What is the Cost of Healthcare in India?

what are the costs of healthcare in india in 2024

The improvement of medical infrastructure and treatments over the past few years has been remarkable. However, with this advancement, the cost of healthcare in India is increasing.

India’s healthcare system comprises both public and for-profit private providers. With a substantial presence of private institutions, 69.8% of total outpatient care falls under them. However, treatments from private service providers typically cost more.

Team Digit

Cost of Healthcare in India
Factors Influencing the Cost
Private vs Public Healthcare
Future of the Healthcare
Healthcare Financing and Payment
Cost of Medical Treatment
Needs and Benefits
Types of Insurance Plans
How to Choose the Right Insurance?
Risks of Not Buying Health Insurance
Frequently Asked Questions

What is the Cost of Healthcare in India in 2025?

According to NCBI, the estimated annual cost of universal healthcare will be ₹1,713 per person. This cost can increase by 24% for using branded medical supplies and drugs. The Indian government must spend 3.8% of the country’s GDP to universalize healthcare services.

Factors that Influence the Cost of Healthcare in India

Various factors influence the cost of healthcare for Indian people. Below are some factors that have a greater impact on the cost of healthcare in our country -

Factors	Description
Location	A significant factor influencing the cost of healthcare in India is the location of treatment. This indicates which city or area you are availing your treatments from. Treatments in metropolitan cities are usually costlier than those in small cities and towns. Plus, treatment costs may vary from one metropolitan area to another.
Infrastructure	The cost of healthcare also varies on the basis of infrastructure type. Treatments generally cost more if the infrastructure of the healthcare centre is advanced and modern. This is why most middle and lower-middle-class patients can only avail of low-quality healthcare services.
Availability of Services	Most developing countries lack the infrastructure for specific treatments. It tends to be costlier if you fetch such a rarely available service. Also, the transport cost to reach the place where such treatment is available is an additional burden for many people.
Fatality of Diseases	Healthcare costs become high in case your disease is fatal or incurable. Such diseases usually need more expensive drugs, tests, and daily checkups, among other things. All these keep adding to the total cost of your treatment.

Private Healthcare vs Public Healthcare

The difference between private and public Healthcare also plays a huge role in the cost. Understanding the differences is crucial for making informed decisions about medical care. This comparison highlights the key aspects of cost, quality, and accessibility in both sectors.

Aspect	Private Healthcare	Public Healthcare
Cost	Higher costs due to advanced facilities and services	Lower costs or free services subsidised by the government
Quality of Care	Generally higher with better facilities, shorter wait times, and more personalised care	Varies widely; often lower due to overcrowding, fewer resources, and longer wait times
Accessibility	More accessible in urban areas; less accessible in rural regions	Widely accessible in both urban and rural areas, but services may be limited in quality and availability
Wait Times	Shorter wait times for consultations and treatments	Longer wait times due to higher patient volumes and fewer resources
Technology and Equipment	Access to the latest medical technology and equipment	May lack the latest technology and equipment, leading to longer diagnosis and treatment times
Specialised Services	Easier access to specialised services and specialists	Limited access to specialised services; often require referrals and longer wait times
Inpatient Services	More comfortable inpatient services with private rooms and additional amenities	Basic inpatient services are often crowded with shared rooms and fewer amenities
Doctor-Patient Ratio	Lower ratio leading to more personalised attention	A higher ratio leads to less personalised attention
Coverage of Procedures	Covers a wide range of elective and non-elective procedures	Primarily covers essential medical services; elective procedures may not be covered
Follow-up Care	More consistent and timely follow-up care	Inconsistent follow-up care due to resource constraints
Medication Availability	Wider availability of newer and branded medications	Limited to essential and generic medications; newer drugs may not be available

What is the Future of the Healthcare Industry in India?

With significant growth in infrastructure, the cost of healthcare is shooting up. Although advanced technology has sped up the treatment and curing process, it hasn’t eased the medical expenses for a large belt of Indians.

The current annual rate of medical inflation is 15%. Conversely, India’s overall inflation rate is 6-7% annually. Health expenditure currently stands at 5% of India's private final consumption expenditure. This can increase by a minimum of 11% from the current level of India. Gradually, the cost of healthcare in India is becoming unaffordable for people with financial drawbacks.

