A surge in private insurance premiums has overtaken India’s public health budget, raising concerns over equity and access in the country’s shifting healthcare landscape.
India’s healthcare financing is transforming, with individual health insurance premiums now surpassing the national allocation for the Department of Health and Family Welfare and Health Research. This trend marks a structural shift from public to market-driven healthcare access, as revealed by recent analyses of insurance and budgetary data.
While insurance premium collections dipped after the pandemic, they have since soared, reflecting increased reliance on private coverage. Yet public health spending remains at just around 2% of the Union Budget, well below the 2.5% target. Critics warn that this reliance on private insurance may deepen inequalities, especially for the uninsured and underinsured, many of whom work in the informal sector and lack comprehensive coverage.
Moreover, most private insurance policies exclude outpatient services and rely on hospital-based care, diverting attention from preventive and community-based approaches. Experts argue that insurance should supplement, not replace, a strong public health system, warning against a two-tiered structure that threatens to undermine universal healthcare and long-term wellbeing.
