Vaccination: Central control of health care

News: India, in its vaccination process, obtained complete control and power over the doctor-patient relationships. This impacted the vaccination process and also the response of the market. The state should have allowed greater decentralization as the vaccination needs of people are different.

What are the different vaccination needs?

Some people have higher public exposure, have a higher need for vaccination. Choice of the vaccine varies with the person. The precise history of vaccination of each person shapes the optimal choices on boosters.

What were the challenges posed by the centralization of the vaccination process?

Union government obtained complete control of every action. So, other organizations could not make strategies, import vaccines, or determine prices. Therefore, prior to the second wave, a large number of people could not be vaccinated.

What are the benefits of private vaccination?

There is the presence of positive externality, in terms of benefit to society.

First, there is no harm to anyone when a person goes to a private provider and gets the vaccine. This imposes a benefit upon society, by reducing the impact of the virus.

Second, the difficulties are about the people who choose not to buy the vaccine. Here, the state can nudge by providing Vaccine vouchers.

Third, It can result in an undistorted market.

What is the way forward?

Wisdom in public policy lay in respecting the market process as the best part to organize the production side of the economy. The price system would have automatically resulted in better wholesale vaccine availability in India.

Source: This post is based on the article “Central control of health care” published in Business Standard on 27th December 2021.