IMPACT OF DETERMINANTS OF HEALTHCARE EXPENDITURE IN INDIA: THE ARDL BOUNDS TESTING APPROACH

Despite achieving stable economic growth in the last few decades, India continues to face challenges in healthcare financing, consistently low public health expenditure, and a disproportionately high out-of-pocket burden on households. This study analyses the impact of determinants of per capita out-of-pocket healthcare expenditure and per capita total healthcare expenditure in India from 1991 to 2023.Annual time-series data is analysed using the Autoregressive Distributed Lag Bounds Testing Approach along with co-integrating regression models for robustness check. The results confirm that per capita income, secondary education enrolment, urbanization, inflation rate, life expectancy and per capita total health expenditure have a significant impact both on per capita total health expenditure and per capita out-of-pocket health expenditure in long run. In case of per capita total health expenditure life expectancy and education have the negative impact but in case of per capita out of pocket expenditure inflation rate, per capita income and urbanization have the negative impact. These findings underscore the dualistic nature of Indias health financing system and the need for policy intervention that enhance public funding to ease household financial pressure.