Assessing the Effectiveness of the Swasthya Sathi Scheme in West Bengal (2016)

Policy Update

Shruti Sethi

Background 

Health insurance has emerged as a critical policy instrument for achieving Universal Health Coverage (UHC) in India. Before the introduction of Swasthya Sathi, West Bengal faced significant challenges related to catastrophic health expenditure (CHE), low insurance penetration and unequal healthcare access. Swasthya Sathi was designed to address these challenges through a fully state-funded, cashless health assurance mechanism. Unlike many targeted welfare schemes, it gradually evolved into a near-universal program covering almost all residents not enrolled under another state-sponsored scheme.

Swasthya Sathi was approved by the West Bengal cabinet in February 2016 and formally launched by then-Chief Minister Mamata Banerjee on 30th December 2016, becoming operational in February 2017. In its initial form it targeted households identified through the deprivation criteria of the 2011 Socio-Economic Caste Census (SECC), along with specific occupational categories such as ASHA and ICDS workers and self-help group members. From December 1, 2020  i.e., months ahead of the 2021 state election, the state government extended eligibility to effectively all residents of West Bengal, regardless of income, caste or religion, provided they were not already covered by another government health scheme.

The scheme is entirely state-funded, requiring no premium contribution from beneficiaries and no central government financing. The state also moved away from a conventional insurance-company model (after working with National Insurance Company and United India Insurance Company in its first year) towards an “assurance” or trust-based modeladministered through a registered society, Swasthya Sathi Samiti, with the state government itself bearing the financial risk for claims. Beneficiaries receive a smart card on registration containing biometric and demographic details, and on discharge, real-time uploading of e-health records is reported. The government also provides a 24×7 toll-free call centre with a feedback mechanism.

Five Years of Budget Data: What the Numbers Show

The most systematic publicly available data on Swasthya Sathi’s scale and expenditure comes from the state government’s own annual Budget Statements, presented in the West Bengal Legislative Assembly each year from 2022-23 through 2026-27.

The table below sets out what the state government has reported about the scheme’s scale and spending in each of its last five Budget Statements.

Source: Author’s compilation based on West Bengal Budget Statements, the last presented by Finance Minister Chandrima Bhattacharya on 5th February 2026.

First, family enrolment grew quickly from 2.20 crore in 2021 to 2.41 crore in 2023 then plateaued at 2.45 crore for three consecutive years. This suggests the scheme reached effective saturation of its eligible population by around 2023. Subsequent growth in the scheme has come from rising utilisation rather than rising enrolment.

Second, the number of beneficiaries actually treated grew far faster than enrolment from roughly 25 lakh in 2021 to over 1.04 crore by 2026, a fourfold increase while enrolment barely moved.Third, the scheme spent roughly ₹3,213 crore in its first five years,  then nearly ₹10,527 crore in the following four years (2023 – 2026), confirming that universalisation in December 2020 caused a sharp and sustained acceleration in actual spending.

Figure 1: Family enrolment plateaued at 2.45 crore by 2023-24, while cumulative beneficiaries treated continued rising sharply through 2026-27, indicating that recent growth in the scheme has come from utilisation rather than new enrolment. Source: Author’s compilation from West Bengal Budget Statements, 2022-23 to 2026-27.

Reach and Coverage

One of Swasthya Sathi’s most notable achievements is its broad coverage architecture.

Key features include:

• Annual health cover of ₹5 lakh per family.
• Coverage irrespective of family size.
• Inclusion of pre-existing conditions.
• Cashless hospitalization.
• Smart cards issued in the name of the senior-most female member.

On the most basic measure i.e., how many people are formally enrolled, Swasthya Sathi’s performance is substantial.  Coverage reached 2.45 crore families and 8.51 crore people representing 90% of the state population, ahead of any comparable Indian state or national insurance scheme, most of which restrict eligibility to defined poverty or occupational categories covering only a fraction of the population. This near-universal coverage also minimises a problem that plagues more targeted programmes: exclusion errors, wheregenuinely poor households fail to appear on beneficiary lists because of data gaps or bureaucratic failures. 

