Health Insurance Coverage Expands Amid Rising Hospitalization Costs
India's Health Insurance Coverage Expands Sharply Over Eight Years
According to the latest health survey released by the National Statistics Office on April 20, India's health insurance coverage has expanded significantly over the past eight years. The survey reveals that government-backed schemes have driven most of the increase in coverage, even as reported illness and hospitalisation spending have risen substantially.
The data shows that the share of people covered under at least one health insurance or financing scheme rose to 47.4 percent in rural areas in 2025 from 14.1 percent in 2017-18. In urban India, coverage increased to 44.3 percent from 19.1 percent over the same period. Notably, 2025 marks the first year when rural coverage has overtaken coverage in urban areas.
Government-sponsored schemes accounted for the bulk of enrolments, covering 45.5 percent of the rural population and 31.8 percent of the urban population in 2025.
| Coverage Type | Rural Areas | Urban Areas | Difference |
|---|---|---|---|
| 2017-18 Coverage | 14.1% | 19.1% | -5% |
| 2025 Coverage | 47.4% | 44.3% | 3.1% |
The expansion in coverage comes alongside a rise in reported morbidity. About 13.1 percent of Indians said they suffered from some ailment, including chronic conditions, during the 15 days preceding the survey in 2025, compared with 7.5 percent in the previous health survey conducted in 2017-18.
Older Indians recorded the sharpest increase in health concerns. Among those aged 60 years and above, 43.9 percent reported being ailing in 2025, up from 27.7 percent in 2017-18. For the 45–59 age group, the share rose to 22.5 percent from 11.4 percent.
Average out-of-pocket spending per hospitalisation case excluding childbirth stood at Rs 34,064 in 2025, marking an increase from a little over Rs 20,000 in 2017-18.
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The rise in reported ailments may partly reflect better diagnosis, screening and awareness rather than only worsening health outcomes.
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