Healthcare Financing and Payment Systems in India

what are the payment and financing systems in india for healthcare

Healthcare financing in India involves a range of methods, each with its own implications for individuals and the overall system. Here’s a breakdown of the primary methods:

1. Out-of-Pocket Expenses

Out-of-pocket expenses refer to the direct payments made by individuals for medical services and treatments. This method often burdens patients financially, especially in the absence of health insurance. The costs can vary widely depending on the type of treatment and the healthcare facility, leading to financial strain or debt if medical issues arise.

2. Government Subsidies

The Indian government provides subsidies to make healthcare more affordable for low-income groups and vulnerable populations. Programs like Ayushman Bharat, which includes the Pradhan Mantri Jan Arogya Yojana (PMJAY), offer financial assistance by covering a portion of healthcare costs for eligible beneficiaries.

3. Insurance Schemes

Health insurance schemes are designed to share the financial risk associated with medical expenses. Various types of health insurance are available:

Health Insurance Policy: Offered by private insurance companies, these plans provide coverage for various medical services, including hospitalisation, surgeries, and outpatient treatments. Premiums and coverage levels vary based on the plan.
Government Health Insurance Schemes: These include schemes like Ayushman Bharat and state-specific insurance programs. They are often aimed at low-income families and provide coverage for various medical expenses.
Employer-Sponsored Health Insurance: Many employers provide health insurance as part of their employee benefits package. These plans often extend coverage to employees and their families, offering various medical services and treatments.

Cost of Medical Treatment for Major Diseases

Discussed below are the costs of average medical treatment, as per cities. Take a look.

Treatment Cost for Kidney and Urinary Diseases

City	Minimum Price	Maximum Price
New Delhi	₹ 1,500	₹ 5,000
Mumbai	₹ 600	₹ 6,000
Kolkata	₹ 900	₹ 7,700
Bengaluru	₹ 1,000	₹ 5,000
Chennai	₹ 750	₹ 7,500
Hyderabad	₹ 1,200	₹ 5,000

Treatment Cost for Cardio-vascular Diseases

City	Minimum Price	Maximum Price
New Delhi	₹ 1,70,000	₹4,50,000
Mumbai	₹ 1,40,000	₹ 7,00,000
Kolkata	₹ 1,15,000	₹ 4,50,000
Bengaluru	₹ 70,000	₹ 6,00,000
Chennai	₹1,50,000	₹ 6,00,000
Hyderabad	₹ 1,50,000	₹ 8,00,000

Treatment Cost for Gallbladder Stones

City	Minimum Price	Maximum Price
New Delhi	₹ 21,800	₹ 2,10,000
Mumbai	₹ 61,500	₹ 3,17,000
Kolkata	₹ 69,550	₹ 1,67,000
Bengaluru	₹ 87,600	₹ 1,68,800
Chennai	₹ 99,600	₹ 1,87,660
Hyderabad	₹ 1,18,200	₹ 2,76,831

Treatment Cost for Cataract

City	Minimum Price	Maximum Price
New Delhi	₹ 10,500	₹ 1,20,000
Mumbai	₹ 8,000	₹ 1,25,000
Kolkata	₹ 8,000	₹ 1,20,000
Bengaluru	₹ 9,000	₹ 1,84,000
Chennai	₹ 10,800	₹ 50,000
Hyderabad	₹ 8,000	₹ 1,50,000

Treatment Cost for Angioplasty

City	Minimum Price	Maximum Price
New Delhi	₹ 70,000	₹ 4,50,000
Mumbai	₹ 55,000	₹ 5,50,000
Kolkata	₹ 45,000	₹ 3,41,000
Bengaluru	₹ 50,000	₹ 5,00,000
Chennai	₹ 84,900	₹ 3,50,000
Hyderabad	₹ 68,000	₹ 3,85,000

[Source]

What are the Needs and Benefits of Health Insurance in India?

advantages of buying health insurance in india

As discussed above, healthcare in India is becoming way too expensive for many people. In such a situation, health insurance can be beneficial in many ways.

Here are some advantages:

1. Doesn’t affect your savings

The sky-rocketing treatment costs can be a huge burden for most individuals. Especially in the case of a fatal disease, these costs continue to exhaust your savings. In such a condition, a health insurance policy can cover your treatment expenses. Thus, you need not spend all your savings on treatment.

