"President Donald Trump has chosen one of the leading experts in America on state-based healthcare solutions to lead this important agency," Vice President Pence said at the swearing-in ceremony at the White House.
"The President has asked you to bring your expertise to DC," Pence said, adding: "We're confident that you'll help restore healthcare decision making to the states, and in the process help make the best healthcare system in the world even better."
Verma is the second Indian-American to be inducted into the Trump administration.
US Ambassador to the United Nations Nikki Haley was the first cabinet rank official from the community to serve in any presidential administration.
"Today, our healthcare stands at a crossroads, and we have no choice but to reform it," she said.
The Senate confirmed her nomination on Monday by a vote of 55-43, largely along party lines.
Verma is taking over the agency as a Republican healthcare bill moving through the House has reopened the debate over the government's role in healthcare.
Verma is an Indiana healthcare consultant and protege of Pence, who is a former Indiana governor.
The American Association of Physicians of Indian Origin (AAPI) which represents more than 60,000 physicians, welcomed Verma's appointment, reported New India Times newspaper.
Ajay Lodha, President of AAPI, lauded Verma's accomplishments in Indiana, and said he hoped that the problems faced by patients under the Medicare drug plan would be resolved under her leadership.
"Drug coverage has gone down and for patients under Medicare who are all above 65, and not healthy and needed medications -- I hope she can do something for them." Lodha said.
When Trump announced in November that he was appointing Verma for the post, he said that she would be part of "the dream team that will transform our healthcare system for the benefit of all Americans".
Her role will extend beyond the insurance programmes -- Medicare for senior citizens and Medicaid for the poor -- to helping craft and implement the Republican healthcare reform plan to replace Obamacare.
"She has decades of experience advising on Medicare and Medicaid policy and helping states navigate our complicated systems," Trump had said.
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