Utilisation and Access

The scheme has generated substantial demand for hospital services. Cumulative beneficiaries served grew from roughly 25 lakh (end of 2021) to over 1.04 crore by the 2026-27 statement which is a more than fourfold increase in beneficiaries actually treated. This suggests the scheme has moved through a predictable lifecycle: a rapid enrolment phase, followed by a longer phase in which an already-enrolled population gradually makes more use of the entitlement. Daily utilization under the Swasthya Sathi Scheme stabilized at approximately 6,000 patients per day by 2023–24. 

Field research, however, reveals that utilisation is far from uniform across the state’s population. A cross-sectional study of 90 tribal households in Jharpukuria village, Malda district which was conducted in 2023-24, found that although 70% of households were enrolled in Swasthya Sathi, only 7.94% of those enrolled had actually used the scheme in the preceding year (Sarkar, Mandal, Islam & Dolai, 2026). enrolment and utilisation are clearly not the same thing, and in this tribal community they are very far apart.

A study of 100 rural households in Birbhum district found that only 18% of families had actually benefited from the scheme; 33% had not received their card (Sarkar & Paul, 2025). Scheduled Tribe households were the least likely to have benefited (12%), pointing to a specific gap in scheme reach among the state’s most marginalised communities.

A study of 67 slum dwellers in Rishra Municipality, Hooghly district found that 21% of respondents lived too far from an empanelled facility to make scheme use practical, and that geographic inaccessibility was reported as a concrete barrier to timely care (Nath, 2025).

These three studies are geographically limited covering one village, one block, and one municipality respectively. These findings cannot be statistically generalised to the whole state. However, they are consistent with each other across three different districts and population types, and they point in the same direction: the scheme’s utilisation is substantially lower than its enrolment figures suggest, particularly among rural, tribal and urban poor households.

Financial Protection

Financial protection — reducing what health economists call out-of-pocket expenditure (OOPE), meaning health costs paid directly by households rather than through insurance  is the core purpose of a hospitalisation insurance scheme. In this dimension, the picture is concerning.The most recent National Health Accounts estimates, released by the NHSRC in 2026 for the financial year 2022-23, show that West Bengal’s out-of-pocket expenditure stood at 62.3% of the state’s total health spending, with per capita OOPE of ₹4,183 compared to a national figure of 43.4% and ₹2,767 per capita for the same year (NHSRC, 2026).

These are state-level aggregate figures; they do not isolate Swasthya Sathi’s effect, since many factors shape OOPE trends. But the direction is clear: despite a decade of a state-funded hospitalisation insurance scheme with near-universal eligibility, West Bengal households continue to bear one of the highest out-of-pocket health spending burdens in India, well above the national average.

Figure 2: West Bengal’s out-of-pocket health expenditure remained substantially above the national average in FY 2022-23, despite the state’s decade-long, near-universal hospitalisation insurance scheme. Source: NHSRC, National Health Accounts Estimates for India (2022-23), Table A.6.

The field studies help explain why. Nath’s (2025) Rishra Municipality study found that despite the scheme’s “cashless” promise, 53% of respondents still paid for medicines out of pocket, 63% bore the cost of diagnostic tests outside the scheme, and 82% reported paying informal fees during hospitalisation. The scheme covers inpatient hospitalisation, but it does not cover outpatient visits, standalone diagnostics or medicines purchased outside the hospitalisation package and these constitute a large share of actual household health spending. This is a design boundary, not a failure of implementation, but its consequence isthat a household can hold a Swasthya Sathi card and still face significant out-of-pocket costs every time a family member falls ill.

NFHS-5 (2019-21) adds further context: the proportion of households in rural West Bengal with any form of health insurance coverage was just 31% and in Malda district, approximately 29%. This is broadly consistent with the Malda tribal study’s enrolment findings (70%) and very low actual utilisation (7.94%), suggesting that even in districts where card-holding is relatively common, the conversion from nominal coverage to realised financial protection is weak.

