'Probe inflated costs at corporate hospitals'
MUMBAI, Oct. 6 -- The citizen-led Jan Swasthya Abhiyan (JSA) is demanding an investigation into alleged anti-competitive practices and violations of competition law by private corporate hospitals, leading to highly inflated costs being levied on their patients.
A study by the JSA has found that leading listed corporate hospitals levy inflated medical costs on their patients well beyond their procurement, hospital maintenance costs or staffing expenses. It has also found that corporate hospital chains charge an average Rs.60,000-78,000 per day for treatment.
The problem, according to Dr Abhay Shukla, co-convenor of the JSA, is the lack of regulatory caps, which has led to massive profiteering by these institutions.
Inflated costs of medicines, medical devices and medical consumables being charged by hospitals is in line with the findings of Maharashtra's Food and Drugs Administration (FDA) commissioner Tukaram Mundhe. The FDA chief recently found that the Maximum Retail Price (MRP) of medical consumables in hospitals, like IV sets and syringes, was 2,841% more than their procurement price.
The JSA, leading a campaign for a cap on rates charged by private hospitals, is now demanding a time-bound investigation by the Competition Commission of India (CCI) into potentially anti-competitive practices and violations of competition law by private hospitals. JSA and a working group on Access to Medicines and Treatment, are warning that "increasing financialisation of healthcare is affecting not just patients but clinical practice itself".
Although the Government of India had passed the Clinical Establishment Act (CEA) in 2010, to cap hospital charges, the law is yet to be implemented due to stiff opposition from the private hospital sector, the JSA alleges.
Dr Abul Hasan, chairperson of the Hospital Board of India, which represents over 95,000 private hospitals in the country, offers a contrary view. "The CEA has not been adopted by states like Tamil Nadu, which have adopted their own laws. Other states, like West Bengal, have modified the law and implemented their own version. And states like Maharashtra have not implemented the Act at all. We have intervened to challenge this particular provision in the Supreme Court since we are opposed to capping or even standardisation or uniform hospital charges," he says.
Explaining their opposition to uniform rates and capping hospital charges, Dr Hasan adds, "Standard rates are unfair and discriminatory besides impractical. How is it fair to levy standard rates for the super-specialists with the junior doctors? Also, various procedures differ in many ways. Across the country, the establishment costs as well as the staff costs vary vastly depending on whether it is a metro or a Tier-II or Tier-III city or a mofussil town."
He says capping hospital charges could prove detrimental for the sector since it could prevent expansion of private healthcare. The infusion of the latest machinery and technology could also be impacted, which can only be sustained by profit margins, he adds.
Dr Hasan also says the bulk of the hospital care sector in India consists of small nursing homes, which constitute almost 60% of the total bed strength in India, while corporate listed hospitals barely constitute 5%. "A large majority of the private hospitals network includes the small hospitals, which are barely breaking even," he says....
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