2. Helps cover critical medical conditions

Medical costs in India for critical conditions like organ failure or stroke is relatively higher. A health insurance policy will cover certain charges that you may suddenly face in such times.

3. Cashless Treatment

You can receive cashless treatments if you have insurance since different hospital networks collaborate with your insurance provider.

4. Pre and Post Hospitalisation Cost Coverage

Depending on the insurance plans chosen, the insurance policy will also pay pre- and post-hospitalisation costs for a maximum of 60 days.

5. Transportation Fees

The insurance policy also covers the money paid to the ambulance for the insured person's transportation.

6. Medical Exam

Insurance policies also provide options for health examinations. Certain insurers also offer free health checks based on your prior NCBs.

7. Medical Exam

Insurance policies also provide options for health examinations. Certain insurers also offer free health checks based on your prior NCBs.

8. Room Rent

Depending on the insured's premium payment history, the insurance policy may additionally cover lodging costs.

9. Benefit to the IRS

Section 80D of the Income Tax Act allows for the tax deduction of health insurance premiums.

Different Types of Insurance Plans in India

By understanding the various health insurance options, you can choose a plan that best suits your individual or family needs, ensuring you receive the coverage required for optimal health and financial protection.

Types of Insurance Plan	Description
Individual Health Insurance Plans	These plans cover one person and are ideal for single individuals seeking coverage. Premiums depend on the sum insured, age, and health status and typically range from a few thousand to several tens of thousands of rupees annually.
Family Floater Plans	These plans cover an entire family under one policy, often cheaper than individual plans. Coverage includes hospitalisation and related expenses. Based on family size and age, premiums usually range from INR 10,000 to INR 50,000 annually.
Critical Illness Insurance	This plan provides a lump sum payout for severe illnesses like cancer or heart disease. Due to the nature of coverage, premiums are higher, generally ranging from INR 15,000 to INR 60,000 annually.
Top-Up Plans	Supplementary policies that enhance existing coverage with higher deductibles. They offer additional coverage at a lower premium, starting at around INR 5,000, depending on the sum insured.
Government Schemes	Schemes like Ayushman Bharat offer subsidised health insurance for low-income families, covering a wide range of treatments at minimal or no cost. Premiums are often fully covered by the government.

How to Choose the Right Health Insurance Plan?

Choosing the right health insurance plan is essential for ensuring you get the coverage that best meets your needs and budget. Carefully evaluating your options can help you select a plan that provides optimal protection and financial peace of mind.

1. Assess Your Needs

Consider your health status and any medical conditions to choose a plan that covers your needs comprehensively, including any pre-existing conditions.

2. Compare Coverage

Evaluate different plans based on coverage for hospitalisation, pre- and post-hospitalisation expenses, and additional benefits.

3. Consider Your Budget

Balance the cost of premiums with the coverage offered. Include potential copayments and deductibles in your budget to ensure affordability.

4. Check Network Hospitals

Ensure the plan includes a broad network of hospitals, particularly those conveniently located and offering quality care.

5. Review Insurer’s Claim Settlement Ratio

Research the insurer’s claim settlement ratio to gauge reliability. Look for positive customer reviews and service ratings.

By evaluating these factors, you can select a health insurance plan that aligns with your needs and budget, providing the coverage and protection you require.

What are the Risks of Not Buying Health Insurance?

Not buying health insurance can expose you to significant financial and health risks. Understanding these risks is crucial for making informed decisions about your healthcare coverage and protecting your financial stability during difficult times.

1. High Out-of-Pocket Expenses

Without health insurance, individuals are responsible for the full cost of medical treatments. This can be financially devastating, especially in the case of a serious illness or injury. The burden of these expenses can lead to significant financial strain and stress.

2. Limited Access to Quality Care

Uninsured individuals may delay or forgo necessary medical care due to concerns about affordability. This can result in poorer health outcomes and the progression of diseases to more advanced stages. Timely medical attention is crucial for effective treatment and recovery.

3. Financial Instability

Medical emergencies can lead to substantial debt and financial instability for those without insurance. Health insurance helps to mitigate this risk by covering a significant portion of medical expenses. This offers financial stability and peace of mind during health crises.

4. Inadequate Preventive Care

Without insurance, people are less likely to access preventive care such as vaccinations and regular check-ups. This can increase the risk of undiagnosed and untreated health conditions. Preventive care is essential for maintaining long-term health and early detection of issues.

