Bombay Hospital Ordered To Compensate Patient for Illegal Surcharge on Drugs

Sumit Sharma 10 June 2019

Consumer Interest

Bombay Hospital, which has a capacity of more than 800 beds and is also a post-graduate teaching institute, was told its practice of overcharging on medicines sold to a patient while being treated at its main operation theatre was an unfair practice.

The South Mumbai District Consumer Disputes Redressal Forum not only told the premier south Mumbai-based hospital to refund the 20% surcharge it levied on medicines sold to patient Usha Kedia for her orthopaedic surgery, but also granted Ms Kedia compensation for mental agony and cost of litigation.

Complainant Ms Kedia had a surgery performed on her on 25 September 2014, a day after she was admitted, and was discharged on 27 September 2014. The Consumer Forum delivered its order on 22 May 2019.

The total bill for Ms Kedia came to Rs2,10,627, which she paid, and submitted the same to the National Insurance Co Ltd. The company, however, reimbursed only Rs1,66,000 and declined to pay surcharge on medicines of Rs32,570. On other claims, the National Insurance Co also declined to pay Rs19,127 on expenses including pre and post-operative expenditure, and others including excess doctor fees, excess room rent, and other items.

In all, Ms Kedia was short by Rs51,697.

In case of Bombay Hospital, they had levied a 20% surcharge on medicines they procured for the main operation theatre, from a store set up nearby specifically to cater to the operation theatre. The Hospital cited cost of staff and other overheads among reasons for the surcharge. Its own main medicines outlet doesn’t impose any surcharge.

The Hospital went a step further, terming the complaint as an attempt to “tarnish the clean image and bring disrepute to its good name, and to extract money.” The complaint should be dismissed and costs recovered from the complainant, the Hospital contended in its defence.

The Consumer Forum dismissed the hospital’s contention. The Hospital has “miserably failed to justify that levy of surcharge as permitted by law and is illegitimate,” the Forum ruled.

Likewise, the insurance company couldn’t cite any law that enabled it not to reimburse the expenses it rejected.

The Forum, on its own, ordered that the complainant Ms Kedia be paid a compensation of Rs7,500 and costs of Rs5,000 each by hospital and the insurance company, totalling Rs25,000.

Since the case was filed on 21 December 2015, an interest of 9% per annum would be paid to Ms Kedia on Rs32,570 to be paid by Bombay Hospital and Rs19,127 by the insurance company.

Comments

User

JAYENDRA PANDYA

7 years ago

the penalty imposed is minuscule and is not commensurate with the type of their wrong doing and size of their operations. The compensation may be small but the penalty should be such that they do not repeat the malpractice.

These private hospitals do not permit the patient or their relatives to buy medicines from outside in spite of Govt. orders. They threaten, induce panic and black-mail by stating that 'if anything goes wrong we shall not be responsible". Their purchase department always seek medicines and surgical products with highest margins. In addition, they are seeking lowest price and very high consumer price (MRP). Poor patient are not aware if the medicines and surgical products mentioned in the bills were actually used for the patient. They take it at face value and make payment in advance so they are skinned without their knowledge.

Like IRDA, there ought to be an authority or regulatory body to ensure fair practices in healthcare sector. This is required especially in wake of the fact that private healthcare organization are mushrooming without any controls.

Shankar g

7 years ago

The law of land should prevail in such a way to compensate all the users of the Hospital from that year, by ordering the Hospital to make the refund to all those who have been billed +20% , within one month, which shall deter such loot activities in future.

gcmbinty

Replied to Shankar g comment 7 years ago

Support your contention of compensation to complainants on the basis of hospital purchases of consumables hospital equipment with MRP inclusive of all the taxes. In mind must be that the margins of printed MRP on all pharmaceutical products including the equipment and implements are extremely high which jolly well cover the hospital charges for any procedure. There is absolutely no reason for charging additional cess or the costs to hospital.

gcmbinty

7 years ago

This is how the consumer courts should treat the private hospitals for overcharging, charging more than the MRP, the price which is already very high .