Avg hospitalisation 7X costlier in private hospitals than public ones, survey finds

The average cost of hospitalisation in private hospitals remains sharply higher than in public facilities, laying bare a persistent affordability gap even as India records significant gains in healthcare access, according to the latest National Statistical Office (NSO) health survey.

The data show that the average out-of-pocket expenditure for hospitalisation across all hospitals stands at Rs 34,064 – including private, charitable and government facilities., compared to just Rs 6,631 in public hospitals. In comparison, the average cost of hospitalisation in private hospitals was Rs 50,508.

Also, only 32.2 percent of hospitalisations were in government hospitals as compared to 64.2 percent of hospitalisations in private hospitals.

The figures revealed that 47.4 percent of the rural and 44.3 percent of the urban population had any health insurance coverage – private or government.

The NSO’s 80th Round Household Consumption: Health survey, based on responses from 1,39,732 households across rural and urban India in 2025, presents a mixed picture-one of expanding coverage and utilisation, but also deep structural inequities that continue to burden households financially.

Median costs further underline the disparity, with half of patients in public facilities spending Rs 1,100 or less, while the median across all hospitals rises to Rs 11,285.

The gap reflects the overwhelming reliance on costlier private healthcare providers, even as public systems expand.

RISING ACCESS, UNEVEN BURDEN

Healthcare access indicators show notable progress. Around 13.1 percent of Indians reported illness in the 15 days preceding the survey, with urban areas reporting slightly higher morbidity at 14.9 percent compared to 12.2 percent in rural regions.

Age remains a critical factor, with nearly 44 percent of those aged 60 and above reporting ailments, followed by 22.5 percent among those aged 45–59.

The survey highlights shifting disease patterns across age groups. Infectious and respiratory conditions dominate childhood and adolescence, while psychiatric, neurological, and gastrointestinal disorders peak in young adults.

After the age of 30, non-communicable diseases such as hypertension and diabetes become the most frequently reported.

Hospitalisation rates remain relatively modest, with 2.9 hospitalisation instances per 100 persons annually. However, urban residents reported higher hospitalisation rates (3.2 percent) than rural populations (2.7 percent), suggesting better access but also possibly higher disease detection.

Maternal healthcare indicators show near-universal institutionalisation. About 96.2 percent of births in the past year occurred in healthcare institutions, with rural India reporting 95.6 percent institutional deliveries and urban India reaching 97.8 percent.

Access to ante-natal care stands at 98 percent across both geographies, while post-natal care coverage ranges from 92 percent in rural to 95 percent in urban areas.

Insurance coverage has also expanded significantly. From just 14 percent in rural and 19 percent in urban areas in 2017–18, coverage has risen to 47 percent in rural and 44 percent in urban India by 2025, indicating the impact of government-backed schemes and broader policy push.

Yet, these gains have not translated into proportional financial protection.

PRIVATE DEPENDENCE PERSISTS

Despite improvements in public health infrastructure and insurance penetration, the survey reveals a continued and substantial dependence on private healthcare providers. Nearly 58 percent of hospitalisations in rural areas and 65 percent in urban areas occur in private facilities.

Public health experts argue that this trend reflects persistent gaps in the availability, accessibility, and perceived quality of public healthcare services. Patients often opt for private providers due to concerns over overcrowding, infrastructure limitations, or delays in public hospitals.

This reliance comes at a steep cost. Even as public hospitals offer significantly cheaper or free services – evident in outpatient care where the median cost in public facilities is effectively zero- patients continue to incur high expenses in private settings.

Outpatient care, often overlooked in insurance coverage, remains a steady financial drain. The average out-of-pocket expenditure for outpatient treatment stands at 861 nationally, with little variation between rural and urban areas.

In public hospitals, however, the average drops to Rs 289, with half of all treatments costing nothing.

Childbirth costs further illustrate the disparity. While the average expense in public hospitals is Rs 2,299, the overall average across all hospitals climbs to Rs 14,775.

Median figures show a similar trend, with Rs 801 in public facilities compared to Rs 2,851 overall.

Critics point out that insurance schemes, while expanding coverage, fail to adequately address outpatient care, diagnostics, and chronic disease management – areas where households incur repeated and cumulative expenses.

The result is a continuing cycle of financial vulnerability. High out-of-pocket expenditure remains a leading cause of indebtedness, particularly among low-income families who are forced to seek private care in the absence of reliable public alternatives.

The survey’s findings underscore a paradox at the heart of India’s healthcare system: access has improved, but affordability remains uneven.

While government interventions have expanded institutional care and insurance coverage, the dominance of private providers continues to drive up household spending.

Gouranga Mohapatra and Ritu Priya of Jan Swasthya Abhiyan of India (JSAI) argued that without substantial strengthening of public healthcare infrastructure – particularly in terms of quality, staffing, and accessibility – India’s healthcare gains may remain incomplete.