NEW DELHI: Patients seeking high-end care at private hospitals may have to shell out more as the GST Council has recommended levying 5% tax without input tax credit (ITC) on non-ICU hospital room rents costing more than Rs 5000 a day per patient. Healthcare service providers have raised concerns over the suggestion, underlining that it will increase healthcare cost for patients.
“In most of the private hospitals, bed charges are above Rs 5000. So this step, if implemented, will put additional burden on the middle class. Health is not a consumer-oriented service. This step should be reconsidered,” said Dr DS Rana, Chairman, Ganga Ram Hospital.
Industry representatives said the recommendations, if accepted by the government, will act as a deterrent to making quality healthcare affordable and can potentially increase out-of-pocket expenditure for those who opt for private healthcare services.
Association of Healthcare Providers (India) – representing private hospitals – urged health minister Mansukh Mandaviya to take up the issue with the finance ministry and get the recommendation withdrawn.
“It will put extra financial burden on hospitals. Considering that hospitals are already facing severe financial sustainability issues, they will have no option but to pass on this burden to patients,” AHPI director general Girdhar Gyani said.
“Hospital beds are not hotel beds. Patients do not come for business or recreation but to address health issues. The cost of beds in tertiary and quaternity care hospitals is high for all valid reasons and therefore AHPI calls upon the finance minister to withdraw this recommendation,” AHPI said in a statement.
While almost 60% of all hospitalisations and 70% of out-patient services are delivered by the private sector, around 63% of current health spending in the country is out-of-pocket expenditure.