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UPDATE: Another one bites the dust

By deciding to make a list of essential diagnostics, the big daddies of Indian health policymaking have taken the first step towards a milestone. The National List of Essential Medicines (NLEM) was just a list before it set the price of hundreds of medicines. Last year, the list grew to include medical devices—cardiac stents and knee implants. On 12 March, the Health Ministry and NITI Aayog consulted to create another list of essential diagnostics.

What comes next is anyone’s guess.

After three months of discussions, the World Health Organisation (WHO) has convinced the health ministry to make certain diagnostics affordable. When the price regulator studied hospital bills in February, it found that diagnostics constituted over 15% of the bill, and the prices varied significantly across labs. The policymakers have begun the process to expand the scope of price control but the path to regulating the price of a diagnostic test is far more challenging than it was for drugs and devices.

This is primarily because there is no regulation for pathology labs in India. Only voluntary accreditation by the National Accreditation Board for Testing and Calibration Laboratories (NABL). Something only about 1% of the 100,000 labs possess. Unlike medical devices, for whom the Medical Device Rules kicked in from January 2018, and, of course, drugs, whose quality is monitored by the Drug Controller General of India. Diagnostics sector is neither bound by law nor a regulator.

Further, the policymakers have missed the one factor they cannot control—the price of treatment. If the health ministry fixes the price for diagnostic tests this year, it still would not be able to ensure that the benefit reaches the patient. It appears the lessons of stent price control haven’t reached the policymakers’ table.

To refresh public memory, we are re-publishing our earlier story and making it free.


As far as the popularity of any health policy goes, price ceiling for stents has made it right to the top. Just before Uttar Pradesh elections, Prime Minister Narendra Modiused it at a rally to woo the voters. The PM claimed that he was committed to providing affordable healthcare to everyone by reprimanding and controlling the profit-motivated businesses. Only if its simplicity and popularity made healthcare affordable.

Eight months later, the cheer from the crowds is followed by some behind-the-door discussion in fine print. Hospitals’ message: you can control the margins of devices but the price of medical procedures is ours to decide.

Hospitals have already recovered from the loss in revenue that followed price ceiling for stents from about 40% patients, who pay them directly. Now they have raised their game to begin negotiations with private health insurance companies, who pay for about 20% of the patients.


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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