"South Asia's healthcare crisis demands public investment over market-driven models"
Out-of-Pocket Expenditure (OOPE)
household payments made directly at the point of care, not covered by insurance or public subsidy
Public Good
a good that is non-excludable and non-rival; health's preventive dimension exhibits positive externalities justifying public provision
Health is a State List subject (Entry 6, List II, Seventh Schedule) of the Indian Constitution, placing primary responsibility for healthcare delivery on state governments. Yet the Union exercises substantial influence through Centrally Sponsored Schemes — most prominently the National Health Mission (NHM) — and through national policy frameworks such as the National Health Policy, 2017, which set an aspirational target of raising public health expenditure to 2.5% of GDP. This federal architecture creates a structural tension: states bear the burden of delivery but depend heavily on central transfers to finance it, and most have consistently fallen short of the 2.5% benchmark.
The debate over whether health should be treated as a public good or a market commodity is not new. As political theory recognises, free-market advocates argue that private provision with state-backed purchasing power (insurance, vouchers) is the most efficient route to universal access, while the public-goods tradition holds that health — particularly preventive and primary care — exhibits classic market failures: positive externalities, information asymmetry between provider and patient, and the inability of the poorest to pay. The National Health Policy, 2017 formally endorsed the public-goods framing, committing to a health system anchored in comprehensive primary care rather than insurance-financed curative treatment alone.
The public-goods argument for health rests on a distinction between curative and preventive care. Curative care — treating an individual's illness — is largely a private good: the benefit accrues primarily to the patient, and private markets can, in principle, supply it. Preventive care — immunisation, sanitation, infectious disease surveillance, nutrition programmes — generates positive externalities that the private sector systematically under-provides because it cannot capture the full social return. This is the economic rationale for public investment in primary health infrastructure, and it is the dimension India's spending pattern most conspicuously neglects.
India's public share of total health expenditure has grown to approximately 48%, yet this still lags well behind China, Brazil, and most OECD countries. More critically, the composition of that spending skews toward curative, hospital-based care rather than preventive and primary care. The result is a system where out-of-pocket expenditure (OOPE) — payments made directly by households at the point of care — remains the dominant financing mechanism for most Indians. …
Consider the following statements:
Statement-I: India's public sector health care system largely focuses on curative care with limited preventive, promotive and rehabilitative care.
Statement-II: Under India's decentralized approach to health care delivery, the States are primarily responsible for organizing health services.
Which one of the following is correct in respect of the above statements?
With reference to Ayushman Bharat Digital Mission, consider the following statements:
1.Private and public hospitals must adopt it.
2.As it aims to achieve universal health coverage, every citizen of India should be part of it ultimately.
3.It has seamless portability across the country.
Which of the statements given above is/are correct?
If a commodity is provided free to the public by the Government, then
With reference to India's health financing, consider the following statements:
1.Health is included in the State List of the Seventh Schedule of the Constitution.
2.The National Health Policy, 2017 targets public health expenditure at 5% of GDP.
3.Per-capita out-of-pocket expenditure in India rose by more than 25% over the five years from 2018–19 to 2022–23.
Which of the statements given above is/are correct?
Which of the following best explains why preventive healthcare is considered a 'public good' requiring government intervention, while curative healthcare is more amenable to private market provision?
Consider the following statements regarding India's public health expenditure:
1.India's public share of total health expenditure is higher than that of China and Brazil.
2.Medical inflation in India has been running at approximately 14% annually.
3.Only about 15% of workers in India have employer-supported health insurance.
Which of the statements given above is/are correct?
Assertion (A): Insurance-based health schemes alone cannot substitute for a strong public primary healthcare network in India.
Reason (R): Insurance reimbursement mechanisms channel public funds into private hospital systems without guaranteeing preventive care, community follow-up, or equitable access for the poorest.
Which one of the following is correct?
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