Beds empty in private hospitals as Delhi builds Covid capacity
Nearly three of every four hospital beds earmarked for the treatment of patients with coronavirus disease (Covid-19) are lying unused in the city, according to the government’s Delhi Corona app, which stakeholders say is adding to the financial burden of private hospitals.
As on Tuesday, Delhi had 15,330 beds earmarked for Covid-19, including 125 operation beds at the field hospital set up by the Defence Research and Development Organisation, of which 11,236 are vacant, according to the app.
“Almost all big hospitals in the city have dedicated Covid-19 beds. With the number of cases going down and the government strengthening its own facilities—such as setting up a new 1,000-bed hospital in Dhaula Kuan—maybe it is time to start rolling back these Covid-19 beds in smaller hospitals. These hospitals can then start focussing on non-Covid treatment. Once that happens, the bigger hospitals with more critical care Covid-19 beds will receive more patients, helping them financially as well,” Dr Harsh Mahajan, co-chair, FICCI health services committee and the founder of Mahajan Imaging, said.
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At the same time, Dr Mahajan cautioned, “We cannot roll back everything at once, there need to be buffer beds to ensure patients can receive treatment in case there is a surge in cases again. Most hospitals now have isolation facilities that can be quickly earmarked for Covid-19 again, in case the need arises.”
Hospitals say a price cap by the Delhi government on 60% of beds in the third week of June is adding to the problem. The Delhi government had capped Covid-19 treatment rates at Rs8,000 (non-NABH-accredited hospitals) and Rs10,000 (NABH-accredited hospitals, including entry-level facilities) per day for an isolation bed, and Rs13,000-15,000 per day for a bed at an intensive care unit (ICU), and Rs15,000-18,000 per day for an ICU bed with a ventilator.
“For private sector hospitals, patient load reduced to about 20% of their usual numbers during the lockdown, which ate away into their revenues. Treating Covid-19 patients was a fresh revenue channel for them. In fact, some hospitals managed to generate a positive EBITDA (Earnings Before Interests, Taxes, Depreciation and Amortisation is a measure of a company’s current profitability). Then, the government capped the prices. This will again impact the revenue that hospitals can generate. For patients in need of minimal monitoring, the rates are okay, but for ICU patients, the cap price should have been at least Rs25,000 because hospitals have to bear a cost of two or three times more than the number of usual staff (as quarantine norms have to be followed), not to mention the additional cost of PPE kits, etc.,” said Girdhar Gyani, director-general of Association of Healthcare Providers (India) or AHPI, which has at least 10,000 hospitals as its member across 33 states and Union Territories.
Treating the insured
“Insurance associations have also started arm-twisting smaller hospitals into accepting the same capped prices that the government negotiated for cash-paying patients. This should not be done as their rates are pre-negotiated. We have reached out to the government regarding the same because it defeats the whole purpose of cross-subsidy and will further strain the private hospitals,” Gyani said.
The Delhi government spokesperson refused to comment despite repeated calls and messages.
A doctor from the private sector, who did not want to be named, said, “The central government committee had suggested capping the prices for 60% of Covid-19 beds. However, the Delhi government order caps the prices for 60% of the total beds in a hospital. This means the lower prices apply to almost all patients—this includes those paying cash as well as those insured. Insurance companies have pre-negotiated rates with hospitals, and with the government capping in place, even the companies have declared they want to follow the same prices. The hospitals will have to then stop honouring the insurance and promise of cashless treatment.”
“The insurance companies are anyway making profits, with very few people going to hospitals at the moment, but hospitals are actually cash-strapped. Treating a Covid-19 patient is costing hospitals more than they are making,” the doctor said.
Subhash Khuntia, Chairperson, Insurance Regulatory and Development Authority, countered, “When a government gives an order that a certain rate has to be followed across the state, it is applicable to all patients whether they are paying by cash or through insurance. However, we suggested that the insurance companies negotiate prices with the hospital for Covid-19 management as a group. Initially, doctors and hospitals were unaware about how to manage Covid-19 patients, leading to difficulties in fixing rates. Now, I think everyone is in a better position to do so. I think, the hospitals should agree to a fair price so that they remain sustainable and but do not overcharge either.”
Bigger hospitals such as Sir Ganga Ram are better off. “The number of patients dipped significantly during the lockdown; now it is slowly increasing with people becoming less scared of the infection. With interstate travel resuming, I think the numbers will go up further. The hospital needs an occupancy of about 70% to break even; we are currently at 60% probably. But even with prices capped, Covid-19 patients are bringing in some revenue. And, it is our national duty to serve. Hopefully, the situation will get better in the next few months,” Dr DS Rana, chairman, board of management, Sir Ganga Ram Hospital, said.
Another committee set up by the Delhi government in early June had estimated that there would be about 100,000 cases by the end of June, of which about 60,000 would be active (people living with the infection). Assuming the rate of hospitalisation would be 25%, the committee had estimated Delhi would need 15,000 hospitals beds—most equipped with oxygen and ventilators—by the end of June.
But the number of hospitalisations in Delhi has remained between 20% and 25% of the active cases in Delhi.
“It is a very good thing that we did not need as many hospital beds as were anticipated by the committee based on the trends of early June. Delhi is currently in a comfortable position. However, unused beds are definitely a financial burden for private hospitals. At the time when these beds were being converted to isolation facilities, the government had anticipated that all of them would be used and the private sector would earn from them too. But the lack of patients is a problem for them,” Dr Arun Gupta, president of Delhi Medical Council and one of the members of the committee that had estimated the infrastructure need for managing Covid-19 patients at the beginning of June, said.
“Having said that, we cannot start going back on the preparations that have been made immediately, as there is a possibility the cases might go up again,” he said.