Despite the expansion of public health insurance in India, households continue to face high out-of-pocket expenditure (OOPE) during hospitalisation. This paper aims to examine whether coverage under the Pradhan Mantri Jan Arogya Yojana (PMJAY) translates into effective financial protection. It analyses who is covered and benefitted from PMJAY, how hospitals have shaped medical spending, and why catastrophic health expenditure (CHE) persists despite large-scale insurance coverage. The study has used unit-level data from the Household Consumption Expenditure Survey (HCES) 2023-24, covering 261,953 households. Expenditures on hospitalization are recorded by using a 365-day recall period, and non-hospital medical expenses are annualised for comparability. The analysis combines descriptive statistics, logistic regression for CHE, log-linear models for OPPE, Lorenz curves to assess inequality and Blinder-Oaxaca decomposition to explain expenditure gaps between PMJAY-covered and non-covered households. The study reveals that PMJAY coverage is 34.1 per cent, with higher enrolment among poorer households (38.6%), Scheduled Tribes (51.1%), rural populations (38.4%), and households with low education (36.9%). However, only 11.8 per cent of covered households received benefits during hospitalization. Further, the average OOPE in private hospitals is INR 48,365 for non-PMJAY hospitalizations, compared to INR 10,225 who utilized PMJAY. Similarly, the incidence of severe catastrophic expenditure (CHE40) is 39.6 per cent among non-PMJAY hospitalizations but 9.6 per cent among PMJAY users. Moreover, disparities in hospitalization costs are evident, especially in private care, and much of the difference between covered and uncovered families is due to differences in economic status rather than insurance coverage alone.
Singh et al. (Tue,) studied this question.