Role of private hospitals in Kerala : an exploration

This is an attempt to understand the characteristics of private hospitals and the equity in accessing their services, using secondary data available for the period 1986-2004. The data indicates that private hospitals did not expand in numbers but a strong consolidation by large hospitals has taken place. Public policy favouring increased private sector participation in medical education coupled with opening of super specialty hospitals has led to a situation where small hospitals or nursing homes are losing their significance and a large number of them have been phased out. The regional variation in availability of private hospitals is sizeable. The presence of private hospitals is comparatively limited in northern districts of Palakkad, Kozhikode, Malappuram and Kasargod. Annual hospitalisation rates show a rise in demand for hospital facilities across this time period. Rich-poor divide in potential to seek care from private hospitals highest during 1995-96, but declined marginally in 2004. Though the quantum of utilization of private hospitals among poor is similar as rich, it taxes them severely. Overall economic marginalisation of low social groups has further restricted their access to private hospitals. Analysis also shows that the duration of hospitalisation is lesser if treated in a private hospital than in a government hospital and that the charity component in the so called “charitable hospitals” is disappearing. Key Words: Private hospitals, health system, equity, Kerala. JEL Classification: I11, I18, I19, J18