This chapter discusses health care financing. Financing of health care in India, as elsewhere in the world is viewed in the context of financing of human capital formation; which is the basis of economic and social development of any country. Spiraling costs and rising demands are putting a severe strain on the health system, both public sector as well as the private sector. In India to provide the primary health care had been the responsibility of the Government. Now, it is showing some change in the trend, more and more participation of the private sector is being considered by the Government also. The role of private initiatives is considered important in view of growing concerns about shrinking budgetary support from the government to curative and tertiary health care.