Equity

The scheme’s design has several genuine equity advantages. Universal eligibility since 2020 removed the exclusion errors common to targeted schemes (households just above a poverty threshold, or those missing from SECC lists) are no longer left out by definition. The woman-as-primary-cardholder feature formally recognises and reinforces women’s role in family health decisions.

Equity in practice, however, is more complicated. The Malda tribal study found that awareness of the scheme’s actual purpose and benefits was significantly associated with educational status (p=0.025) and socio-economic class (p=0.0013), meaning that better-educated and higher-income households were substantially more likely to understand what they were entitled to, even within an already-marginalised tribal community (Sarkar et al., 2026). In the Birbhum study, Scheduled Tribe households were the least likely to have received the scheme’s card (56% had no card) and the least likely to have benefited (Sarkar & Paul, 2025).

The Malda study also found that among households not enrolled, 23% cited inter-political beliefs or declined to disclose reasons, while 7% reported simple unawareness of the registration process. enrolment rates were higher among Christian households (87.5%) than Hindu households (68.2%) in that sample, a difference likely reflecting differential access to information and community networks rather than any design feature of the scheme itself.

Universal formal eligibility has not translated into universal realised benefit. The most marginalised groups (tribal communities, slum dwellers, residents of remote rural areas) remain the least likely to use the scheme in practice.

Hospital Network and Quality

The scheme has grown from roughly 2,749 empanelled hospitals in 2024-25 to 2,928 by 2026-27. But growth in the number of empanelled facilities does not by itself guarantee that patients can access them without difficulty. Nath’s (2025) Rishra Municipality study found that 39% of respondents had experienced reluctance or outright refusal by private hospitals to admit patients under the scheme, with providers citing low reimbursement rates and administrative complexities as primary reasons. 

News reporting from 2021 documented that private hospitals were allocated reimbursement rates for common procedures (open-heart surgery at ₹80,000 against typical charges of ₹3 lakh, gall-bladder surgery at ₹19,500 against private rates of over ₹40,000) that providers considered far below actual costs, leading hospitals to keep only a small number of beds reserved for scheme patients (Swarajya Mag, September 2021). The state government’s own public warning of legal action against hospitals refusing Swasthya Sathi patients (Millennium Post, 2022) confirms this was a systemic problem rather than an isolated complaint.

Governance and Fiscal Sustainability

On administrative design, Swasthya Sathi has genuine strengths: a single paperless smart card per family, centralised IT-based pre-authorisation, real-time electronic health records, and a defined claims-settlement standard. These are well-regarded features in health insurance administration and represent a real improvement over the slower, paper-based models used in earlier Indian schemes.

Two governance concerns are documented. First, in late 2024, during the period of statewide protests following the rape and murder of a junior doctor at R.G. Kar Medical College, the state government itself acknowledged a sudden and unexplained surge in Swasthya Sathi-related expenditure in private hospitals and announced an inquiry (Economic Times, November 2024). 

Second, a recurring concern about awareness found across all three field studies points to a governance gap in outreach and information, education, and communication (IEC) activities. Scheme cards have been widely distributed, but knowledge of what the scheme actually covers has not followed. In the Malda tribal study, 78% of respondents cited inadequate knowledge as the primary barrier to use, and 63% of respondents said their main source of information about the scheme was friends and family rather than any official channel (Sarkar et al., 2026). In the Rishra Municipality study, 82% of respondents were unaware of non-hospitalisation services, and 71% did not know medicines were covered under certain circumstances (Nath, 2025).

On fiscal sustainability, the five-year cumulative expenditure trend i.e., ₹3,213 crore (2021) to ₹13,740 crore (2026-27), shows steady, continuing growth in the state’s financial exposure. Annual scheme expenditure has stabilised around ₹2,000–2,100 crore, as directly reported for FY2023-24 in the budget statements. This is funded entirely by West Bengal without central cost-sharing, representing an open-ended commitment whose long-run affordability depends on continued state revenue growth.

