GST on hospital room rent: Treatment to cost more

NT Correspondent
Bengaluru

Hospitals will soon charge Goods and Services Tax (GST) of five percent if the room rent exceeds Rs 5,000 a day. This was decided at the 47th GST Council meeting held on Wednesday under the chairmanship of Union Finance Minister Nirmala Sitharaman.

This will come into effect from July 18, 2022. Intensive Care Units have been exempted from the tax. The decision will adversely affect patients who undergo treatment at multi-speciality hospitals for serious ailments.

The President of Drug Action Forum (Karnataka) Dr Gopal Dabade opined that companies manufacturing drugs and medical supplies might have pressurised the government. “There are several factors that might have led to the decision. Medical education is expensive, the public healthcare system is weakening, private doctors are being paid to promote certain drugs and prices of essential drugs have gone up recently,” he said.

He said the Karnataka Private Medical Establishment Act mandates the display of all charges on treatment in hospitals. “Many hospitals display it in an inconspicuous way. Patients must be informed about the charges,” he said.

The decision elicited a sharp reaction online too. Former Secretary of Health and Family Welfare, Government of India Dr K Sujatha Rao tweeted, “Hospital services to be charged 18 per cent GST… is there an application of mind there? On hospitals? (sic)”

“We have horrible public healthcare, one of the highest OOP. A 5k/day hospital bed is not really a luxury (sic),” tweeted Dorodi Sharma. (OOP stands for Out-of pocket expenditure, the sum that is paid by the consumer and not covered under insurance).

Another user tweeted that the GST on hospital beds is higher than that on cut and polished diamonds. The GST on Cut and Polished diamonds went up from 0.25% to 1.5%.