The three most important features of the Indian health care system are:
- Low levels of public spending: Between 1996-97 and 2005-06, total government spending on health was stagnant at about 1 percent of GDP, and the public expenditure elasticity with respect to GDP was at 0.94, lower than the average for low-income countries (1.16) for the same period.
- The inadequate level of public health provision has forced the population to seek private health providers resulting in high OOP spending. OOP spending in India is over four times higher than the public spending on health care.
- A resulting poor quality of preventative care and poor health status of the population
- the wide interstate disparities in revenue capacity make it difficult to ensure comparable levels of public services in different states at comparable tax rates.
Thus, reforms in the health sector will have to address the issue of increasing the allocation to health care, focusing on preventative care, ensuring greater access to health care by the poor and significantly improving the productivity of public spending