The Union Ministry of Health and Family Welfare has released the National Health Account (NHA) estimates for the fiscal years 2020-21 and 2021-22. These reports, marking the eighth and ninth editions of the NHA series, offer a detailed overview of healthcare expenditures across the country. Key findings include a notable rise in government healthcare spending, reduced out-of-pocket expenses for citizens, and an increase in social security investments in health. These trends indicate India’s steady progress toward Universal Health Coverage (UHC) by improving healthcare access, enhancing infrastructure, and reducing financial strain on individuals.
Rising Government Health Expenditure (GHE)
Government spending on healthcare has shown considerable growth over recent years. The share of Government Health Expenditure (GHE) in GDP has increased from 1.13% in 2014-15 to 1.84% in 2021-22. In terms of General Government Expenditure (GGE), healthcare’s share rose from 3.94% in 2014-15 to 6.12% in 2021-22, highlighting the government’s commitment to public health, especially during the COVID-19 pandemic.
In per capita terms, GHE tripled from Rs. 1,108 in 2014-15 to Rs. 3,169 in 2021-22. Between 2020-21 and 2021-22, government health expenditure rose by 37%, a reflection of the proactive measures taken to strengthen healthcare during the pandemic.
Decline in Out-of-Pocket Expenditure (OOPE)
Out-of-Pocket Expenditure (OOPE) on healthcare has long been a financial burden for Indian households. However, between 2014-15 and 2021-22, OOPE’s share of Total Health Expenditure (THE) dropped significantly from 62.6% to 39.4%. This decrease is a direct result of increased public health spending, improved access to healthcare services, and reduced individual financial burdens.
Increased Government Share in Total Health Expenditure
The government’s share of Total Health Expenditure (THE) rose from 29% in 2014-15 to 48% in 2021-22. This rise points to a greater reliance on public health services and a reduced financial burden on citizens. The government’s increased spending has supported the development of healthcare infrastructure and greater financial protection for citizens.
Growth in Social Security Expenditure (SSE) on Health
Social Security Expenditure (SSE) on health also saw an upward trend, increasing from 5.7% of THE in 2014-15 to 8.7% in 2021-22. This growth in social security spending includes government-funded health insurance, medical reimbursements to government employees, and social health insurance programs, providing a safety net that further reduces out-of-pocket costs for individuals.
Total Health Expenditure in 2020-21 and 2021-22
India’s Total Health Expenditure (THE) was estimated at Rs. 7,39,327 crores in 2020-21, accounting for 3.73% of GDP, and increased to Rs. 9,04,461 crores in 2021-22, or 3.83% of GDP. The significant rise in healthcare spending highlights the government’s intensified focus on expanding healthcare coverage and addressing the challenges posed by the COVID-19 pandemic.
The Union government’s share in GHE rose to 41.8% in 2021-22, with state governments contributing the remaining 58.2%. Major government health initiatives, such as the National Health Mission and the Central Government Health Scheme, remained key components of public healthcare spending.
Implications of Increased Government Spending on Healthcare
The consistent increase in government health spending carries several positive implications:
• Reduction of Financial Hardships: The decline in OOPE underscores the government’s focus on financial protection for citizens, making healthcare more accessible and affordable, particularly for low and middle-income families.
• Strengthening Public Healthcare Services: Increased GHE demonstrates the government’s emphasis on improving healthcare infrastructure, expanding access to services, and enhancing quality. Investments have led to better-equipped hospitals, expanded vaccination programs, and improved preventive care.
• Progress Towards Universal Health Coverage (UHC): By boosting healthcare spending, expanding public health programs, and reducing OOPE, the government is making strides towards UHC, ensuring that healthcare services are affordable for all.
• Response to the COVID-19 Pandemic: The sharp rise in health expenditure between 2020-21 and 2021-22 reflects the government’s proactive role in tackling the pandemic, with substantial investments in healthcare infrastructure, testing, treatment, and vaccination.
Understanding Health Accounts
Health Accounts track healthcare expenditures and funding flows within India’s health system. The estimates follow the global System of Health Accounts (SHA) 2011, allowing for inter-country comparisons. The framework categorizes expenditures into Current Health Expenditures (CHE) and capital expenditures, detailing financial flows in the healthcare system, including healthcare financing schemes, healthcare providers, and healthcare functions.
The National Health Account estimates for 2020-21 and 2021-22 provide valuable insights into the evolving landscape of India’s healthcare system. Increased government health expenditure, reduced out-of-pocket payments, and expanded social security spending demonstrate a strengthened and inclusive healthcare system.
As India moves forward, prioritizing public health, these financial investments highlight the government’s commitment to improving healthcare infrastructure and making quality healthcare accessible to all citizens, paving the way for a healthier and more equitable future.
(Input from various sources)
(Rehash/Ankur Deka/MSM)