"India's Healthcare Expansion Masks Chronic Public System Underfunding"
Out-of-pocket expenditure (OOP)
health costs paid directly by patients, not covered by insurance or government schemes
Marketisation of healthcare
growing role of private capital and commercial providers in delivering and financing health services
Health is a state subject under the Seventh Schedule of the Constitution. States are primarily responsible for organising health services and delivering care. The Centre plays a supporting role through centrally sponsored schemes and national health programmes. This decentralised structure means that the quality and reach of public healthcare varies sharply across states.
The National Health Policy, 2017 set a target of raising government health expenditure to 2.5 per cent of GDP. India has consistently fallen short of this target. In 2022-23, actual government health expenditure stood at only 1.43 per cent of GDP. This chronic underfunding has a direct consequence: the public system focuses largely on curative care, with limited investment in preventive, promotive, and rehabilitative services. The Parliamentary Standing Committee on Health and Family Welfare has repeatedly flagged this gap between policy ambition and budgetary reality.
India's public health architecture rests on a three-tier structure: sub-centres, primary health centres, and community health centres at the district level, with district hospitals above them. The National Health Mission (NHM), launched to strengthen this structure, has improved coverage in many states. However, specialist shortages, infrastructure gaps, and uneven implementation have left the system unable to meet rising demand, particularly in rural areas.
The marketisation of healthcare refers to the growing role of private capital, commercial providers, and insurance mechanisms in delivering and financing health services. In India, more than 60 per cent of hospitalisations and around 70 per cent of outpatient care are now serviced by the private sector, according to the NSSO 80th Round (2025). This is not simply a matter of consumer preference. It reflects the failure of the public system to provide a credible alternative.
The cost differential between public and private care is stark. Average hospitalisation expenditure is approximately Rs 6,631 in government hospitals against Rs 50,508 in private hospitals. When the public system cannot absorb demand, patients are effectively pushed into private care at eight times the cost. The state does not need to charge a patient directly to impose a financial burden. It only needs to fail to provide a realistic public option.
Ayushman Bharat PM-JAY is the government's primary instrument for financial protection. It is one of the world's largest publicly funded health insurance programmes, providing cashless hospitalisation cover to eligible families. …
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?
With reference to Ayushman Bharat Digital Mission, consider the following statements:
1.Private and public hospitals must mandatorily adopt it.
2.It aims to achieve universal health coverage by enrolling every citizen of India.
3.It provides seamless portability of health records across the country.
Which of the statements given above is/are correct?
Consider the following statements regarding India's public healthcare system:
1.Government health expenditure as a share of GDP met the National Health Policy 2017 target of 2.5% by 2022-23.
2.Under India's decentralised approach, States are primarily responsible for organising health services.
3.Out-of-pocket expenditure accounted for more than 40% of total health expenditure in 2022-23.
4.More than 60% of hospitalisations in India are serviced by the private sector.
How many of the above statements are correct?
Match the following with reference to India's healthcare financing:
List I (Indicator) — List II (Value/Description)
A.Government health expenditure as % of GDP (2022-23) — 1. 43.4%
B.Out-of-pocket expenditure as % of total health expenditure (2022-23) — 2. 1.43%
C.NHP 2017 target for government health expenditure as % of GDP — 3. Rs 50,508
D.Average private hospitalisation expenditure — 4. 2.5%
Consider the following statements regarding medical education and rural health infrastructure in India:
1.India currently has more than 800 medical colleges with over one lakh undergraduate MBBS seats.
2.Specialist shortages at rural community health centres are estimated at roughly 70-80 per cent.
3.All sub-centres in India have their own dedicated buildings.
4.Health is a Concurrent List subject under the Seventh Schedule of the Constitution.
Which of the statements given above is/are correct?
Which of the following best describes the concept of the 'missing middle' in the context of India's healthcare financing?
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