Introduction: Underdeveloped and developing countries are unable to provide essential healthcare to all of their inhabitants, and those who remain uninsured are at a huge risk of financial hardship. It’s never easy to divide limited resources. Method: This study attempts to examine that, If urban poors, a vulnerable section of the society is protected against catastrophic health expenditure. Is there any deepening of poverty among urban poor of the city of Jaipur due to catastrophic health expenditure? 426 households in Jaipur’s urban slums were surveyed. Results: The incidences of Catastrophic Health Expenditure were 8.1% among urban slum households. The mean positive overshoot was 33%. Poverty increased by 1% at National Poverty Line and by 2.6% at International Poverty Line estimates. The increase in the normalised mean positive poverty gap from 29.8% to 45.3% suggests that the existing poor are becoming more impoverished. There was a significant association between increasing health spending and household cuts in food and apparel spending, at p = 0.0001 and p = 0.05, respectively. Conclusion: The results show a huge disparity between poverty estimates based on national poverty standards (2.8%) and international poverty standards (37.1%) indicating the necessity for developing sensitive poverty criteria. It is also vital to make an evidence-based decision on whether to employ assurance, insurance, or a combination of the two healthcare delivery systems. The assurance approach might expand accessibility while also lowering healthcare expenditures for the entire community. Rather than creating two distinct insurance or assurance systems, the government should pool its resources and efforts into one.