New Delhi: A parliamentary committee has recommended the government set up a statutory body to cap charges for essential medical procedures and diagnostic tests and that all hospitals publish a standardised list of charges, as it flagged wide variations in healthcare costs across public and private hospitals.
In a report on ‘Affordability and Accessibility of Healthcare Facilities in Public and Private Sector’ tabled in the Rajya Sabha last Friday, the Department-related Parliamentary Standing Committee on Health and Family Welfare said the lack of a common pricing framework was driving up out-of-pocket spending, particularly for low- and middle-income families.
The committee said the “stark disparity” in healthcare costs between public and private institutions severely compromises patient welfare and that out-of-pocket expenditure remained “unsustainably high” for poorer and middle-income households.
It recommended that the health ministry establish a national statutory body to set and enforce caps on essential procedures and diagnostics. It also asked the government to require all healthcare facilities to publish a unified, transparent ‘Schedule of Charges’, based on the model followed by Tata Memorial Centre (TMC) in Mumbai.
The recommendations came after the committee examined healthcare affordability and accessibility and heard evidence from health regulators, hospital accreditation bodies, the National Pharmaceutical Pricing Authority and the country’s drug regulator.
Why panel want a common pricing system?
The committee said patients often face large differences in the cost of the same treatment depending on whether they go to a public or private hospital.
It recommended a standardised, evidence-based treatment protocol across secondary and tertiary-care hospitals. The proposed statutory body would determine the permissible charges for essential procedures and diagnostic tests.
The panel said a common Schedule of Charges should be publicly available on hospital websites and other platforms. This, it said, would help prevent “arbitrary pricing and unwarranted clinical investigations”.
The recommendation is aimed at giving patients a clearer idea of the cost of treatment before they agree to procedures or tests.
Room charges should not exceed three-star hotels
The committee also raised concerns over high hospital room charges, particularly in large metropolitan cities. It said some private hospitals “levy or charge large amounts for hospital stays” and that room tariffs need to be rationalised urgently.
The panel acknowledged that room charges vary because hospitals differ in infrastructure, services and operating costs. But it recommended that the basic room tariff in private hospitals in large metros should not exceed the average room tariff of three-star hotels in the hospital’s vicinity.
The benchmark should be made mandatory, it said.
Costs such as resident doctors, nursing, disposable consumables, meals and laundry could be added separately to the basic room tariff so that the overall cost remains transparent.
‘Patients should know treatment costs upfront’
The committee also recommended a legally binding estimate of treatment costs before patients undergo complex or prolonged medical procedures. It said this was especially important for diseases such as cancer, where treatment is often multi-stage and the final cost can be difficult for families to predict.
The committee said patients should be protected from “financial unpredictability and mid-treatment billing shocks”.
It, therefore, recommended that all tertiary-care hospitals provide a comprehensive, legally binding upfront cost estimate before beginning complex or prolonged treatment.
Hospitals should also appoint dedicated financial navigators, specialised counsellors who can help patients understand treatment estimates, insurance limits and available philanthropic support.
The committee said this would allow families to plan their finances before treatment begins, even where the final cost may change depending on the patient’s condition.
Insured patients should not be charged differently
The panel also raised concerns over dual pricing, where hospitals charge different rates for the same treatment depending on whether a patient is insured or paying out of pocket.
It said private hospitals should not be allowed to increase charges simply because a patient has health insurance, as this can raise the cost of treatment for both insurers and patients.
The committee described the failure to prevent such practices as a regulatory concern and recommended that the Insurance Regulatory and Development Authority of India (IRDAI), which regulates the insurance sector, introduce a clear policy explicitly prohibiting dual pricing.
It also recommended mandatory integration of hospital billing systems with the National Health Claims Exchange (NHCX), a digital platform meant to streamline the exchange of claims and billing information between hospitals and insurers.
The panel said the IRDAI should issue strict directions for hospitals to integrate the NHCX with their billing systems and impose penalties for delays.
Ayushman rates also need a rethink
The committee also questioned how treatment rates are fixed under the Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY), the government’s health insurance scheme for eligible families.
Citing the Comptroller and Auditor General’s 2023 report, it said the National Health Authority had fixed some treatment rates using existing central schemes and state averages instead of detailed local cost studies.
The panel said rates below the actual cost of treatment have made it difficult for some major private hospitals to remain in the PM-JAY network.
It recommended fresh, localised cost studies and revision of the rates to reflect current treatment costs.
(Edited by Sugita Katyal)