Bombay HC’s Nagpur bench quashes govt cap on non-Covid treatment prices for 20% reserved beds

The government had put restrictions on treatment fee for non-Covid patients by issuing two notifications dated April 30 and May 21.

“The impugned directions in the notifications in question violate the fundamental right of petitioners, contained under Article 19(1)(g) of the Constitution of India, to practise any profession or to carry on any occupation, trade or business,” said the bench comprising Justice R K Deshpande and Pushpa Ganediwala. The petition was filed by a medical practitioner, Pradeep Arora, and others.

The bench further said, “The legislature of the state is not competent under Entry 6 regarding public health and sanitation; hospitals and dispensaries in List II (State List) of Schedule VII under the Constitution of India either to frame any law or issue any direction putting cap on or regulating the rates chargeable by the private hospitals for non-COVID patients.”

The bench added, “Neither the Epidemic Diseases Act, 1897, nor the Maharashtra Covid-19 Regulations, 2020, empower the state government to issue impugned directions in notifications in question in relation to non-Covid patients in 20 per cent isolation and non-isolation beds in private hospitals/healthcare providers and nursing homes.”

“The state government is not competent to issue impugned directions, as contemplated in the notifications in question, in respect of non-COVID patients…,” the bench observed.

The court also observed that neither the Epidemic Disease Act nor the Covid-19 regulations empower the state government to regulate prices for 20 per cent isolation and non-isolation beds at private hospitals. The state government submitted that since government hospitals were full with Covid patients, private hospitals have to be roped in for non-Covid treatment for the poor and, hence, 80 per cent beds had to be reserved. The court observed that there was no indication that entire government hospitals were filled up with Covid patients.

The order stated that private hospitals have been ripped off their control over 80 per cent beds and they must be compensated under Section 66 of the Disaster Management Act, 2005.

In a series of three notifications, the state government introduced price capping for treatment at private hospital. On April 30, the state government capped rates of various procedures at private hospitals. Hospitals in Mumbai, Thane, Navi Mumbai, Panvel and Pune, which have an agreement on treatment packages with General Insurance Public Sector Association (GIPSA), cannot charge more than the lowest bed category rates for patients. The GIPSA is a body of government insurance companies that fixes package rates for surgeries in hospitals.

For hospitals not attached with GIPSA package rates, the notification provided a schedule of rates beyond which they cannot charge. For instance, an angiography would cost a patient not more than Rs 12,000, a normal delivery not more than Rs 75,000, a valve replacement was capped at Rs 3.23 lakh, a permanent pacemaker implantation at Rs 1.38 lakh, a cataract surgery at Rs 25,000, and so on.

Items like pacemaker, PPE, intraocular lenses, stents, catheter, balloon, medical implants, and consumables could not be charged more than 10 per cent mark up on net procurement cost.

On May 21, in a second notification, the state government reserved 80 per cent beds at private hospitals and capped prices for Covid and non Covid patients.

The petitioner raised an objection to price capping for treatment of non-Covid patients. In a third notification on August 31, the state government extended the 80 per cent reservation and price capping until the end of November.

Avinash Bhondwe, president of the Maharahstra unit of the Indian Medical Association, has welcomed the HC order. He, however, said, “The government notifications about Covid treatment charges for private hospitals are also unreasonably low. In many other states, including Gujarat, they are much higher. We have been trying to convince the state government about this but in vain. So, we have moved a petition before the Principal Bench on October 1 against unjust capping on Covid treatment charges as well.”