Government Health Spending Triples, Households' Out-of-Pocket Expenditure Share Falls Sharply: National Health Accounts 2023–24

1. At a Glance

• NHA Estimates 2023–24 are the eleventh round of India's official health accounts. The Ministry of Health and Family Welfare (MoHFW) releases them, and the National Health Accounts Technical Secretariat (NHATS) at the National Health Systems Resource Centre (NHSRC) prepares them using the System of Health Accounts 2011 (SHA 2011) [1].
• Headline 1: households' Out-of-Pocket Expenditure (OOPE) share of Total Health Expenditure (THE) fell from 64.2% (2013-14) to 42.7% (2023–24), a fall of 21.5 percentage points [1].
• Headline 2: Government Health Expenditure (GHE) rose from ₹1,29,778 crore to ₹4,14,196 crore over the same period, about 3.2 times (derived) [1].
• Why it matters: OOPE is the main measure of financial protection and progress towards Universal Health Coverage (UHC). WHO links high OOP payments with catastrophic and impoverishing household spending [8]. The topic covers GS-II (health) and GS-III (public finance).

2. Why in the News

• MoHFW released NHA Estimates 2023–24 showing GHE tripling and the OOPE share falling sharply over 2013-14 to 2023–24 [1]. The digest does not give the exact release date. Check it on the PIB page.
• The previous round, NHA Estimates 2020-21 and 2021-22, was published as a PIB document in October 2024 [4].
• In 2025 WHO published a technical document, Tracking out-of-pocket health expenditure under SHA 2011, to improve how countries estimate OOP spending [6].

3. Background & Evolution

• Rationale: NHA tracks who pays for health (government, households, insurance), on what, and through which channels. It tells policy where financing is shifting [1].
• Framework: SHA 2011 is an integrated, comprehensive method for tracking health spending used across countries. Its data feed WHO's Global Health Expenditure Database (GHED) [7].
• Milestones (successive NHA rounds):
• 2017-18 round: per capita OOPE fell from ₹2,336 (2013-14) to ₹2,097 (2017-18) [3].
• 2018-19 round: in 2022, MoHFW publicly rejected a media report that questioned these estimates and said they show a substantial reduction in OOPE [5].
• 2019-20 round: OOPE share of THE fell from 62.6% (2014-15) to 47.1% (2019-20), which the release linked to higher public spending [2].
• 2020-21 and 2021-22 round: released in October 2024 [4].

• 2023–24 (11th round): OOPE at 42.7%, GHE at ₹4,14,196 crore, per capita GHE at ₹2,959 [1].

• Related programmes: AB PM-JAY, Ayushman Arogya Mandirs, Free Drugs and Diagnostics Initiatives, PM National Dialysis Programme, PM Bhartiya Janaushadhi Pariyojana, AMRIT pharmacies, and price regulation by the National Pharmaceutical Pricing Authority [1].

4. Core Static Facts

Definitions [1]:

• THE: health spending from all sources. It is the denominator for every share in the table.
• GHE: public spending on health.
• OOPE: direct payments by households at the point of care that no scheme reimburses.
• SSE: organised protection arrangements. These cover government-financed insurance (AB PM-JAY and State schemes), social health insurance, and medical spending on government employees.
• Private health insurance: voluntary insurance that people buy themselves.
• Primary healthcare: preventive and promotive care, NCD screening, and essential medicines and diagnostics at community level, delivered through Ayushman Arogya Mandirs.

Statutory basis: NHA is an administrative statistical exercise with no enabling Act. Health is in the State List of Schedule VII (static knowledge, not from the sources).

5. Multi-Dimensional Analysis

Economic / Fiscal

• GHE grew about 3.2 times in nominal terms over 10 years [1]. Read this against inflation and GDP growth, since the figures are not real terms.
• About ₹1.53 lakh crore went to primary healthcare [1]. Prevention is cheaper than hospital care, so this lowers future costs.
• The SSE share rising from 6% to 11% means more spending is pooled, which spreads financial risk [1].

