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HEALTH IS WEALTH

Charted: The astonishing cost of healthcare in India

India-Healthcare-Expensive
Reuters/Punit Paranjpe
This stuff ain’t cheap.
  • Devjyot Ghoshal
By Devjyot Ghoshal

India Editor

This article is more than 2 years old.

Indians are visiting hospitals in higher numbers than at any time in the past—and visiting them more often.

What’s good for their health, though, isn’t necessarily good for their wallets, with healthcare costs rising exponentially in the last decade.

A decade ago, about 31 out of every 1,000 Indians in urban areas were hospitalised (excluding childbirth) every year, according to the National Sample Survey Office’s (NSSO) estimation in 2004.

In 2014, according to the latest NSSO report (pdf), 44 out of every 1,000 Indians end up getting hospitalised in a year.

The trend is similar in rural India, and represents the expansion of healthcare facilities—both public and private—and the population’s increasing ability to access such services.

Up to 42% of rural patients went to public hospitals in 2014, a number that has remained steady since 2004. In urban areas, however, there has been a decided shift towards private establishments.

Most of these hospitalisations are for infections, but a significant number also for treatment for cancer and blood-related diseases.

The increase in access to healthcare has also brought with it a massive spike in costs.

Between 2004 and 2014, for example, the average medical expenditure per hospitalisation for urban patients increased by about 176%. For rural patients, it jumped by a little over 160%.

During the same period, India’s GDP per capita, based on purchasing power parity (current international $), grew by 121%.

There is, however, substantial variation in the cost of healthcare across states, for both rural and urban areas.

Moreover, this ranking hasn’t remained static. The list below consists of the 10 most expensive states for hospitalisation in rural areas in 2004, which have subsequently seen costs grow by anywhere between 83% and 265% over the past 10 years.

State2004 (Rs)2014 (Rs)Increase
Punjab12,75529,779133.47%
Uttarakhand10,73127,883159.84%
Uttar Pradesh9,41720,594118.69%
Himachal Pradesh8,86722,004148.16%
Haryana8,54820,945145.03%
Rajasthan8,29415,60988.20%
Bihar7,41313,62683.81%
Karnataka6,27116,118157.02%
Andhra Pradesh6,23715,411147.09%
Maharashtra6,16022,486265.03%

Such spikes do no favours to India’s massive, uninsured population. Over 85% of Indians in rural areas and 82% of urban residents have no health expenditure support. “On the whole, the poorer households appear unaware or beyond the reach of such coverage, both in rural and urban areas,” the NSSO explained in its report (pdf).

That’s why the Narendra Modi government’s push for the National Health Protection Scheme, which provides a cover of Rs1 lakh per family, as a possible measure to fix India’s creaking healthcare system, makes sense. But given the incredible rise in costs in the last decade alone, Rs1 lakh for a family of four may not amount to much.

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