Covid-19 Impact: Private Health Care Sector Fearing For Survival; Seeks Govt. Help
The health sector in India, one of the major contributors to India’s economy, is experiencing the wrath of corona virus. Private players describe a sharp decline in the business post lock-down. Elective surgeries and medical tourism were the two biggest revenue generators for the private healthcare business in India which has suffered the most as a result of lockdown, say leading private health professionals.
Dr Alok Roy, Chairman-FICCI Health Services Committee and Chairman, Medica Group of Hospitals says: “We have seen a noticeable downfall of nearly 80 per cent in the hospital business.” Agrees Dr Nandakumar Jairam, CEO, Chairman & Group MD, Columbia Asia Hospitals. “It has strained the healthcare resources of the country as the healthcare sector has to brace itself for many patients, some requiring intensive care, others isolation, all mandated in the management of Covid-19 patients," says Jairam.
Approximately 70 per cent of the healthcare services in India is provided by private healthcare players. In these hard times, the private healthcare sector is looking towards the government’s support for survival.
Dr Jairam adds, “The depletion in the number of patients for elective surgeries (and coming for specialized treatment), has created a financial strain on private healthcare providers.”
The single greatest worry for all private hospitals now, says Dr Harish Pillai, is cash flow management and how to meet both payroll and material costs. Dr Pillai is the CEO of Aster India, Aster DM Healthcare.
If private health care does not survive because of financial considerations then the entire healthcare of the nation will crumble argues Dr Jairam.
“We are running short of cash and manpower....By the time we get through it, a lot of companies may not have money,” adds Dr Roy. Dr Pillai says he will not be surprised if India begins to hear bankruptcy-related closure of numerous hospitals. "This has stressed the healthcare infrastructure considerably," he adds.
How Can Government Help?
The government can support the health sector by getting them emergency assistance loans, tax waivers and clear pending dues from their schemes. “Additionally, if the government can give healthcare a priority sector status that would help the organisations apply for a loan at a reduced or subsidised rate,” suggests Gautam Khanna, CEO of P D Hinduja Hospital & Medical Research Centre.
The economic impact in the coming 2-3 quarters is expected to be disastrous for the private player. “As the Outpatient and Inpatient occupancy volumes have crashed significantly across India impacting revenues big time,” explains Dr Pillai of Aster India whereas according to Dr Roy’s understanding, it will probably take least 6 months to 12 months for recovery.
In addition to these, Khanna says, “We need a structural overhauling of Indian healthcare to make it more sustainable and agile to help cope with new challenges while catering to the needs of such a huge population.”
