The revision of package rates is likely to happen by the end of 2021-22, executives at some private hospitals told ET.
“Though we are a large multispeciality hospital chain with significant overheads, we continue to treat patients at the same rates since 2019 despite non-Covid revenues being affected by the Covid pandemic, rising manpower costs, and other operating costs,” a Fortis Healthcare spokesperson said. “We are evaluating the situation and will decide about package tariff correction at an appropriate time.”
Apollo Hospitals also said it is evaluating the option of raising prices. “The cost of sanitation, consumables, human resources and general inflation are eating into our margins, so at some point we have to pass on the cost,” said Krishnan Akhileswaran, group chief financial officer of Apollo Hospitals. A 5% average annual increase is generally the norm, but this time it may be little higher, Krishnan said. Costs have increased in high single digit, he said.
Both Apollo and Fortis are still 5-6% away from full business recovery to pre-pandemic levels, officials said. An executive at another large, listed hospital chain told ET that it is also actively considering revision of package rates. Alok Roy, chairman of Kolkata-based Medica Superspecialty Hospital, said an increase in package rates are “inevitable” while “the quantum of rise depends on hospital to hospital”.
“We haven’t reached the pre-pandemic levels in terms of recovery, even as costs shot up,” he said. Roy is also the chair of FICCI Health Services Committee. Hospitals earn revenues through three streams – cash-paying patients, bills settled by insurance companies, and institutional patients or those from government schemes like Central Government Health Scheme. Executives said they can increase the price to cash-paying patients.