Social / Equity

• A lower OOPE share protects poor households most, because they face the highest risk of catastrophic spending [8].
• Cashless hospitalisation under PM-JAY and cheap medicines through Janaushadhi and AMRIT target the biggest OOPE items: drugs and inpatient care [1].
• A falling share can hide rising absolute OOPE when THE itself is growing. Read equity claims with care.

Governance / Data integrity

• The estimates are contested. In 2022 MoHFW had to rebut media doubts about the 2018-19 round [5].
• WHO's 2025 guidance exists because OOP estimation methods vary in quality [6]. In India, OOPE estimates rely on household consumption surveys.

Administrative / Federal

• Health is a State subject, so GHE combines Union and State spending. PM-JAY sits alongside separate State-specific schemes [1].
• Ayushman Arogya Mandirs deliver primary care, so how well they work depends on State health systems [1].

Health-systems / UHC

• Pooled financing (GHE, SSE and private insurance) replacing household payments is the standard route to UHC [1][7].

6. Recent Developments (last 12-18 months)

• 2025: WHO published Tracking out-of-pocket health expenditure under SHA 2011 (ISBN 978-92-4-011488-3) [6].
• 2023–24 NHA (11th round): MoHFW released it, reporting OOPE at 42.7%, GHE at ₹4,14,196 crore and SSE at 11% [1].
• Background, October 2024: the combined NHA 2020-21 and 2021-22 estimates were released [4].

7. Prelims Hooks

• NHA estimates are released by MoHFW and prepared by NHATS at NHSRC [1].
• NHA follows the System of Health Accounts 2011 framework [1][7].
• NHA 2023–24 is the eleventh round [1].
• OOPE share of THE was 42.7% in 2023–24, down from 64.2% in 2013-14 [1].
• That is a fall of 21.5 percentage points, not 21.5% [1].
• GHE in 2023–24 was ₹4,14,196 crore, up from ₹1,29,778 crore in 2013-14 [1].
• Per capita GHE in 2023–24 was ₹2,959, up from ₹1,042 [1].
• The SSE share of THE rose from 6% to 11% [1].
• SSE includes medical spending on government employees and government-financed insurance such as PM-JAY [1].
• Government spending on primary healthcare in 2023–24 was about ₹1.53 lakh crore [1].
• The 2019-20 round put OOPE at 47.1%, down from 62.6% in 2014-15 [2].
• The 2017-18 round put per capita OOPE at ₹2,097, down from ₹2,336 [3].
• WHO's OOP indicator uses Current Health Expenditure as the denominator, not THE [8].
• SHA 2011 data feed WHO's Global Health Expenditure Database [7].

8. Why 42.7% Is Actually Higher Than Two Years Earlier

• The note's open question is now settled: 39.4% is an official figure
• The official NHA release for 2020-21 and 2021-22 says the OOPE share of THE fell to 39.4% in 2021-22 [9].

• In the same year, the government's share of THE was 48%, and GHE was 1.84% of GDP (GDP is the total value of everything the economy produces in a year) [9].

• So between 2021-22 and 2023-24, families paid a bigger share, not a smaller one

• OOPE share: 39.4% (2021-22) → 42.7% (2023-24). That is a rise of about 3.3 percentage points (derived from [9] and [1]).
• Government share: 48% (2021-22) → about 43.5% (2023-24, derived in the note) [9][1].

• The 2023-24 headline hides this by comparing only with 2013-14.

• Why it went up: COVID money was a one-time boost

• The 2022-23 release says the extra government spending in 2021-22 was a one-time COVID response. That temporary spending is what pulled the OOPE share down to 39.4% [10].
• When that money stopped, GHE fell to 1.43% of GDP in 2022-23 (1.48% on the new GDP series with base year 2022-23) [10].

• So 2021-22 was a peak caused by the pandemic. It does not show the normal level of spending.

