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Hospitals that use their dominance to charge exorbitant prices may soon face penalties, says report

The Competition Commission of India (CCI) discovered that some of India's major hospital chains charged high fees for services and products, abusing their market dominance, according to a Moneycontrol article.

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New Delhi: The Competition Commission of India (CCI) discovered that some of India’s major hospital chains charged high fees for services and products, abusing their market dominance, according to a Moneycontrol article.

The fair-trade regulator for India will meet soon to review the responses provided by hospital chains including Apollo Hospitals, Max Healthcare, Fortis Healthcare, Batra Hospital & Medical Research, Sri Ganga Ram Hospital, and St Stephen’s Hospital. Based on the responses, it will then impose penalties.

The commission might impose severe penalties, said MC. The fine may be up to 10% of the average annual revenue of the hospital chains for the previous three years. Apollo had an average annual revenue of Rs 12,206 crore.

The average annual revenue of Fortis Hospitals over the previous three years was Rs 4,834 crore.

Renting of rooms, medications, diagnostic procedures, medical equipment, and consumables all carried a greater price tag. The research also noted that in certain hospitals, lodging rates were more than those at 4-star hotels.

For the past few years, CCI has been researching the Indian pharmaceutical industry. It issued a warning against companies abusing the Covid-19 pandemic and breaking competition laws in April 2020.

According to the report, the inquiry and sanctions may aid in lowering the cost of pharmaceuticals and equipment. They might also increase the healthcare industry’s transparency.

The hospitals were selected based on the number of doctors, paramedics, beds, and patient turnover. Additionally, many institutions do not permit patients to purchase consumables, tests, gadgets, or medications from outside vendors.

The CCI delivered the investigative reports to the hospitals on July 12, 2022, according to the report. These hospitals were found to charge more than other manufacturers for consumables like syringes and blades as well as tests like X-rays, MRIs, and ultrasounds.

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