‘Inadequate govt spending transferring burden of healthcare onto households’

NEW DELHI: As preparations gathered pace for the Union Budget 2026–27, a new research study on public health financing, stated that inadequate government spending has been transferring the burden of healthcare onto households and widening inequalities. The study, titled “Impact of Determinants of Healthcare Expenditure in India: The ARDL Bounds Testing Approach”, published in the International Journal of Advanced Research in December 2025 and circulated this year, examined national data spanning 1991 to 2023 to identify the factors shaping healthcare expenditure in India, including per capita spending and household out-of-pocket payments. Using advanced econometric techniques, the authors found that income growth, urbanisation, education levels, inflation and rising life expectancy has statistically significant long-term effects on healthcare spending. These socio-economic shifts, the study noted, are closely associated with higher healthcare consumption, particularly through private expenditure borne directly by families.

According to the research, India’s development trajectory is structurally pushing healthcare costs upward, with limited public provisioning leaving households increasingly exposed to financial risk. The paper drew attention to the country’s persistent dual health financing system, characterised by low public spending alongside heavy reliance on private out-of-pocket payments. This imbalance entrenches inequality in access to care, with rural and lower-income households facing a higher risk of catastrophic medical expenditure and delayed treatment. “Without stronger public financing, the burden of illness continues to fall most heavily on those least able to afford it,” the study concludes.