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While the healthcare sector is exempted from GST, patients might end up paying more as the expenses incurred by hospitals are likely to increase.
According to A Sridhar (name changed), who runs an orthopaedic hospital in Chennai, patient bills are likely to increase 3-4 per cent under the GST regime that kicked in on Saturday. This is because the cost of most of the drugs, reagents and disposables that hospitals use have increased at least 5 per cent, also housekeeping and security services costs.
“We expect 5 per cent hit in our profit margins in pharmacies,” Sridhar said. All of these will reflect in patients’ bills. In addition to that, the service charge for card payments has increased from 15 per cent to 18 per cent.
“With more than 5 per cent hike, we have no option but to pass it on to consumers,” he added.
Subbiah Viswanathan, Chief Operating Officer, Apollo Hospitals, said it is too early to access the impact of GST in healthcare. It will take a couple of weeks to ascertain the impact, he added.
Rajiv Nath, Forum Coordinator, Association of Indian Medical Devices Industry, said that while most of the medical equipment are now in the 12 per cent tax bracket, diagnostic equipment such as thermometers, hospital beds and dental chairs are under 18 per cent. This will have an impact on the input cost.
Drug prices too might see an increase of 2-3 per cent, and some places might witness shortage of drugs till mid-July. KK Selvan, General Secretary, Tamil Nadu Chemists and Druggists Association, said that while the cost of essential drugs will remain the same, about 35 per cent of drugs will see a price increase of 2-3 per cent. “Insulin is now in the 5 per cent bracket, which was earlier zero for Tamil Nadu,” he added. Diabetic patients in the State might have to shell out more, he added.
Around 70 per cent of wholesalers have shut shop over the weekend in a bid to get ready for GST. “We have stopped sales and reduced our stock as we need to make our system GST-ready,” Selvan said. “Because of this, there might a shortage of drugs till July 10.”
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