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What is the difference between sentences below?

The government ceased providing free health care.

and

The government ceased to provide free health care.

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No. 1 is correct.

No. 2 is correct, but sounds awkward compared to #1. In this case, the infinitive following the verb "ceased" is acting as its direct object. But as you have pointed out, using a gerund would be a simpler construction. I suspect some people favor this construction because it sounds more "official" or like legal writing.

A better use of an infinitive following a verb should describe the purpose or intent of that action: The government has ceased the health care program to save money. (The infinitive "to save" describes the intent of "ceased."

Other uses of the infinitive:

After an adjective, to specify what the adjective describes: It is costly to provide free health care.

After a noun, to indicate purpose: The government passed a law to provide free healthcare.

As a subject: To provide free health care is the purpose of the law.

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