Guarantee Universal, Affordable and Timely Healthcare for Every Indian

Healthcare should not depend on whether a family can afford a large medical bill, whether an employer provides insurance, or whether a government hospital has capacity when someone becomes sick.

India has expanded public healthcare and government-financed insurance, but financing remains fragmented between government budgets, public insurance schemes, employer-linked programmes, private insurance and household spending. In 2021–22, households still paid 39.4% of India’s total health expenditure directly out of pocket, while government health expenditure was 1.84% of GDP.

The challenge is therefore larger than simply building more government hospitals or expanding insurance.

India needs a healthcare system that answers four basic questions:

Who pays? → What should treatment cost? → Where can a patient receive care? → What happens when the public system does not have capacity?

The objective should be straightforward:
Every Indian should contribute a fair share according to ability to pay and, in return, be guaranteed access to quality, affordable, and timely healthcare.

India should create a universal healthcare system that combines strong public healthcare with regulated private participation and patient choice.

1. Everyone contributes according to ability to pay

Working Indians should make a dedicated healthcare contribution that includes a minimum amount and an income-related percentage.
For salaried workers, it could be collected automatically through payroll, potentially with an employer contribution. Self-employed people and business owners should make an equivalent contribution through the tax system. The government should pay or subsidize contributions for people who cannot afford them.

The actual rates should be determined actuarially:

Define guaranteed healthcare → Estimate its cost → Determine required funding → Set contributions according to ability to pay

Private health insurance should continue. Individuals and employers should remain free to purchase additional insurance, while insurers should be required to make competitive individual and family plans available to self-employed people as well.

2. Establish an independent Healthcare Pricing Commission

An independent Commission should determine transparent reference prices for major treatments and procedures based on the efficient cost of providing quality care.

Government hospitals would operate on cost-based public rates. Private hospitals could have higher Commission rates recognizing their capital costs and reasonable returns.

For illustration only, if the efficient public-hospital price for a procedure were ₹100,000, the Commission might determine that an appropriate participating-private-hospital price is ₹115,000–₹130,000.

The purpose is not to make public and private hospitals identical. It aims to establish transparent, economically sustainable benchmarks for affordable healthcare.

India already has some foundations for this approach. The Clinical Establishments framework includes minimum standards, rate-display requirements, and even a government template for costing medical procedures, although the Act currently applies only in adopting states and Union Territories.

3. Give patients a genuine choice

Citizens should be able to receive treatment through the public system or use private hospitals based on their insurance and coverage.

Government hospitals should be permitted to bill private insurers for insured patients rather than automatically providing the treatment entirely from their general budget.

Public hospitals would therefore receive appropriate base funding for infrastructure and public-service obligations while also earning treatment revenue where applicable.

4. Guarantee timely treatment—not merely a place in a queue

Every major treatment should have a medically appropriate maximum waiting-time standard.

If the public system can provide the treatment within that standard, the patient can receive it there.

If it cannot, the patient should become eligible for treatment through a participating private hospital at the Commission-approved rate.

The guarantee therefore becomes:

Public capacity available → Treat in public system
Public capacity unavailable within standard → Use participating private capacity

Persistent capacity shortage → Expand existing public facilities or build additional capacity

Government should compare the long-term cost of purchasing private capacity against expanding public capacity rather than automatically choosing one or the other.

5. Reward private hospitals that make affordable treatment a substantial part of their business

Government should not simply force every private hospital to charge the public-hospital price.

Instead, private hospitals should be able to qualify for a preferential Public-Service Hospital tax rate when a defined share of their patient-care revenue comes from treatments provided at Commission-approved affordable prices.

The threshold and preferential tax rate should be determined through economic modelling. It could, for example, mean a materially lower corporate tax rate rather than complete tax exemption.
Importantly, the hospital would remain responsible for reaching the threshold.

If a hospital is approaching the required percentage, it has an incentive to offer more procedures at Commission rates and attract more patients:

Offer affordable prices → Attract patients → Increase qualifying revenue → Reach public-service threshold → Receive preferential tax treatment

This converts lower healthcare prices from a government command into an economic incentive.

Different parts of this architecture already operate successfully in other healthcare systems. India can adapt those principles to a system suited to its population and public-private healthcare structure.

Germany demonstrates contribution-based healthcare financing. Its statutory health-insurance system uses income-related contributions; in 2026 the general contribution rate is 14.6%, with employer and employee generally sharing contributions equally, while the government assumes contributions for certain low-income groups. BMG India need not copy Germany’s rates or insurance structure, but it shows that healthcare financing can rise systematically with people’s ability to contribute.

The Netherlands demonstrates that individual insurance does not have to depend on employment. Everyone living or working there must obtain standard health insurance. Insurers must accept applicants for the standard package regardless of age or health, while lower-income people can receive government assistance with premiums. India could apply a similar principle to ensure self-employed families have genuine access to insurance.

England demonstrates that public financing and private hospital capacity can work together. NHS patients can receive treatment from independent hospitals while the NHS pays for the care. In 2024, independent providers treated more than one million NHS patients, and NHS England’s current strategy explicitly calls for greater use of independent-sector capacity to reduce waiting times. NHS England also gives patients choices that can include independent providers paid for by the NHS.

India would go further by connecting these mechanisms to an independent pricing system and incentives for affordable private care.

The complete architecture would be:

Contribute according to ability → Guarantee healthcare for everyone → Set transparent treatment prices → Maintain strong public hospitals → Preserve private insurance and patient choice → Use private capacity when public capacity is unavailable → Reward affordable private care → Expand public capacity where shortages persist

This solution addresses the financing, pricing, access, and hospital-capacity side of healthcare. Ensuring sufficient doctors, nurses, specialists, and other healthcare professionals should be addressed separately as the other side of the healthcare system.

The fundamental bargain should be simple:

Citizens contribute their fair share. In return, the healthcare system guarantees quality, affordable, timely care—whether it is ultimately delivered by a government hospital or a participating private hospital.