High privatisation in Gujarat's healthcare pushes up out-of-pocket costs: NSS data

By Rajiv Shah  

A new National Sample Survey (NSS) report on household health consumption reveals that private healthcare facilities account for the majority of hospitalisations in Gujarat, placing a significant financial burden on families. 

The survey, the 80th round conducted by the National Statistics Office (NSO) between January and December 2025, shows that nearly two-thirds of all hospital admissions in the state occur in private hospitals, a trend that is reflected across both rural and urban areas.

Key Findings for Gujarat

- Hospitalisation share: Private hospitals handle 59.9% of in‑patient cases in rural Gujarat and 64.6% in urban Gujarat, while government facilities cater for only 37.2% (rural) and 32.2% (urban) of admissions.

- Expenditure side-effect: At the all‑India level, the average out‑of‑pocket medical expenditure per hospitalisation is ₹50,508 in private facilities, compared to just ₹6,631 in government hospitals. This indicates that Gujarat’s heavy reliance on private care is likely driving up households’ medical expenses well beyond the state’s public‑sector average.

- Overall prevalence: The proportion of people reporting illness (PPRA) in Gujarat is 10.7% (rural) and 11.3% (urban), figures slightly below the national averages of 12.2% and 14.9%, respectively.

National Context and Equity Concerns

The pattern in Gujarat mirrors the national picture, where private hospitals account for 59.9% of rural hospitalisations and 64.6% of urban hospitalisations – the exact same percentages as in Gujarat. However, the financial impact is sharper in states where private care dominates. 

Nationally, the median out‑of‑pocket expenditure for a hospital stay is ₹24,000 in a private hospital, compared to just ₹1,100 in a government facility. For poorer households – those in the lowest consumption quintile – the average out‑of‑pocket hospital expense is ₹25,704 in rural areas and ₹25,178 in urban areas, sums that can push families into debt.

Impact on Access and Financial Well‑being

- Inequity: The survey relied on self‑reported ailments, which may lead to under‑ or over‑reporting, but the stark cost differentials are unambiguous. Households that cannot afford private care may either delay treatment or forgo it entirely, while those that do seek care in private hospitals face a much higher risk of catastrophic health spending.

- Financial strain: With two‑thirds of hospitalisations taking place in private facilities, families in Gujarat are disproportionately exposed to high out‑of‑pocket costs. The median expenditure of ₹24,000 for a private hospital admission is 21 times higher than the median of ₹1,100 for a government hospital stay. Such expenses can rapidly erode savings, force borrowing, or lead to asset sales – especially for households in the lower economic strata.

- Public‑health implications: The heavy reliance on private providers also raises questions about the adequacy and accessibility of public healthcare infrastructure. Although near‑universal antenatal care (98% coverage) and institutional deliveries (96.2% nationally) have been achieved, the under‑utilisation of public hospitals for general illness suggests that government facilities may lack the capacity, equipment, or perceived quality to meet all health needs.

Expert Comment

Public health analysts note that while the survey does not provide direct quality comparisons, the high cost of private care creates a two‑tier system. “When more than half of hospital stays occur in private hospitals – at twenty times the cost of public facilities – health equity is seriously compromised,” said a policy researcher. “Strengthening public hospitals and expanding coverage under schemes like Ayushman Bharat are essential to protect lower‑income groups from financial ruin.”

Conclusion

The NSS 80th round survey provides clear evidence that Gujarat – in line with the national trend – has a highly privatised healthcare sector. While private hospitals may offer shorter waiting times and perceived better quality, their high costs impose a heavy financial burden on households, especially the poor. Without stronger public health systems and effective price regulation, the state risks entrenching health inequities and pushing millions into medical poverty.

The NSS report is based on a sample of 1,39,732 households across India and covers morbidity, hospitalisation, child birth, and healthcare expenditure. The estimates are design‑based and subject to sampling errors, which are reported in the document’s appendices.