India's healthcare landscape has witnessed a significant transformation with the introduction of the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PM-JAY). Launched in September 2018, this ambitious initiative aimed to provide financial protection to over 500 million citizens, making it the world's largest publicly funded health insurance scheme.
Its primary objective was to reduce out-of-pocket expenditures (OOPE) and catastrophic health expenditures (CHE), thereby alleviating the financial burden on households seeking medical care.
Government's Strategic Initiatives
The Indian government recognised the need to enhance insurance penetration to achieve Universal Health Coverage (UHC). Prior to the PM-JAY, India had a relatively low insurance penetration, with a significant reliance on out-of-pocket spending. The introduction of PM-JAY marked a pivotal shift towards inclusive healthcare financing. The scheme was designed to provide cashless hospitalisation for secondary and tertiary care, covering a wide range of medical conditions and treatments.
The Union Budget 2025-26 allocated Rs. 99,859 crore (US$11.60 billion) for healthcare, including funding for PM-JAY and health infrastructure strengthening. The scheme covers health insurance up to Rs 5 lakh per family per year for secondary and tertiary care treatments, aiming to reach over 500 million beneficiaries. In 2024, the government expanded PM-JAY to include all senior citizens aged 70 and above, regardless of income, benefitting over 58 lakh senior citizens already enrolled.
Impact on Insurance Penetration
The implementation of PM-JAY has led to a notable increase in health insurance coverage across the country. As of June 2, 2025, over 41 crore Ayushman Bharat cards (PM-JAY) have been created nationwide, covering a significant portion of vulnerable and underprivileged populations. This update shows an increase from 40.57 crore cards created by mid-April 2025.
The scheme empanels over 31,846 hospitals, with private hospitals accounting for about 46% of empanelled hospitals and contributing 54% of claims. Furthermore, PM-JAY has facilitated over 8.59 crore hospital admissions with significant out-of-pocket savings, reducing OOPE from around 62% to 38% in covered families.
Road Ahead
Looking forward, the government aims to further strengthen the healthcare infrastructure by increasing public health expenditure and expanding the scope of PM-JAY. Efforts are also underway to integrate digital health technologies and enhance the quality of care provided under the scheme. With continued commitment and strategic planning, India is poised to achieve comprehensive health coverage for all its citizens.
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