5. Higher Overall Healthcare Costs

Uninsured people often pay more for medical services compared to those with insurance. This is because they do not benefit from the discounted rates that insurers negotiate with healthcare providers. The lack of negotiated rates can result in higher overall expenses for medical care.

6. Potential for Medical Bankruptcy

Big medical bills can lead to bankruptcy, which health insurance can help prevent. By covering major healthcare costs, insurance provides financial protection and reduces the risk of falling into financial hardship. This protection is crucial for safeguarding financial stability.

7. Increased Stress and Anxiety

A lack of health insurance can cause constant worry about potential medical emergencies and their costs. This ongoing stress and anxiety can negatively impact mental health and overall well-being. Financial concerns about healthcare can contribute to significant emotional distress.

8. Limited Access to Specialised Treatments

Uninsured people may find it difficult to afford specialised treatments or medications necessary for managing chronic or severe conditions. Access to these critical treatments is often more feasible with health insurance. Without it, managing complex health issues can become difficult.

The cost of healthcare in India is increasing day after day without any doubt. It also becomes an immense distress if you seek treatment from a metropolis. Under such circumstances, a health insurance policy helps you avail yourself of quality treatment without risking your savings. Understanding which insurance policy to buy is an important decision for people. Take care of yourself and your family with the best insurance policy.

FAQs about the Cost of Healthcare in India

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How many people in India are affected by costly medical care?

Almost 80.9% of the urban population and 85.9% of rural population in India do not have any health insurance policy. Also, over 80% of Indians are paying for private healthcare on their own.

How can I manage healthcare costs in India?

A great way to cover your medical expenses is by opting for a medical insurance scheme. However, be careful about the coverages and benefits that your insurer offers while purchasing a policy.

How can health insurance benefit me financially?

Health insurance can protect you from high out-of-pocket medical expenses by covering a significant portion of your healthcare costs. This financial protection helps you manage your budget and avoid unexpected expenses.

What should I consider when choosing a health insurance policy?

When selecting a health insurance policy, consider factors like coverage options, network hospitals, premium costs, deductibles, and the extent of financial protection provided. Comparing policies helps you find one that best fits your needs.

Are there any government health insurance schemes in India?

Yes, the Indian government offers several health insurance schemes, such as Ayushman Bharat, which provides coverage for low-income families. These schemes aim to make healthcare more accessible and affordable for the underprivileged.

How does health insurance coverage work for pre-existing conditions?

Many health insurance policies cover pre-existing conditions, but a waiting period may occur before full coverage kicks in. It’s important to check the terms and conditions of your policy to understand how pre-existing conditions are managed.

What is the importance of a cashless health insurance facility?

A cashless health insurance facility allows you to receive medical treatment without paying out-of-pocket upfront. The insurance company directly settles the bills with the hospital, reducing your financial burden during emergencies.

How do I know if my current health insurance policy is sufficient?

Review your policy periodically to ensure it meets your current health needs and lifestyle. Assess factors like coverage limits, exclusions, and network hospitals to determine if they are adequate for your needs.

What are the benefits of a family floater health insurance policy?

A family floater policy covers the entire family under a single plan, offering cost-effective insurance and simplifying management. It also allows for shared sum insured and often includes added benefits for multiple family members.

Can I switch health insurance providers?

Yes, you can switch health insurance providers, but it’s important to review the new policy thoroughly and consider any waiting periods for pre-existing conditions.

How does preventive care benefit from health insurance?

Health insurance often covers preventive care services, such as vaccinations and screenings, which can help in the early detection and management of health issues.

What are the common exclusions in health insurance policies?

Common exclusions in health insurance policies include pre-existing conditions during the waiting period, cosmetic procedures, and treatments for certain chronic illnesses. Reading the policy details carefully helps in understanding what is not covered.

How does health insurance impact my tax benefits?

In India, health insurance premiums qualify for tax deductions under Section 80D of the Income Tax Act. This benefit can reduce taxable income and provide financial advantages beyond health coverage.

What steps should I take if my health insurance claim is denied?

If your claim is denied, review the policy terms and reasons for denial and contact your insurer for clarification. You can also file a grievance with the insurance company or approach the Insurance Ombudsman if necessary.