Eye on revenues, private labs wary about testing all for free


Public health experts fear that the Supreme Court’s order directing private diagnostic laboratories to make covid-19 tests free of charge could result in some of them turning away people, rather than providing free services, at a time that India needs to test more to track the spread of the disease.

Private hospitals are reluctant to test free of cost, saying that it will impact their already dwindling revenues. Many private hospitals had to set aside beds for treating covid-19 patients following a government order, even as patients postponed elective surgeries, considered lucrative for hospitals, wary of contracting an infection.

“The Supreme Court could instead have directed the Centre to supply consumables to the laboratories,” said Suryadev, Delhi state secretary, All India Medical Laboratory Technologists Association.

“Private diagnostic laboratories cannot afford to do free covid-19 tests unless the government offers them some aid. The laboratories can operate on a ‘no profit-no loss’ model during the crisis but free testing will result in a total loss,” he said.

The court had suggested in its interim order that the government work out a reimbursement mechanism for private laboratories, but hospitals are worried.

A Bengaluru-based health expert said private laboratories would probably refuse to do tests despite this being a public health crisis.

“We are almost at stage 3 of the spread of the virus. It is at this stage that we need to be extremely cautious and test as many people as possible and isolate them. So far, India has tested a mere 120,000 people for a population of 1.3 billion. We cannot afford to undo our efforts so far,” the expert said.

World Health Organization director general Tedros Adhanom Ghebreyesus has said that a lockdown alone might not contain the pandemic and rapid testing was essential, especially for a country such as India with a huge population.

Shortage of testing kits and delayed government approvals have already slowed the process of testing in India.

A covid-19 testing kiosk in Ernakulam, Kerala
A covid-19 testing kiosk in Ernakulam, Kerala (Photo: Reuters)

Private hospitals agreed that they have a social responsibility to help the government during this pandemic. However, the decline in patient numbers and consequent fall in revenue has impacted their bottomline, they said.

Earlier, the price of the test in a private laboratory had been capped at 4,500. “This was lower than what it actually cost us to conduct the test. How are we expected to do this for free? We are ready to do it on cost-to-cost basis,” said Dr Deepak Sadwani, founder, Prognosis Laboratories, one of the private covid-19 testing facilities in Delhi. “We have invested a considerable amount of money in inventory required for testing,” he said.

Dr K.N. Sridhar, founder of Cancyte Technologies, one of the three private covid-19 testing laboratories in Bengaluru, said the cost of protective gear for staff, testing kits and salary for laboratory technicians have to be factored in. “Who will pay for all these? What the government should do is provide us these consumables and reimburse sample testing expenses in a week or 15 days,” he said.

Biocon Ltd managing director Kiran Majumdar-Shaw has said private laboratories have already done 10% of the tests free of cost and has appealed to the Supreme Court to review its order to make tests free.

Hospitals said various state governments owe private hospitals crores of rupees as reimbursement under the Central Government Health Scheme and other programmes. “At this juncture, to put additional burden on us is unacceptable,” said Dr U.S. Vishal Rao, chief of head and neck oncology at Bengaluru’s HCG Cancer Centre, which runs Strand Life Sciences, an approved covid-19 testing laboratory.

All India Drug Action Network (AIDAN) and other health groups had earlier written to the government, asking it to make testing and treatment for covid-19 free. “The SC interim order is welcome and in sync with a public health approach that is focused on limiting the outbreak and removing barriers to testing that could place individuals at risk because they cannot afford to pay for tests,” said Malini Aisola, co-convener of AIDAN.

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