Pattern of Public Healthcare Expenditure and Preparedness for COVID-19 in India: An Interstate Analysis

Abstract

The present study made an attempt to examine the changing pattern of public healthcare expenditure across Indian states for the period 1979–1980 to 2019–2020 and tried to relate this with the spread and mortality of COVID-19 infected cases. An attempt was also made to analyse the responsiveness of per capita public healthcare expenditure (PCPHE) with the change in per capita GSDP (PCGSDP) to a much-disaggregated level. The supply side composite index (SSCI), panel regression and panel generalised method of moments (GMM) was used for analytical purpose. The study found that the greater variation in PCPHE across Indian states start exhibiting since the early years of initiation of NRHM policy and continued till recent years. Unlike the PCPHE, the public healthcare expenditure to GSDP ratio declined for all states in the subsequent time periods. The value of SSCI for both revenue and capital expenditure was low in states having larger populations and geographical areas. The study argued that the average PCPHE across Indian states exhibited irregular pattern of association with the COVID-19 confirmed cases, positivity and death rate. The panel GMM estimate of PCPHE exhibited an inelastic relationship with PCGSDP implying public healthcare is a ‘necessity’ across the Indian states.