• How to write this in Mains

• Say both things: OOPE has fallen a lot over ten years [1], but some of the COVID-era gain has been lost [9][10].
• An examiner gives more credit to an answer that notices the trend than to one that repeats the headline.

9. Why a Smaller Share Does Not Mean Families Pay Less

• A share depends on the total, not only on what families pay
• OOPE share = household payments ÷ THE.
• If government spending grows fast, THE grows too. Then the share falls even if families pay the same amount of rupees as before, or more.

• So the falling share mostly shows that more public money came in. It does not show, on its own, that any one family's medical bill got smaller.

• The global measure of financial protection is a different number: SDG 3.8.2

• SDG 3.8.2 counts the people whose health bills take too large a part of their household budget. It does not measure shares of national spending.
• Under the revised definition proposed by WHO and the World Bank in 2024, a family faces hardship when its out-of-pocket health spending is more than 40% of its discretionary budget (the money left after basic needs such as food) [11].
• On this measure, WHO's 2025 India profile puts 30.9% of people, about 44 crore, in financial hardship because of health spending [11].

• On the older measure (health spending above 10% of the household budget), WHO's 2024 profile gives 17.5% [12]. The two figures use different rules, so do not compare them directly.

• What this means

• A national OOPE share of 42.7% can sit alongside tens of crores of people under financial strain.
• The NHA tells us who pays in total. SDG 3.8.2 tells us who gets hurt. A UHC answer needs both.

10. Where 'Cashless' Insurance Still Makes Patients Pay

• The note counts PM-JAY as pooled money. The CAG found that pooling does not always reach the patient
• CAG Report No. 11 of 2023 is a performance audit of AB PM-JAY covering September 2018 to March 2021 [13].

• A performance audit is CAG's check of whether a scheme actually works, not just whether the accounts add up.

• Patients paid at discharge even though the scheme is cashless

• In Meghalaya, 13,418 patients (69%) paid an extra ₹12.34 crore when they left hospital [13].

• That money is OOPE, but in the NHA it sits next to a scheme that is meant to remove it.

• People can have a card and still have no hospital nearby

• There were very few empanelled hospitals (hospitals approved to treat PM-JAY patients) per lakh beneficiaries in Assam, Maharashtra, Rajasthan and Uttar Pradesh [13].
• In Andhra Pradesh, 524 of 1,421 empanelled hospitals made zero claims [13].
• Some hospitals were approved without anyone visiting them, or did not have the specialties they were listed for [13].

• A patient who cannot find a working PM-JAY hospital goes to a private one and pays from their own pocket.

• Some money went to the wrong people or in the wrong amounts

• The audit found ineligible households in six States/UTs, invalid names and impossible dates of birth in the database, and PM-JAY IDs that were not unique in 1,57,176 approved cases [13].
• Four States made excess payments of ₹57.53 crore to hospitals [13].

• In five States/UTs, the State Grievance Redressal Committee never met [13]. That left patients who were charged nowhere to complain.

• Why this matters for reading the SSE share

• The SSE share rose from 6% to 11% [1]. But money spent on wrong beneficiaries or overpayments is counted as protection even though no patient was protected.
• The CAG still said the scheme had a strong positive effect on the economically weaker sections [13]. The problem is how money leaks along the way, not the idea of pooling.

11. How Far India Is From Its Own Spending Target

• The target in the National Health Policy 2017 (NHP 2017)

• NHP 2017 says Union and State public health spending together should reach 2.5% of GDP by 2025 [14].

• Where spending actually stands

• 1.84% of GDP in 2021-22, which was the COVID peak [9].
• 1.43% in 2022-23, or 1.48% on the new GDP series [10].
• That is about one percentage point short of the target, after the 2025 deadline.

• PRS's analysis of the 2025-26 health budget concludes that budget allocations fall short of policy targets [15].

• Why '3.2 times' and '1.43% of GDP' can both be true

• GHE grew about 3.2 times in rupees [1]. But GDP also grew a lot in rupees over the same ten years.

