Abhay Soi Criticizes Proposed Price Cap on Private Hospital Rooms

During a recent earnings call for Max Healthcare, Chairman Abhay Soi expressed concerns over a Parliamentary panel's recommendation to cap room rates at private hospitals. The suggestion, part of a report by the Parliamentary Standing Committee on Health and Family Welfare, proposes that private hospital room charges in major metropolitan areas should not exceed the average rates of nearby three-star hotels.

Soi emphasized the need to balance affordability with the demand for new hospital facilities and investment viability. He stated, "The recent committee report speaks about affordability, but one needs to look at another important aspect, which is the need for new hospital beds and viability. Both need to go hand in hand."

He further noted that the healthcare sector requires substantial investment and a conducive environment to foster growth and expansion. Soi added, "We believe the sector will require a lot more capital and you have to have an environment which is both viable and conducive to investments for hospitals to be built."

Max Healthcare's Expansion Plans Unaffected

Despite the proposed price restrictions, Soi assured stakeholders that Max Healthcare would continue with its expansion plans. He highlighted the company's efficiency in healthcare provision and suggested that any policy changes could present opportunities for consolidation. "If there is going to be any sort of risk-free returns available or if there’s any viable proposition for anyone to set up hospitals, we believe we will have superior returns relative to that," Soi explained.

Hospital Admissions: A Doctor-Insurer Matter

Addressing the General Insurance Council’s new guidelines on hospital admissions, Soi clarified that the decision to admit patients should rest with doctors and insurance companies, not hospitals. The guidelines aim to reduce unnecessary hospitalizations and manage rising insurance claims by standardizing admission criteria for common illnesses.

Soi stated, "A hospital does not admit a patient, a doctor admits a patient. This is a matter between insurance companies and clinicians. If the doctor says admit the patient, we admit the patient. If they say admission is not required, we cannot admit the patient."

The Association of Healthcare Providers (India) has also weighed in, indicating that the guidelines should serve only as recommendations, cautioning against insurers using them to deny claims.