Healthcare Affordability and Accessibility in India

In 2017, India set itself a health-spending target for 2025. As that deadline arrived, actual spending stood at less than four-fifths of the goal.

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General Science · GenSci0035

43.4%

Out-of-pocket share of India’s health spending, 2022-23

Down from 62.6% in 2014-15

₹5 lakh

PM-JAY cover per family, per year

12.7 cr

Hospital admissions authorised, mid-2026

₹1.52 lakh cr

Saved in out-of-pocket costs (PM-JAY)

16%

NPPA’s trade-margin cap on scheduled drugs

Govt health spending vs. NHP 2017’s own 2025 target1.9% / 2.5% of GDP

A target India set for itself, and missed

The National Health Policy asked for 2.5% of GDP on health by 2025. As that deadline arrived, actual spending stood at 1.9% — real progress, but well short of the goal.

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Must Know

• Out-of-pocket expenditure (OOPE) is money patients pay directly, not through insurance or the government. It’s the main measure of how “affordable” healthcare actually is.
• India’s OOPE share of total health spending has fallen a lot. It dropped from 62.6% in 2014-15 to 43.4% in 2022-23, per National Health Accounts Estimates.
• The main scheme behind this shift is Ayushman Bharat PM-JAY. It offers ₹5 lakh of health insurance cover per family, per year.
• As of mid-2026, PM-JAY has authorised about 12.7 crore hospital admissions. It has saved families over ₹1.52 lakh crore in out-of-pocket costs, per the Economic Survey 2024-25.
• India’s own National Health Policy, 2017 set a target: government health spending at 2.5% of GDP by 2025. As that deadline arrived, actual spending stood at just 1.9%.

Good to Know

• On the drug-pricing side, the NPPA (National Pharmaceutical Pricing Authority) caps trade margins on essential medicines.
• Under the Drug Price Control Order, price-controlled formulations carry a combined retail-distributor trade margin cap of 16%.
• Hospital quality itself is assessed by NABH (National Accreditation Board for Hospitals), under the umbrella Quality Council of India (QCI).
• Parliament’s own Standing Committee heard evidence from all of these bodies. NPPA, QCI, NABH, and the Drugs Controller General of India (DCGI) all testified in a July 2026 session on this exact subject.
• Over 42 crore Ayushman cards had been issued to beneficiaries, as of October 2025.

Test Yourself

Please wait…

1. What does ‘out-of-pocket expenditure’ (OOPE) measure in healthcare?

Insurance premiums paid by employers

The profit margin earned by private hospitals

Money patients pay directly, not through insurance or government schemes

Total government spending on public hospitals

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Great to Know

• Generic medicines are a direct lever on affordability. See IndEco0129 — Jan Aushadhi Scheme: Affordable Generic Medicines in India.
• Who’s actually closing the health-spending gap is a genuine split. Since 2017, state governments have raised their own health spending from 0.67% to 1.1% of GDP. The Union Government’s own share has actually fallen, from a pandemic-era 0.37% to 0.29% in 2025-26.
• The India’s Public Sector Health Care System article covers the structural side of this picture — why public health care leans curative over preventive, and how the Centre-State division of responsibility works.

Current Affairs

• 6 August 2026: The Rajya Sabha’s Department-Related Parliamentary Standing Committee on Health and Family Welfare considered and adopted its 176th Report. The Committee is chaired by Ram Gopal Yadav. The report’s title: “Affordability and Accessibility of Healthcare Facilities in Public and Private Sector.” The Committee made a total of 368 recommendations in the report. (Source: PRS India) (Source: PIB)
• 17 July 2026: As part of examining this subject, the Committee heard oral evidence from the Secretary of NPPA, the chairpersons of QCI and NABH, and officials from DCGI and CDSCO. (Source: PRS India)