A Delhi prescription for transparency and lower costs

PT Jyothi Datta | Updated on June 08, 2018

The Delhi government’s proposal to inject efficiency into healthcare is welcome. But implementation is the challenge

The clock ticks on a Delhi government proposal aimed at bringing down the cost for patients admitted at private hospitals, a move that has divided hospitals and healthcare workers along predictable lines.

The advisory involves capping the profit margin on medicines and consumables at a maximum of 50 per cent over their procurement cost. And it comes against the backdrop of the drug pricing regulator’s report that exposed massive margins on consumables at Fortis Hospital, where late seven-year old Adya’s family was handed a hefty bill.

The Delhi government’s late-May announcement comes even as trust levels between hospitals and doctors on one side and patient families on the other hit a new low in many parts of the country. And since health is under the local administration, other States too will be watching how the Delhi government navigates this tricky healthcare terrain, as the advisory is to be notified after 30 days of public consultation.

Corporate hospitals are wary of the price control mechanism that, they say, will impact the quality of healthcare services on offer. But patient representatives caution that any regulation is only as good as its implementation. And often, that’s where most initiatives falter.

Needs clarity

Dr Ajay Bakshi, India head of healthcare major Parkway Pantai, is unambiguous in welcoming any initiative that improves transparency in healthcare pricing. Even a video recording of price-related discussions between a hospital and its patients is a step towards improving trust between the two, he says. But there are pitfalls , he adds. Doctors are being directed to prescribe products only from the National List of Essential Medicines (NLEM) and patients too are now not mandated to buy medical products from the hospital of admission. The State needs to clarify who takes responsibility if a person dies because of an inferior quality product bought by a family from outside hospital premises, says Bakshi, a trained neurosurgeon. Hospitals need to be released from this liability, he says.

On controlling price, Bakshi explains that hospitals negotiate prices with their vendors. Different hospitals have different sourcing prices with different suppliers, so more clarity is required on the profit margin cut-off, he says, wondering how the government will monitor this dynamic situation.

The proposal needs to be thought through, he says, adding that transparency could be forced on hospitals by making them publish the price list on their website and in their lobbies, something that some hospitals already do.

Apollo Hospitals Managing Director Suneeta Reddy says that bringing corporate hospitals under a price net will be a “disincentive”, especially when they address about 70 per cent of the country’s healthcare needs. Competition and health insurance will keep prices in check, she says, adding that hospitals will be judged on their clinical outcomes. An incident at one hospital should not be used to tar the entire industry, she says, pointing out that government hospitals are not being put through similar scrutiny. Besides, unlike government hospitals, private ones have to pay multiple taxes, depreciation, maintenance, etc, she adds.

Grievance redress

But there others who feel that the Delhi government has made a beginning. Rajiv Nath with the Association of Indian Medical Device Industry says the advisory includes a reasonable margin and gives hospitals the opportunity to rebuild patient trust as the prices are fixed by the government. Cross-subsidising prices between medical products and hospital services is not acceptable, he says, adding that irritants like forcing patients to buy from the hospital, for instance, gradually build distrust in patients. And this results in unfortunate acts of violence being witnessed against doctors in many regions, he says.

Little Adya’s father Jayant Singh has taken legal recourse seeking an overhaul of the healthcare regulatory system. Speaking from experience, he says government reports showing overcharging, etc, have not led to a penalty or grievance redress. The Delhi government’s advisory shows some sensitivity, but it will be meaningless if it is not backed by strong implementation and follow-up action on penalties levied on the hospitals, he says.

There should be a monitoring body with patient representation and a grievance redressal mechanism, says Singh, so no one else has to experience what he went through with his child, he adds.

Published on June 08, 2018

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor