Mumbai: Wise minds will reconsider a blanket price cap on private hospital room rents once affordability is weighed against the need for new hospital beds, said Abhay Soi, Chairman, Max Healthcare, amid the ongoing debate over a Parliamentary panel’s recommendation.
The recommendation is part of the Parliamentary Standing Committee on Health and Family Welfare’s report on the affordability and accessibility of healthcare facilities in the public and private sectors.
The panel has suggested that basic room charges at private hospitals in major metropolitan cities should not exceed the average room tariff prevailing at three-star hotels in the peripheral area or vicinity of the hospital.
Addressing the issue during the Max Healthcare earnings call, Soi said, “The recent committee report speaks about affordability, but one needs to look at another important aspect, which is the need for new hospital beds and viability. Both need to go hand in hand. I think once you take that equation into account, wise minds will think otherwise.
“We believe the sector will require a lot more capital and you have to have an environment which is both viable and conducive to investments for hospitals to be built. All in all, you need to look at it in the balance, which I’m sure the ministry will do,” he added.
Soi said the healthcare major is not reconsidering its expansion plans due to the proposed price caps.
“We are efficient providers of healthcare. If there is going to be any sort of risk-free returns available or if there’s any viable proposition for anyone to set up hospitals, we believe we will have superior returns relative to that. Therefore, tomorrow, if it does happen, it will become an opportunity for consolidation for us.
“I’m focused on providing the best of healthcare. Eventually, any policy has to cater to the mean, not to the outliers, and as far as efficiency is concerned, we are outliers,” he said.
Admission decisions a matter between doctors and insurers
On hospital admission norms, Soi said this should be a matter between doctors and insurance companies, not hospitals, responding to the General Insurance Council’s (GIC) new clinical guidelines aimed at curbing “unnecessary hospitalisation” and rising health insurance claims.
The guidelines advise hospitals and nursing homes on when patients with common fevers and infectious diseases should be admitted and considered eligible for cashless insurance.
“We are not seeing any occupancy impact due to this, but you have to understand what the role of a hospital is. A hospital does not admit a patient, a doctor admits a patient. This is a matter between insurance companies and clinicians. If the doctor says admit the patient, we admit the patient. If they say admission is not required, we cannot admit the patient. There’s a protocol. We are only the providers of logistics, infrastructure and services.
“The call to admit or not admit a patient lies solely with the doctors. If the insurance companies are eventually able to standardise that in some manner with the doctors, so be it. Eventually, the IMA has to agree,” he added.
His comments come after the Association of Healthcare Providers (India) (AHPI), which represents more than 21,000 hospitals, said the advisory should be seen only as a guideline and warned that it would oppose any attempt by insurers to use it to deny cashless approvals or reject claims.
