On 13 June, the Karnataka legislative assembly discussed a law to enforce standardised charges for medical treatments. The following days saw closed hospitals, doctors on the streets protesting against the bill and heated debates among the state’s political leaders. A week later, the government decided to reconsider the bill.

The risk is mitigated but certainly not averted for private healthcare providers.

Karnataka is not the first state to express an intention to fix prices for them, and it certainly won’t be the last. In the last few months, the medical fraternity has learnt that the narrative of a hospital that exploits patients is strong, and price control is not an empty threat. The state’s intention to regulate hospital treatment prices is real. Like a chameleon, it is manifesting in unique regional and political environments.

Health is the domain of the state, not the centre, and the tool that state governments currently use is the Clinical Establishments (Registration and Regulation) Act, 2010. Can the legislation regulate prices? No. Does it favour the standardisation of charges by state governments? Yes. A crown jewel of the Indian public health movement, the Act’s intention was to usher transparency, better quality care and monitoring of private hospitals, under one law for the first time in the country.

The law is one thing and politics, another. Although notified in 11 states, it’s not completely functional in any state—it has not ensured regulation of every clinical entity, even in states where the law does exist. This is recognised by both stakeholders—doctors and policymakers. Why? Because of the resistance by the state chapters of medical associations, points out Sunil Nandraj, who was one of the drafters of the legislation.

The journey of the Clinical Establishment Act

The law is one thing and politics, another. Although notified in 11 states, it’s not completely functional in any state—it has not ensured the regulation of every clinical establishment even in states, where the law does exist. This is recognised by both stakeholders—doctors and policymakers

The doctors won the first round. But did the state governments accept defeat? Clearly not.

Nandraj did develop a template that the states could follow to determine the rates for hospital procedures, but he says that the politicians wanted more out of the bill. They wanted to cap prices.

The politicians’ intention has taken a tangible form. On 17 March, West Bengal enacted the law. On 1 June, the state government proposed the rates, fixed under the state health insurance scheme Swasthya Sathi, announced in February 2016, for all treatment and diagnostic packages across hospitals.

AUTHOR

Ruhi Kandhari

Ruhi writes on the impact of healthcare policies, trends in the healthcare sector and developments on the implementation of Electronic Health Records in India. She has an M. Sc. in Development Studies from the London School of Economics.

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