• The share of GDP shows the effort compared with the size of the economy. That is the number the target uses.

• Unspent money is a second problem, separate from the size of the budget

• The Parliamentary Standing Committee said poor planning of time and cost left allocated health funds unused [14].
• The CAG found that PM-JAY's administrative grants have stayed unspent ever since the scheme began [13].
• So raising the budget will not help much if the money that is allocated does not get spent.

12. The Strongest Case Against the Headline, and an Honest Answer

• The objection
• Critics say OOPE is estimated from household surveys, and the method keeps changing [6]. Each release also uses a different base year (2013-14 in [1], 2014-15 in [2]).
• The most flattering comparison makes the progress look larger than it is.

• MoHFW has already had to defend an earlier round in public [5]. Hardship numbers like 30.9% [11] suggest families do not feel the fall.

• What the objection gets right

• Starting from a 2013-14 base hides the rise from 39.4% to 42.7% after COVID [9][1].
• A share is not the same as protection (see the SDG 3.8.2 section above) [11].

• The CAG found OOPE inside a cashless scheme [13]. So pooled money does not turn fully into lower bills.

• What it gets wrong

• The main direction does not depend on the method. Government's share of THE rose from about 29% in 2014-15 to 48% in 2021-22 [9]. GHE grew about 3.2 times by 2023-24 [1]. This is budget money, not survey guesswork.

• The fall shows up in every release, each with different base years: 64.2% → 42.7% [1] and 62.6% → 47.1% [2].

• A fair verdict

• Public money has taken over a large part of what families used to pay. That is real.
• How much this has protected families, and whether it lasts after COVID, is still unproven.
• Use this balance in 'critically examine' questions.

13. What Should Follow, and Who Should Do It

• MoHFW and NHSRC (the National Health Systems Resource Centre) should publish the full yearly series, not just two endpoints
• Each release should show every year, including the 39.4% COVID low [9], and should say clearly whenever an earlier year's figure has been revised.

• Readers could then see whether progress is continuing or going backwards.

• The NHA release should report SDG 3.8.2 alongside the OOPE share

• WHO already publishes India's figure on catastrophic and impoverishing spending [11][12].
• Putting the two together would show both who pays (NHA) and who suffers (SDG 3.8.2).

• WHO's 2025 OOP guidance gives a common method for measuring OOP consistently [6].

• The National Health Authority, which runs PM-JAY, should fix the leaks the CAG found [13]

• Visit hospitals in person and check their specialties before approving them.
• Stop payments at discharge, as in Meghalaya, and make sure State Grievance Redressal Committees actually meet.

• Clean the beneficiary database of duplicate IDs and ineligible names.

• The Union and the States should agree a path to the NHP 2017 target of 2.5% of GDP [14]

• Health is a State subject, and most of the money still has to come from the States.
• The Union should link part of its grants to States raising their own health spending, and also to States spending what they were allocated [14][15].

14. Anchors for Answers

• Data: OOPE share 39.4% in 2021-22, compared with 42.7% in 2023-24. The fall since 2013-14 is real, but the post-COVID trend is going back up [9][1]
• Data: GHE 1.84% of GDP (2021-22) → 1.43% (2022-23), against the NHP 2017 target of 2.5% by 2025 [9][10][14]
• Data: 30.9% of Indians (about 44 crore) face financial hardship from health spending under the revised SDG 3.8.2 [11]
• Report/Committee: CAG Report No. 11 of 2023, Performance Audit of AB PM-JAY. 69% of patients in Meghalaya paid ₹12.34 crore at discharge; ₹57.53 crore excess payments in four States [13]
• Report/Committee: Parliamentary Standing Committee on Health: poor planning of time and cost left health funds unused [14]
• Law/Case: Health is in the State List (Schedule VII). Public health and hospitals are a State responsibility, which is why GHE adds up Union and State spending
• Scheme: AB PM-JAY is the main driver of the SSE share rising from 6% to 11%, and also the scheme where the CAG found OOPE still being charged [1][13]

