Public Financing of Health Services in India An Analysis of Central and State Government Expenditure

The issue of financing health care has assumed greater significance in the developing world, mainly due to changing role of the state in providing health care. This article examines the levels, trends and patterns of public expenditure on health during 1995 to 2006 in India, both at the national and state levels. We find that public expenditure on health as a proportion of GDP has remained stagnant over the years, and revenue expenditure accounting for the larger share. Among the states, the relatively poor ones were found to be spending more on health, both per capita and as a proportion of GSDP, compared to the richer states. It was seen that expenditure on health by the state had not grown adequately along the path of overall economic prosperity, and private out-of-pocket expenditure seemed to be on the rise. The article cites a few alternative health financing strategies based on recent initiatives across the country, which needs to be reviewed with true intent, aiming equitable, unbiased and universa...