Government health spending rises as out-of-pocket share declines

The latest National Health Accounts estimates show a major shift in India's healthcare financing pattern. Government health expenditure rose from Rs 1.30 lakh crore in 2013-14 to Rs 3.85 lakh crore in 2022-23, while out-of-pocket expenditure as a share of total health expenditure fell from 64.2 percent to 43.4 percent over the same period.

The figures are important because out-of-pocket spending is one of the strongest indicators of financial stress in healthcare. When households pay directly for treatment, medicines or hospitalisation, illness can quickly become a debt shock. A declining share suggests that public spending, insurance coverage and social protection are carrying more of the burden than before.

Government health expenditure as a share of total health expenditure rose from 28.6 percent in 2013-14 to 43.7 percent in 2022-23. As a share of GDP, it moved from 1.15 percent to 1.43 percent under the older GDP series, and 1.48 percent under the new 2022-23 base. Per capita government health expenditure also increased from Rs 1,042 to Rs 2,786.

The report also shows primary healthcare spending by government more than doubling from Rs 0.5 lakh crore to Rs 1.4 lakh crore. That is significant because stronger primary care can reduce pressure on hospitals, detect disease earlier and improve access in rural and low-income communities.

The numbers mark progress, but they do not mean healthcare is inexpensive for families. A 43.4 percent out-of-pocket share remains high for many households, especially where private care dominates or medicines are purchased outside public systems. The increase in private health insurance share also shows changing health-seeking behaviour, but affordability and claim reliability remain important.

The next policy challenge is to make the spending visible in patient experience: shorter waiting times, reliable medicines, better district hospitals, wider screening and less financial fear at the point of care. For readers, the key message is that healthcare financing is improving, but the distance between budget numbers and household relief still needs close tracking.