Govt health spending triples, household burden eases

New Delhi: India's government health spending nearly tripled over a decade, while households' share of the country's total healthcare bill fell sharply, pointing to a gradual shift away from out-of-pocket financing towards public funding.

The share of healthcare expenditure borne by households declined to 42.7% in 2023-24 from 64.2% in 2013–14, according to the National Health Accounts (NHA) estimates released by the Union health ministry on Sunday.

“The simultaneous increase in public healthcare financing and decline in the proportion of spending borne directly by households reflects India's progress towards a more accessible, affordable and financially protective healthcare system,” the ministry said in a release.

Government health expenditure rose to ₹4.14 trillion in 2023-24 from ₹1.30 trillion in 2013-14. Its share of total health expenditure increased by 14.9 percentage points over the period, while per capita public health spending rose 2.8 times, from ₹1,042 to ₹2,959.

“The most important development is the changing balance between public and household contributions to healthcare expenditure. A larger share of total healthcare spending is now being financed through government resources, while a considerably smaller share is being borne directly by households,” the ministry said.

Insurance coverage

Primary healthcare received ₹1.53 trillion in government funding, supporting the rollout of Ayushman Arogya Mandirs. These centres offer preventive care, screening for non-communicable diseases, medicines and diagnostic tests at the community level.

Financial protection through health coverage schemes also expanded. Social security expenditure on health, which includes government-funded insurance programmes such as Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB PM-JAY), state health insurance schemes, social health insurance and medical reimbursements for government employees, rose from 6% of total health expenditure in 2013–14 to 11% in 2023–24.

Private health insurance expenditure also increased, accounting for 10.2% of total health expenditure in 2023–24, up from 3.4% a decade earlier.

This reflects deepening health insurance penetration across the country, the release said. "This coupled with the increase in GHE (government health expenditure) provides enhanced financial protection to the public at large,” the ministry noted.

Private health insurance expenditure reached ₹97,167 crore in 2023–24, with employer-provided group policies accounting for ₹55,666 crore and individual policies for ₹41,501 crore. Government-funded insurance schemes, including Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB PM-JAY) and state schemes, accounted for ₹33,385 crore, while social health insurance programmes such as CGHS, ESIS and ECHS accounted for ₹39,078 crore.

The ministry credited several government programmes for lowering treatment costs, including the Free Drugs and Diagnostics Initiatives, the Pradhan Mantri National Dialysis Programme, Pradhan Mantri Bhartiya Janaushadhi Pariyojana, and Affordable Medicines and Reliable Implants for Treatment (AMRIT) pharmacies. Price controls imposed by the National Pharmaceutical Pricing Authority were cited as another measure to make treatment more affordable.

“Together, these initiatives reflect a comprehensive approach combining stronger public investment, affordable medical treatment, primary healthcare expansion and financial protection,” the ministry stated.

The 2023–24 estimates, prepared by the National Health Accounts Technical Secretariat at the National Health Systems Resource Centre, are the eleventh edition of the report and follow the System of Health Accounts 2011 framework.

About the Author

Priyanka Sharma is a journalist at Mint, where she covers the Union Ministry of Health and the pharmaceutical industry. Her work focuses on explaining government policies and how they impact healthcare and the medicine market in India. With 12 years of experience in journalism, she has built a reputation for providing clear and honest news on important health topics that affect the entire country.<br><br>Her educational background includes a journalism degree from the prestigious Indian Institute of Mass Communication (IIMC) and specialized training in public health from the Public Health Foundation of India. Before her current role at Mint, Priyanka worked with India Today, The Pioneer, and ANI. She also served as a lead consultant for the National Health Authority, which gave her firsthand knowledge of how the government manages large-scale health programmes.<br><br>Priyanka is based in New Delhi and is an avid traveller who loves visiting the mountains. She has a great interest in regional flavours, particularly South Indian food.