Current TransitionFollowing BJP’s victory in West Bengal’s May 2026 assembly election and the change of government under Chief Minister Suvendu Adhikari, West Bengal signed a Memorandum of Understanding with the National Health Authority on 8th June 2026, becoming the 36th state or union territory to implement Ayushman Bharat (AB PM-JAY), with the scheme absorbing Swasthya Sathi from July 1, 2026 (PIB, 2026).

The BJP government’s first full budget, presented by Finance Minister Swapan Dasgupta on June 22, 2026, allocated ₹3,100 crore for AB PM-JAY implementation, a dedicated state budget line for a scheme the previous government had refused to adopt for nearly a decade (The Tribune, 2026). A State Health Authority (SHA) has been established to manage day-to-day administration, including eligibility verification, Ayushman card issuance, hospital empanelment, claims settlement and audits (Medical Buyer, 2026).

Official figures confirm what was previously only a projected risk: AB PM-JAY is expected to cover nearly 7 crore people in West Bengal — explicitly including ASHA and ICDS workers and all citizens above 70 years of age — compared to the 8.51 crore people covered under Swasthya Sathi’s near-universal model (The Tribune, 2026). This gap of roughly 1.5 crore people reflects PM-JAY’s narrower, SECC-based eligibility criteria, which restricts coverage to economically vulnerable households rather than the entire state population.

The new government has acknowledged this gap explicitly: a state government official confirmed that “poor households not covered under Ayushman Bharat guidelines would be supported through the Chief Minister’s Relief Fund for medical expenses” (Medical Buyer, 2026). This is a significant admission that the transition creates a coverage gap, though the Relief Fund is a discretionary mechanism rather than a structured supplementary scheme of the kind several other states have put in place alongside PM-JAY. 

Private hospitals have expressed apprehension about timely reimbursement under AB PM-JAY and as of the budget date, there was reported confusion among hospitals and health department officials about whether Swasthya Sathi claims would continue to be processed in parallel during the transition period (Medical Buyer, 2026). 

Whether the new state government designs a supplementary or top-up scheme to cover the population that falls outside PM-JAY’s eligibility criteria (as several other states with both PM-JAY and a state-level scheme have done) is the most important policy question to track going forward. This transition does not change the historical effectiveness record of Swasthya Sathi assessed above, but it does mean that the population covered by subsidised hospitalisation insurance in West Bengal appears to have measurably contracted, at least on paper, even as the scheme it replaced struggled with weak conversion of enrolment into realised benefit.

Conclusion 

Swasthya Sathi enrolled nearly 90% of West Bengal’s population into a premium-free hospitalisation insurance scheme, a scale of formal coverage that is genuinely significant. Its administrative design, women-as-primary-cardholder feature and growing utilisation volume over five years are real achievements.

On formal terms, the scheme has performed well and the evidence for this is consistent: 2.45 crore families formally enrolled over five years of budget reporting, with a hospital network approaching 3,000 facilities. On the uptake of that formal coverage, the picture is more mixed: aggregate utilisation has grown substantially in volume, but field research across three different districts and population groups consistently finds that rural, tribal and low-income households remain the least likely to convert enrolment into actual use.

On financial protection, the evidence is the most troubling. The NHA 2022-23 estimates show West Bengal’s OOPE at 62.3% of total health spending, well above the national figure of 43.4% for the same year, suggesting that the scheme has not meaningfully moved the aggregate out-of-pocket spending needle for the state’s households. Field research explains this in concrete terms: even enrolled scheme users continue to pay for medicines, diagnostics and informal fees that fall outside the hospitalisation package, while hospital refusals and geographic barriers limit access for those who need it most.

On equity, the scheme’s universal eligibility design is genuinely stronger than targeted alternatives, but implementation has reproduced existing social hierarchies: awareness, enrolment quality and utilisation are all systematically lower among Scheduled Tribe communities, rural households and residents of poorer districts, precisely the populations a universal scheme should serve first.

Swasthya Sathi’s record offers a clear lesson for health financing policy: enrolment and financial protection are not the same achievement and any successor programme (including Ayushman Bharat) will need to actively address the gaps in outpatient coverage, rural awareness, hospital network quality and claims oversight, rather than inherit them unchanged.

