Centre’s Stand on Healthcare Rate Regulation
The Central Government has asserted before the Supreme Court that a rule mandating private hospitals to adhere to government-set pricing ranges for medical procedures aligns with constitutional standards. This declaration, however, comes amidst an acknowledgment that the pricing range is yet to be finalized due to a lack of unanimous agreement among states. This position was articulated in a counter affidavit submitted by the Union Ministry of Health and Family Welfare. The affidavit was filed in response to a petition by the All India Ophthalmological Society challenging Rule 9(ii) of the Clinical Establishments (Central Government) Rules, 2012. This rule necessitates hospitals to charge within a price range determined by the Centre in collaboration with States.
Arguments from the Petitioners
The petitioners argued the impracticality of enforcing uniform pricing for specialists in metropolitan areas and those in smaller towns and rural regions. The Supreme Court initially heard this matter in April 2024. During this session, Justices Sudhanshu Dhulia and Prasanna B. Varale noted the frequent failure of hospitals to honor commitments made when acquiring land at subsidized rates, specifically the reservation of beds for economically disadvantaged patients.
Centre’s Defense of Rule 9(ii)
In its defense, the Centre emphasized that Rule 9(ii) is rooted in the State’s duty under Article 47 of the Constitution to enhance public health. The Clinical Establishments Act, 2010, which frames this rule, was enacted to manage the largely unregulated private healthcare sector in India. The Centre dismissed the petitioner’s claim that the rule violates Article 14 of the Constitution by enforcing equal treatment of unequal patients. The rule, according to the Centre, does not enforce a single price but allows hospitals to set charges within a defined range, factoring in infrastructure and service quality.
Public Interest and Constitutional Rights
Regarding the challenge under Article 19(1)(g), which safeguards the right to practice any profession or business, the Centre argued that medical practice involves public interest, warranting reasonable restrictions under Article 19(6). It likened this regulation to price controls in other sectors like pharmaceuticals and cinema, which the Supreme Court has previously upheld. Furthermore, the Centre contended that standardizing rates supports the right to health under Article 21 by preventing arbitrary pricing and making healthcare costs predictable for patients and insurers.
Challenges in Implementation
The affidavit candidly addressed the stalled implementation of this rule, citing the necessity for active state participation as health is a state subject. Despite numerous consultations and meetings since March 2024, a consensus on pricing has not been reached. States have expressed concerns that a uniform pricing framework might overlook regional disparities in healthcare costs, potentially affecting care quality and deterring investment in medical innovation.
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Current Adoption and Future Outlook
The Centre highlighted that nineteen states and Union Territories have adopted the central Act, while seventeen have separate clinical establishment laws. Although many require hospitals to display prices, they lack provisions for government-determined rate ranges. The Centre also referenced existing government health schemes, such as Ayushman Bharat, noting a decrease in out-of-pocket health expenses from 62.6% in 2014-15 to 43.4% in 2022-23. It urged the Supreme Court to dismiss the petition, arguing that healthcare affordability is being tackled through multiple channels.
