Current Affairs


  • Bulk of the total public money spent in State-level healthcare system is not spent on medical services, but goes to wages and salaries of human resource, reveals a study of health accounts of six States.
  • Wages and salaries account for 86 per cent of the total public expenditure in Punjab, 72 per cent in Maharashtra, 65 per cent in Kerala, 52.5 per cent in Madhya Pradesh and 35 per cent in Odisha.
  • However, the per capita ‘total cost of care’ — which includes money spent by patients as well as that spent by the government on paying salaries to staff, for health subsidy etc. — is mostly cheaper in the public sector than in private sector.
  • The only exception is outpatient episode — treatment that does not involve an overnight stay in a hospital — in Maharashtra. The total cost incurred per outpatient episode in the State is more expensive in public sector (Rs. 1,082) than in private sector (Rs.964).
  • In Tamil Nadu, more than 95 per cent patients get free medicines from the government. The cost of public sector outpatient treatment is hence lesser than private in Tamil Nadu because when the government itself procures medicines, it is 300 per cent cheaper than the market. Maharashtra is not doing that and hence the public sector cost is higher.
  • Another finding has important implications for public health policy: in all States studied, the total cost of an inpatient episode — which involves hospitalisation — is much higher in private sector compared to public sector.
  • The bulk of the total money circulating in Indian healthcare (69 per cent) comes from Out Of Pocket (OOP) payment by households. The OOP is the money which individuals pay out of their own. Same was true for health finances at state level.