References

1. Our Mission and Vision. Swasthya Sathi Portal https://swasthyasathi.gov.in/vision

2. About the Scheme. Swasthya Sathi Portal https://swasthyasathi.gov.in/AboutScheme

3. Swasthya Sathi Report (Report ending January, 2021) https://swasthyasathi.gov.in/Content/HomeTabItems/SS_REPORT_JAN_20212021-04-3–14-04-30.pdf

Government of West Bengal, Finance Department. Budget Statements 2022-23, 2023-24, 2024-25, 2025-26, and 2026-27. 2022-23: https://www.cbgaindia.org/wp-content/uploads/2022/03/Budget-Speech-2022-23-West-Bengal.pdf

2023-24:

2024-25:

2025-26:

2026-27:

1. National Health Systems Resource Centre (NHSRC). National Health Accounts Estimates for India 2022-23. New Delhi: Ministry of Health and Family Welfare, Government of India, 2026. (West Bengal-specific figures from Annexure A.2, Table A.6, page 80.) https://nhsrcindia.org/sites/default/files/2026-05/NHA%202022-23%20Report.pdf

2. Government of India, Ministry of Health and Family Welfare. National Family Health Survey-5 (NFHS-5), 2019-21: State and District Fact Sheets, West Bengal and Malda. 

3. Nath, S. (2025). Swasthya Sathi and urban poor: An assessment among slum dwellers in Rishra municipality, Hooghly district. International Journal of Multidisciplinary Trends, 7(9): 51-55. 

4. Sarkar, S., & Paul, S.K. (2025). Role of health schemes in developing health conditions of the rural people in the district of Birbhum, West Bengal. International Journal for Multidisciplinary Research (IJFMR), 7(5). 

5. Sarkar, S., Mandal, S., Islam, T., & Dolai, S.K. (2026). Awareness and utilisation of health insurance schemes among the tribal population: A cross-sectional study in Malda district of West Bengal. International Journal of Medical and Pharmaceutical Research, 7(3): 1826-1834. (ICMR-STS funded; EMBASE-indexed.) 

https://ijmpr.in/article/awareness-and-utilisation-of-health-insurance-schemes-among-the-tribal-population-a-cross-sectional-study-in-malda-district-of-west-bengal-3226/Economic Times. 2024. Bengal govt probing into sudden surge in expenses under ‘Swasthya Sathi’ scheme: Mamata. https://health.economictimes.indiatimes.com/news/policy/bengal-govt-probing-into-sudden-surge-in-expenses-under-swasthya-sathi-scheme-mamata/115773810

2. Swarajya Mag. 2021. Explained: Why Mamata Banerjee’s health insurance scheme does little to help Bengal’s ailing millions. https://swarajyamag.com/politics/explained-why-mamata-banerjees-health-insurance-scheme-does-little-to-help-bengals-ailing-millions

3. Millennium Post. 2022. Stern action against hospitals refusing treatment under Swasthya Sathi: CM. https://www.millenniumpost.in/kolkata/stern-action-against-hosps-refusing-treatment-under-swasthya-sathi-cm-477760

4. Press Information Bureau. (2026). Ministry of Health and Family Welfare. Government of India https://www.pib.gov.in/PressReleasePage.aspx?PRID=2270375&reg=3&lang=2

5. The Tribune. 2026. Bengal Budget: BJP promises jobs, welfare push

6. The Medical Buyer. 2026. West Bengal proposes Rs 3,100 crore outlay for Ayushman Bharat rollout

About The Contributor

Shruti Sethi is a Research & Editorial Intern at IMPRI. She holds a bachelor’s degree in Economics from St. Xavier’s University, Kolkata. Her research interests include Gender & Labour Economics.

Acknowledgement

The author extends her sincere gratitude to the IMPRI team for their expert guidance and constructive feedback throughout the process.

Reviewed by Sneha Sharma and Simona Hughes.

Disclaimer

All views expressed in the article belong solely to the author and not necessarily to the organization.

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