Consumers BEWARE!
Hospital charges should be transparent


As cost of healthcare, particularly in the private sector, becomes prohibitive, consumers are increasingly complaining of lack of transparency in the pricing of health services. People say that hospitals do not provide a proper estimate of the cost at the time of admission, and even if they do, the final bill will have no bearing on the estimate. Worse, hospitals are unwilling to explain to the satisfaction of the patient or the relatives, many of the charges. In short, there is a demand for a more transparent pricing policy vis-à-vis hospitals. This demand is not unreasonable. In fact in many countries, the law mandates that hospitals follow a pricing policy that helps patients make an informed choice. In Singapore, for example, the Private Hospitals and Medical Clinics Regulations mandate that all private hospitals provide to their patients, on or before admission, full information on the estimated charges likely to be incurred in respect of hospitalisation and treatment. That is not all. In order to ensure transparency in pricing, the Ministry of Health publishes healthcare charges in various hospitals in the public and the private sectors.

If there is misleading or deceptive practices with regard to pricing, people have redress under the Consumer Protection (Fair Trading) Act. If there is gross overcharging amounting to unethical and unprofessional practice, people can also complain to the Singapore Medical Council. It is also mandatory for hospitals to provide a bill, and the bill should give the cost of each item separately and clearly. In other words, the hospital cannot club various charges while billing, but should provide the cost of each item, including consultation, investigation and treatment, separately. Similarly in the US, following the Bush Administration’s initiative in 2006 to usher in transparency in the healthcare service through information on the quality and the pricing of healthcare, as many as 30 states mandate that hospitals provide pricing information to the public. In many states, this information is provided by the Hospitals Association on their websites. There is need for similar initiatives in India, particularly in view of the large number of hospitals that are coming up in the private sector.

In fact, it should become mandatory for all hospitals (both private and government) to make public their charges for various services provided by them. They should not only put out this information on their websites, but also make this (printed) information available to the patients prior to admission. This will not only help consumers make an informed choice, but will also promote more reasonable pricing of health services.

At present, consumers do not really have a remedy against opaque hospital charges or overcharging. Even under the Consumer Protection Act, relief against overcharging is limited to certain situations only. In the case of the Commissioner, Assam State Housing Board vs Manoj Kumar Adhikary, for example, the national consumer disputes redressal commission clarified that “matters relating to pricing may be adjudicated by the consumer forum in cases where price is fixed by law, or there is a deliberate or intentional act on the part of the seller of goods (and provider of services) to take advantage of a higher price of the goods, or there is a price dispute due to unfair trade practice.”

Similarly, in the case of Om Prakash vs Assistant Engineer, Haryana Agro Industries Corporation, the Supreme Court observed: “ The consumer courts have to examine whether by adopting an unfair conduct or practice, a trader has wronged the consumer and compelled him to pay an excess amount.” In other words, since there are no fixed charges for healthcare services, and hospitals are free to charge whatever they want, people can take them to court for overcharging or unreasonable charging, only if there is an element of unfair trade practice in the complaint. Even otherwise, unless the amount is really large, patients may not be inclined to take the case to the consumer court. So all the more reason for the government to think of ways and means of protecting people in the health sector and ensuring that there is transparency in hospital charges.