15. Mains Relevance

• GS-II: issues relating to the development and management of the Social Sector/Services relating to Health. Also government policies and interventions, and welfare schemes for vulnerable sections.
• GS-III: Indian economy and mobilisation of resources, government budgeting, and inclusive growth.
• Possible question stems: 1. "The fall in the share of out-of-pocket expenditure in India's total health expenditure is necessary but not sufficient for financial protection." Critically examine this in light of the NHA 2023–24 estimates. 2. 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? 3. Health is a State subject, yet Union schemes shape health financing outcomes. Analyse the federal dimension of India's progress towards UHC.

16. Related Topics to Study Next

• AB PM-JAY: the main driver of the rising SSE share.
• Ayushman Arogya Mandirs (former HWCs): where primary-care spending is delivered.
• National Health Policy 2017: sets the target for public health spending as a share of GDP (check the figure in the policy text).
• PM Bhartiya Janaushadhi Pariyojana and NPPA drug price control: they address medicines, the largest OOPE item.
• Catastrophic health expenditure and SDG 3.8.2: the global measure of financial protection.
• Fifteenth Finance Commission health-sector grants: fiscal transfers to local health bodies.
• WHO GHED and SHA 2011: needed for cross-country comparisons.
• Household consumption expenditure surveys (MoSPI): the data source behind OOPE estimates.

17. NCERT Concepts to Revise

• National Health Accounts (Economy): The core source of the article: official estimates of who pays for India's health spending.
• Out-of-pocket expenditure (Economy): The headline indicator, the share of health costs families pay directly, falling from 64.2% to 42.7%.
• Universal health coverage (Economy): OOPE is the main yardstick of financial protection on the path to universal health coverage.
• Catastrophic health expenditure (Economy): Explains why a falling OOPE share can coexist with many households facing financial hardship.
• Ayushman Bharat PM-JAY (Economy): The government insurance scheme driving the rise in pooled social security spending on health.
• National Health Policy, 2017 (Economy): Sets the 2.5% of GDP public health spending target against which actual spending is judged.
• Health expenditure (Economy): Basic concept of what health spending covers and why it matters for human capital.
• Gross Domestic Product (Economy): Public health spending is judged as a share of GDP, not just in rupees.
• Sustainable Development Goal 3 (Economy): SDG 3.8.2, the global measure of financial hardship from health costs, sits under this goal.
• Performance audit (Polity): The CAG's performance audit of PM-JAY found patients still paying and money leaking.
• State List (Polity): Health is a State subject, so health spending combines Union and State money.
• PM Bhartiya Janaushadhi Pariyojana (Economy): Cheap generic medicines target drugs, the largest item of household health spending.
• National Health Authority (Polity): Runs PM-JAY and is the body asked to fix the leaks the audit found.
• Base year (Economy): Comparisons from different starting years (2013-14 versus 2014-15) change how the fall looks.

18. Common Errors / Trap Areas

• Percentage points vs percent: OOPE fell by 21.5 pp. The GHE share rose by 14.9 pp, which is a ~52% relative rise [1]. MCQs mix these up deliberately.
• Denominators: the NHA figures quoted here use THE [1], while WHO's indicator uses CHE [8]. Do not compare the two directly.
• Baseline years: the 2023–24 release uses 2013-14 as its base (64.2%) [1]. The 2019-20 release used 2014-15 (62.6%) [2].
• Track the trend, not just the endpoints: secondary coverage reports OOPE at about 39.4% and the GHE share at about 48% for 2021-22. That would make 42.7% in 2023–24 a rise from the COVID-era low. I could not confirm 39.4% in a Tier 1 source, so check it against [4] before using it.
• Who does what: the estimates are prepared by NHSRC/NHATS under MoHFW, not by NITI Aayog or MoSPI [1]. SSE is not the same as private insurance: the first is organised or financed by government, the second is bought privately [1].