Increasing the budgetary allocation to over 2.5 per cent GDP, lowering GST input slabs for healthcare items at or below standard 5 per cent, ensuring viable public administered insurance reimbursement rates, expanding physical and digital infrastructure for both curative and preventive health while lowering duties & GST in cancer therapy treatments to make cancer care more accessible in India
NATHEALTH – Healthcare Federation of India has laid out a bold and strategic framework to reshape the future of India’s healthcare ecosystem. In its recommendations, NATHEALTH emphasises the intrinsic link between national wealth and health. It urges the finance minister to prioritise significant financial commitments in the 2025-26 budget to address the growing burden of communicable and non-communicable diseases, compounded by longstanding challenges, in alignment with the vision for “Visit Bharat 2047.”
NATHEALTH’s recommendations call for a significant increase in healthcare budget allocation to over 2.5 per cent of GDP, with a focus on the following key areas:
- Reducing cancer care costs: Remove customs duties and reduce GST to 5 per cent on oncology radiation equipment, such as LINACs, to expand cancer treatment capacity in underserved regions
- Redirecting public health revenues: Allocate proceeds from healthcare CESS and the proposed 35 per cent GST slab on tobacco and sugar products to strengthen public health programmes. Advocate for a unified 5 per cent GST on all healthcare goods and services to reduce input costs
- Encouraging vertical expansion of hospitals: Permit hospital heights up to 60 metres nationwide (from the current limit of 45 metres), supported by funding for fire safety upgrades to ensure compliance in high-rise healthcare facilities
- Strengthening health infrastructure: Add 2.5–3.0 million hospital beds nationwide through Viability Gap Funding (VGF) and long-term, low-interest capital investments, fostering participation from mid-sized and smaller healthcare providers
- Viable insurance reimbursement rates: Index reimbursement rates under schemes such as CGHS, PMJAY, and ECHS to the Consumer Price Index (CPI) to ensure financial viability, given that many rates have remained unchanged for nearly a decade
- Expanding medical education: Increase MBBS and postgraduate medical seats through government-led investment, supported by alternative financing mechanisms such as loans and interest subventions. Increase tuition fees for private DNB programmes by 75 per cent-100 per cent to fund capacity expansion
- Advancing digital health: Launch a 10-year digital health incentive plan to enable the adoption of Ayushman Bharat Digital Mission (ABDM) infrastructure, enhance data security, implement electronic health record (EHR) systems, and upskill technical resources. Foster collaboration between industry, academia, and start-ups to drive digital innovation
- Promoting India as a healthcare hub: Establish a dedicated fund to position India as a leader in high-quality healthcare and medical tourism, with targeted investments in critical and holistic health services
- Funding R&D in the medtech sector: Announce a fund to support R&D and reward Med-tech innovation in India (including GCC’s) while transitioning to quality linked standardised procurements norms towards value-based care
Abhay Soi, President, NATHEALTH and Chairman & Managing Director, Max Healthcare Institute said, “India’s healthcare sector is at a defining crossroads, presenting both complex challenges and transformative opportunities. The upcoming Union Budget offers an unprecedented chance to address systemic gaps such as the acute shortage of medical specialists, escalating cancer care costs, and inadequate hospital infrastructure to meet the demands of a growing population. By implementing strategic reforms, we can pave the way for a robust, equitable, and innovative healthcare system. Expanding hospital capacity, viable reimbursement frameworks, reducing treatment costs, and advancing medical education will not only address current challenges but also secure India’s position as a global healthcare leader. These efforts will ensure a healthier and more sustainable future for all.”
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