Last month, the Pension Fund Regulatory and Development Authority (PFRDA) issued revised guidelines for the registration of the Pension Fund Managers (PFMs). These guidelines are for the PFMs to manage the National Pension System (NPS) in the non-governmental and private sector. See here. The NPS was implemented in 2004 for all government employees and later extended to the private sector in 2009. The guidelines bring about the following changes in the NPS:
Although NPS was made accessible on a voluntary basis to non-government employees and those working in the private sector since 2009, the subscription to the schemes under NPS was lower than expected. In August 2010, a committee was set up under the chairmanship of Mr. G.N. Bajpai to review the implementation of NPS in the informal sector. The Committee noted that since NPS was opened to the general public there were only 50,000 private sector subscribers until May 2011. According to the Committee, the low subscription was due to the low-to-negligible distribution incentive to the PFMs to distribute the different schemes to the subscribers to invest their funds. The Committee thus recommended that PFRDA should consider revising the structure of the NPS so as to increase subscription. It suggested making the fee structure dynamic for PFMs. The Committee had also suggested that there should be some revision in the bidding as well as the selection process for the PFMs to increase competition and thereby incentivise them to distribute the schemes. These changes, as suggested by the Bajpai Committee and now notified by the PFRDA, are different from the original design of the NPS. The Old Age Social and Income Security (OASIS) Report of 2000, which had initially suggested the establishment of pension system for the unorganised sector in the country, had recommended a low-cost structure for the pension system. The Report had stated that the choice of PFMs should be based on a bidding process where the lowest bidder should be made a PFM under the NPS. The rationale for the auction base for the PFMs was that it would provide a system to the subscribers whereby they could make investments for their old age by paying a minimal fee. A set uniform fee was meant to eliminate the large marketing expenses which would ultimately get passed on to the subscibers. In addition, the intent behind keeping the fund managers from the distribution and marketing of the schemes was to prevent any mis-selling (misleading an investor about the characteristics of a product) that may happen. Recent newspaper reports have raised doubt if these new rules would help in increasing the penetration of the NPS in the markets. However, the chairman of PFRDA, Mr. Yogesh Agarwal, in a recent interview explained that it was important to bring about changes in the structure of the NPS. According to him a scheme which was mandatory for the government sector could not be expected to perform as well in the private sector (where it is voluntary) without any changes made to its structure. He also stated that the NPS should be able to compete with other financial products such as insurance and mutual funds in the market. See here for the PRS Legislative Brief on the PFRDA Bill, 2011. Notes: The seven PFMs are LIC Pension Fund Ltd., UTI Retirement Solutions Ltd., SBI Pension Funds Pvt. Ltd., IDFC Pension Fund Management Co. Ltd., ICICI Prudential Pension Funds Management Co. Ltd., Kotak Mahindra Pension funds Ltd., and Reliance Capital Pension Fund Ltd..
Today, the National Medical Commission Bill, 2019 was passed by Lok Sabha. It seeks to regulate medical education and practice in India. In 2017, a similar Bill had been introduced in Lok Sabha. It was examined by the Standing Committee on Health and Family Welfare, which recommended several changes to the Bill. However, the 2017 Bill lapsed with the dissolution of the 16th Lok Sabha. In this post, we analyse the 2019 Bill.
How is medical education and practice regulated currently?
The Medical Council of India (MCI) is responsible for regulating medical education and practice. Over the years, there have been several issues with the functioning of the MCI with respect to its regulatory role, composition, allegations of corruption, and lack of accountability. For example, MCI is an elected body where its members are elected by medical practitioners themselves, i.e., the regulator is elected by the regulated. Experts have recommended nomination based constitution of the MCI instead of election, and separating the regulation of medical education and medical practice. They suggested that legislative changes should be brought in to overhaul the functioning of the MCI.
To meet this objective, the Bill repeals the Indian Medical Council Act, 1956 and dissolves the current MCI.
The 2019 Bill sets up the National Medical Commission (NMC) as an umbrella regulatory body with certain other bodies under it. The NMC will subsume the MCI and will regulate medical education and practice in India. Under the Bill, states will establish their respective State Medical Councils within three years. These Councils will have a role similar to the NMC, at the state level.
