Health sector reform is defined as sustained, purposeful change to improve the efficiency, equity and effectiveness of the health sector. Any change is not reform. Changes that affect at least two of the elements namely; health financing, expenditure, organization regulation and consumer behavior justify to be called as health sector reforms. Suggested reforms before introduction must undergo a feasibility and implementation analysis which includes the following components: implementability, political feasibility and political controllability. Health sector reforms in India were a direct outcome of the economic reforms post 1991. Economic reforms sought to achieve rapid economic development. It was thought that this effect would trickle down to health sector, which did not happen. Opening up of markets resulted in expansion of private health sector in India which largely remains unregulated. Even though evidence was available that market based health sector reforms were not able to achieve equity, it was pursued. Many states in India went for loan under the structural adjustment programme of the World Bank. User fee was introduced and free medical care was revoked. These changes in health financing only or donor driven changes that were non purposive are not health sector reforms in true sense. Decreased health spending, with decreased public health spending, inefficient expenditure of public spending, poor primary and secondary health care, high out of pocket expenditure, user fees, unregulated private sector and low financial protection all have led to failure of primary health care which has been replaced by market based health sector reforms. Market based health sector reforms need a human face to them. Changes in financing methods coupled with changes in health system organization and management with ongoing public sector reforms are effective health sector reforms.