Hospitalised Care among Larger States

Though the global spending on health is rising worldwide, people were still paying too much out of their pockets. This article examined the comparative expenditure on hospitalised care in India using three rounds of the National Sample Surveys. As there is low footfall in public facilities, the Government of India needs to take necessary measures to strengthen the public health system.

The authors are extremely grateful to Alok Kumar, adviser (health), NITI Aayog for his guidance and valuable suggestions to improve on the earlier draft.

Health spending consists of government expenditure, out-of-pocket (OoP) payments, and other sources, such as voluntary health insurance, employer-provided health insurance and activities by non-profits organisations, non-governmental organisations (NGOs), and other enterprises. The total expenditure on health from all public, private and donor sources amounted to $7.5 trillion in 2016, which represents close to 10% of the global gross domestic product (GDP), with almost the similar proportion of health expenditure (10%) being incurred from 2000 (WHO 2019). However, in low- and middle-income countries, health spending is undergoing a transformation. The reliance of people on public funding has increased. In most regions, the reliance on OoP spending is gradually going down and has also been associated with a reduction in the share of domestic government revenues allocated to health.

In low-income countries, public health spending represents only 1.5% of GDP in 2016. On the contrary, public health expenditures accounted for 6% of GDP in high-income countries and over 3.5% of GDP in upper-middle-income countries. Less than 40% of primary healthcare costs are funded by the government or other domestic public sources—meaning that either donors or users have to pay out of their pockets for many of the most basic health services essential to prevention and treatment such as vaccines or maternal and newborn care. Inpatient and outpatient curative care and medicines also account for 70% of total global health spending, leaving little money for prevention, which gets only about 12% of total spending and 11% of public funds (WHO 2019).