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Being one of the population giants, India accommodates a large number of the elderly and their proportion is projected to increase significantly in the coming future. As the elderly are more susceptible to the disease, the rise in the number as well as proportion of the elderly assumes huge significance on health care. In this context, the study examines the economic burden of population aging in India. The proportion of elderly suffering from at least one ailment is as high as 44 per cent while 10 per cent of them suffer from at least two ailments. The findings also revealed that higher incidence of disease among the elderly is associated with higher health care expenditure.Further, the findings showed that the presence of elderly in a household has definite implications for the magnitude of health care expenditure. The study furthermore illustrates that death-related health expenditure has higher burden as compared to other health expenditure. Estimating the future cost of managing chronic diseases in Kerala, the study finds that it is going to increase considerably in the years to come in which majority of the increase will be attributed to the rise in the number of the aged.