shift, the policy increases the gambit of sectors covered in the Primary Health Centre (PHC) level and envisages a comprehensive approach.” It further adds that the ministry noted that heretofore, PHCs were only for immunization, anti-natal check-ups and others. But what is a major policy shift is that now it will also include screening non-communicable diseases and a whole lot of other aspects.