Discuss how risk-pooling through government-financed insurance and investment in primary healthcare have changed India's health financing over the last decade. What challenges remain?

The National Health Accounts (NHA) 2023–24 show that households' out-of-pocket expenditure (OOPE) fell from 64.2% of total health expenditure (THE) in 2013-14 to 42.7% [1]. Two policy levers drove much of this fall: pooling through government-financed insurance and spending on primary care. However, families are still not fully protected from health costs.

Risk-pooling through government-financed insurance

• The share of social security expenditure on health in THE rose from 6% to 11%. AB PM-JAY and State insurance schemes drove most of this rise [1].
• Cashless hospitalisation moves inpatient costs, the most catastrophic risk for families, from household budgets to pooled public funds.
• Government health expenditure (GHE) rose from ₹1,29,778 crore to ₹4,14,196 crore. Per capita GHE rose from ₹1,042 to ₹2,959 [1].

Investment in primary healthcare

• Government spent about ₹1.53 lakh crore on primary care in 2023–24 [1]. This money flows through Ayushman Arogya Mandirs for NCD screening, free drugs and free diagnostics.
• Janaushadhi, AMRIT pharmacies and NPPA price control target medicines, the largest item of OOPE [1].
• Prevention lowers future spending on hospital care.

Challenges that remain

• Post-COVID reversal: the OOPE share was 39.4% in 2021-22, when one-time pandemic spending was high [2]. It has since risen back to 42.7% [1].
• Low fiscal effort: GHE was only 1.43% of GDP in 2022-23 [3]. The National Health Policy 2017 target was 2.5% by 2025 [5].
• Leaks in "cashless" care: the CAG's PM-JAY audit found that 69% of patients in Meghalaya paid ₹12.34 crore at discharge. It also found ₹57.53 crore in excess payments in four States and 1,57,176 cases with non-unique beneficiary IDs [4].
• Share is not protection: when THE grows fast, the OOPE share can fall even while the rupees families pay stay the same or rise.
• Federal and spending gaps: health is in the State List, so results depend on State systems. Allocated health funds have also gone unspent [5].

Pooled public money has clearly taken over a large part of what households used to pay. The way forward is to raise GHE towards the NHP 2017 target, tighten PM-JAY empanelment and grievance redressal, and report SDG 3.8.2 alongside the NHA figures. These steps would turn a lower OOPE share into real financial protection, as Universal Health Coverage under SDG 3.8 requires.