India’s healthcare sector is undergoing a significant transformation, with private hospitals reporting a sharp rise in revenue. The growth is driven by increasing health insurance coverage and the rising demand for high-tech treatments for critical illnesses.
Rapid Growth in Hospital Earnings
Data from 2024–25 shows that the per-bed revenue (ARPOB – Average Revenue Per Occupied Bed) of the country’s top 10 private hospital chains has jumped from ₹40,015 per day last year to ₹49,304 per day—a 23% increase. Analysts say this reflects a major shift in India’s healthcare sector. Advanced treatments such as cancer therapy, cardiac surgeries, and robotic operations are becoming more common, and more patients are able to afford them thanks to health insurance.
Which Treatments Drive Revenue?
According to credit rating firm ICRA, between 2022–23 and 2024–25, per-bed revenue increased by roughly 10% annually. Mithri Macherla, ICRA Vice President and Head of Corporate Ratings, said, “This growth is largely driven by oncology, cardiac procedures, and advances in robotic surgery technology, which have boosted revenue per patient.”
Understanding ARPOB
ARPOB measures the average daily revenue generated from each occupied bed. Even if patients undergo complex treatments and are discharged quickly, the per-day revenue rises, reflecting higher efficiency. Nitin Agrawal, analyst at DAM Capital Advisors, explained, “Shorter stays for complex procedures increase ARPOB, as daily revenue calculation reflects intensive care and treatment costs per day.”
Top Performers
Fortis Healthcare led the pack last year with an ARPOB of ₹66,301, up 9% from the previous year. Apollo Hospitals saw its ARPOB rise from ₹57,488 to ₹60,588. Krishna Institute of Medical Sciences recorded the highest growth at nearly 23%, increasing from ₹31,916 to ₹39,158. Other chains, including Aster, Narayana Health, and Yatharth Hospitals, also reported strong revenue growth.
Who Saw a Decline?
Not all hospital chains experienced growth. Max Healthcare’s ARPOB fell from ₹78,000 to ₹73,000, though excluding new facilities in Noida, Nagpur, Lucknow, and Dwarka, the figure would be ₹83,000. Rainbow Children’s Hospital recorded a 3% drop. Analysts note that patients increasingly get diagnosed at specific centers and then opt for treatment at larger private hospitals, boosting their revenues.
Impact of Rising Insurance Coverage
Pretesh R. Kiran, a geriatrician and public health expert at St. John’s Medical College, Bengaluru, said, “Expanding insurance coverage has improved patient access, raising health awareness across India and increasing the adoption of private healthcare.”
A Sector in Transformation
This growth comes amid significant consolidation in the sector. Smaller hospitals are being acquired by larger regional and national chains. KPMG reports that this trend is likely to continue, with big hospital chains expanding into tier-2 and tier-3 cities. Global investment funds like KKR and Blackstone are increasingly investing heavily to accelerate growth, with Kerala emerging as a key state for such investments.
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