Functions of the NMC include: (i) laying down policies for regulating medical institutions and medical professionals, (ii) assessing the requirements of human resources and infrastructure in healthcare, (iii) ensuring compliance by the State Medical Councils with the regulations made under the Bill, and (iv) framing guidelines for determination of fee for up to 50% of the seats in the private medical institutions.
Who will be a part of the NMC?
The Bill replaces the MCI with the NMC, whose members will be nominated. The NMC will consist of 25 members, including: (i) Director Generals of the Directorate General of Health Services and the Indian Council of Medical Research, (ii) Director of any of the AIIMS, (iii) five members (part-time) to be elected by the registered medical practitioners, and (iv) six members appointed on rotational basis from amongst the nominees of the states in the Medical Advisory Council.
Of these 25 members, at least 15 (60%) are medical practitioners. The MCI has been noted to be non-diverse and consists mostly of doctors who look out for their own self-interest over public interest. In order to reduce the monopoly of doctors, it has been recommended by experts that the MCI should include diverse stakeholders such as public health experts, social scientists, and health economists. For example, in the United Kingdom, the General Medical Council which is responsible for regulating medical education and practice consists of 12 medical practitioners and 12 lay members (such as community health members, administrators from local government).
What are the regulatory bodies being set up under the NMC?
The Bill sets up four autonomous boards under the supervision of the NMC. Each board will consist of a President and four members (of which two members will be part-time), appointed by the central government (on the recommendation of a search committee). These bodies are:
How is the Bill changing the eligibility guidelines for doctors to practice medicine?
There will be a uniform National Eligibility-cum-Entrance Test for admission to under-graduate and post-graduate super-speciality medical education in all medical institutions regulated under the Bill. Further, the Bill introduces a common final year undergraduate examination called the National Exit Test for students graduating from medical institutions to obtain the license for practice. This test will also serve as the basis for admission into post-graduate courses at medical institutions under this Bill. Foreign medical practitioners may be permitted temporary registration to practice in India.
However, the Bill does not specify the validity period of this license to practice. In other countries such as the United Kingdom and Australia, a license to practice needs to be periodically renewed. For example, in the UK the license has to be renewed every five years, and in Australia it has to renewed annually.
How will the issues of medical misconduct be addressed?
The State Medical Council will receive complaints relating to professional or ethical misconduct against a registered medical practitioner. If the medical practitioner is aggrieved of a decision of the State Medical Council, he may appeal to the Ethics and Medical Registration Board. If the medical practitioner is aggrieved of the decision of the Board, he can approach the NMC to appeal against the decision. It is unclear why the NMC is an appellate authority with regard to matters related to professional or ethical misconduct of medical practitioners.
It may be argued that disputes related to ethics and misconduct in medical practice may require judicial expertise. For example, in the UK, the regulator for medical education and practice – the General Medical Council (GMC) receives complaints with regard to ethical misconduct and is required to do an initial documentary investigation in the matter and then forwards the complaint to a Tribunal. This Tribunal is a judicial body independent of the GMC. The adjudication decision and final disciplinary action is decided by the Tribunal.
How does the Bill regulate community health providers?
As of January 2018, the doctor to population ratio in India was 1:1655 compared to the World Health Organisation standard of 1:1000. To fill in the gaps of availability of medical professionals, the Bill provides for the NMC to grant limited license to certain mid-level practitioners called community health providers, connected with the modern medical profession to practice medicine. These mid-level medical practitioners may prescribe specified medicines in primary and preventive healthcare. However, in any other cases, these practitioners may only prescribe medicine under the supervision of a registered medical practitioner.
This is similar to other countries where medical professionals other than doctors are allowed to prescribe allopathic medicine. For example, Nurse Practitioners in the USA provide a full range of primary, acute, and specialty health care services, including ordering and performing diagnostic tests, and prescribing medications. For this purpose, Nurse Practitioners must complete a master's or doctoral degree program, advanced clinical training, and obtain a national certification.
