Now Reading: Private hospitals oppose cap on room charges despite rising profits
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Private hospitals oppose cap on room charges despite rising profits
Private hospitals have pushed back against a Parliamentary panel’s recommendation to cap room charges at the average tariff of three-star hotels in their vicinity, arguing the comparison is flawed and that price controls would discourage investment. Hospital executives said room charges cover multiple patient-care costs and that profitability is needed for expansion.
The Parliamentary Standing Committee on Health and Family Welfare recommended that room charges be rationalised. Apollo Hospitals Managing Director Suneeta Reddy called the company’s pricing fair and transparent, adding that price increases reflect inflation and rising service costs. Paras Healthcare MD Dharminder Nagar called the comparison between hospitals and hotels flawed, saying hospitals do not offer the same services.
The defence comes despite strong financial results from major chains. Apollo’s consolidated net profit rose from Rs 136 crore in FY21 to Rs 1,505 crore in FY25. Fortis Healthcare reported a profit of Rs 809.38 crore in FY25 after a loss in FY21. Max Healthcare’s PAT rose from Rs 331 crore in FY22 to about Rs 1,631 crore in FY26.
Indian Opinion Analysis
The Parliamentary panel’s recommendation, while non-binding, carries political weight and could shape future regulation. Private hospital room charges are a key driver of out-of-pocket expenses for patients, with many procedures priced according to room category. The comparison to three-star hotel rates is a benchmark meant to make costs more predictable. The industry’s counter-argument, that hospitals are not hotels, points to a deeper issue: unlike hotels, hospitals must cross-subsidise emergency and charity care. The real test will be whether the government pushes for a regulatory framework on pricing, or leaves it to market forces. Watch for the government’s official response in the next parliamentary session.
Source: thehindubusinessline.com
This story was synthesised by AI from the source linked above. Methodology and corrections.
