A parliamentary committee has urged India’s health ministry to mandate systematic economic evaluations of widely used Ayush therapies, stating that inadequate standardized data leads to inefficiencies and inflated treatment expenses.
The Department-related Parliamentary Standing Committee on Health and Family Welfare included this recommendation in its 176th report, which assessed the affordability and accessibility of healthcare across public and private sectors. The document points to deficiencies in drug standardization, unstable raw material pricing, and inconsistent insurance coverage for Ayush treatments—encompassing Ayurveda, Unani, Siddha, and other traditional systems.
The committee observed that research bodies like the Central Council for Research in Ayurvedic Sciences (CCRAS), Central Council for Research in Unani Medicine (CCRUM), and Central Council for Research in Siddha (CCRS) have adopted advanced techniques such as high-performance liquid chromatography (HPLC) and centralized instrumentation research facilities (CIRF). Despite these advancements, no uniform requirement exists for pharmacoeconomic studies, which evaluate cost-effectiveness by measuring outcomes like Quality-Adjusted Life Years (QALYs)—a metric combining health benefits with quality and duration.
Without such evaluations, the committee argued, prolonged treatment regimens and unnecessary spending continue unchecked. The report highlighted outdated insurance benchmark rates, which frequently result in claim rejections or excessive patient out-of-pocket expenses. Current 2016 guidelines for insurance coverage of Ayush treatments rely on rates that have not been revised, creating inconsistencies in claim approvals.
The committee’s findings indicate that insurance providers often reject or underpay claims due to non-standardized pricing, leaving patients to fund the remaining costs. To resolve this, the report advises the Ministry of Ayush to finalize and enforce updated benchmark rates within a defined timeframe, ensuring uniform adoption by insurers.
Raw Material Shortages Drive Up Costs
Beyond insurance challenges, the report identified raw material price fluctuations as a primary driver of high Ayush treatment costs. Seasonal shortages, unorganized supply chains, and complex formulation processes lead to price volatility that consumers ultimately bear. While initiatives like the Siddha Medicinal Plants Garden at Mettur Dam and support for MSMEs have been launched, these efforts remain insufficient without a structured approach.
To address cost instability, the committee proposed establishing regional herbal cultivation hubs in collaboration with state forest and agriculture departments. It also called for expanding support to decentralized, GMP-certified MSME pharmacy units, which could ensure a reliable supply of affordable, high-quality raw materials and finished products.
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Existing research centers, such as the Ayush-ICMR Advanced Centres for Integrative Health Research (AI-ACIHR) at AIIMS facilities, have made progress in drug standardization. However, the committee concluded that these efforts remain fragmented. It recommended expanding the AI-ACIHR network to all major tertiary medical colleges to standardize treatment protocols and eliminate ineffective drug variations, aiming to reduce long-term costs through evidence-based integrative approaches.
Ayush Therapies Lack Cost-Effectiveness Evidence
The report shows broader concerns about the limited clinical evidence supporting many Ayush therapies, particularly when compared to conventional medicine. Pharmaceutical drugs undergo rigorous cost-benefit analyses before gaining insurance coverage, but Ayush treatments often lack equivalent data. This gap creates disparities between treatment effectiveness, pricing structures, and reimbursement policies.
Traditional medicine systems in India have historically operated with minimal economic oversight, relying instead on inherited practices. However, as Ayush therapies gain wider adoption—including in government hospitals and private clinics, the absence of standardized economic evaluations has become a critical issue.
The committee’s advocacy for pharmacoeconomic studies aligns with global shifts toward value-based healthcare, where treatments must prove cost-effectiveness to secure ongoing funding and insurance backing. If adopted, these recommendations could transform how Ayush therapies are priced, insured, and prescribed, potentially cutting waste while ensuring equitable patient coverage.
Global Shift Demands Value-Based Healthcare
The report notes that while some states have introduced subsidies for farmers growing medicinal plants, these measures lack coordination with national research priorities.
While the committee acknowledges progress in digital documentation of Ayush practices, it stresses that economic evaluations must go beyond clinical records to include real-world cost data from diverse patient populations.
The report concludes that without action, the growing demand for Ayush therapies could lead to unsustainable financial burdens on patients and insurers alike. It calls for the ministry to prioritize economic evaluations as a first step toward ensuring fair and transparent pricing.
