Single Blog Title

This is a single blog caption

Healthcare Financing in India – Challenges and Solutions Ahead

10 August 2017, New Delhi, India

Over the past few years, India’s disease profile has changed drastically from communicable to non-communicable diseases, which now account for 53% of the disease burden and 60% of total deaths in the country. However, India’s spend on healthcare still stands at a little more than 1% of GDP. The global evidence on health spending shows that unless a country spends at least 5-6% of its GDP on health and the major part of it is from government expenditure, basic healthcare needs are seldom met.

NCDs are costly in terms of both human suffering and economics. According to the WHO, nearly 39 million Indians are pushed to poverty because of ill health every year. Also, about 47% and 31% of hospital admissions in rural and urban India were financed by loans and sale of assets.

The failure of public investment in health is reflected in the worsening situation in terms of costs of care and impoverishment due to rising healthcare costs. Because of the limited availability of healthcare coverage and low public expenditure on health in India, an estimated 60-70% of healthcare services are paid out-of-pocket, often driving many to poverty. Given the reliance on out-of-pocket costs, preventive care and early opportunities to manage health risks are often forgone, leading to greater severity of disease, higher costs for the individual, and significant economic losses for society as a whole.


Healthcare in India suffers from serious mismatch between declared objectives versus actual reality and within that, health care financing does not figure in the consideration set amongst policymakers. The situation is further amplified due to factors such as:

  • Healthcare financing is not recognized as key to the political agenda
  • Lack of understanding and support for healthcare financing from masses as well as KOLs
  • Lack of business focus (reflected in building larger consumer base through innovative product development and marketing) by commercial insurance companies
  • Absence of model that can be adapted in the Indian context

Roundtable Discussion on Healthcare Financing “Innovative Financing Mechanisms to Improve Health Coverage in India” is taking place on the August 10th 2017, New Delhi.

Leave a Reply