Ongoing COVID challenges, decline in OPD footfalls, and higher cost of consumables continue to cripple Healthcare in India: President, FICCI

Sep 17, 2020

NEW DELHI, 17 September 2020: Dr Sangita Reddy, President FICCI today said that COVID-19 and the subsequent lockdowns have accentuated the financial distress of the healthcare sector, which is at the epicentre of this crisis. The hospitals that were already financially fragile over the past few years have been stressed with the unplanned investments for COVID-19 preparedness and response; and have seen their revenues topple due to a 60-80 per cent decline in patient footfalls, leading to estimated operational losses of Rs 4500 crores per month (at 50 per cent revenues and 35 percent occupancy levels). 

 

Speaking about the healthcare crisis in the country, Dr Reddy further expressed that the ongoing COVID related challenges, decline in OPD footfalls, and higher cost of consumables continue to cripple the healthcare sector in the country. She further explained that many small hospitals and nursing homes in Tier II & III cities have become non-operational due to the challenges of liquidity and cash flow, numerous have been shut down. The hospitals are now facing acute financial distress given that they need to keep all their services and facilities functioning to be able to provide healthcare services to the citizens. 

 

Adding to the list of existing woes is the demand for oxygen that has risen exponentially. Hospitals and care centres have been consuming up to around 2,700 tonnes of oxygen every day this month, compared to 750 tonnes in April, according to data obtained from All India Industrial Gases Manufacturers Association. Oxygen for medical use typically accounts for 15 per cent of overall supplies, and while the demand has skyrocketed, manufacturers are reportedly not able to meet the requisite numbers. 

There has been a significant increase in the price of medical oxygen cylinders in past couple of months. While the rate per Cu.M of liquid medical oxygen in Kolkata was priced at Rs 13.44 in February, it had risen to Rs 15.68 in September. Similarly, Hyderabad saw a steep rise in price from Rs 20.72 to Rs 40.32 rate per Cu.M of the Bulk D type oxygen cylinder.  

A survey conducted by healthcare industry body NatHealth earlier this year had suggested that hospitals in Tier 1 and tier 2 cities were experiencing a 78 per cent reduction in OPD footfalls, and a drop of 79 per cent in in-patient admissions. A recent analysis by FICCI and EY shows 50-60 per cent revenue drop in April-June quarter and 30-40 per cent revenue drop in July-August for the hospital sector.

 

Even as India gears up for a gradual and a complete Unlock, there is no denying that low financial performance, deferring elective surgeries, and restrictions on international travel will continue to contribute to low footfalls from national and international patients, she further said. 

 

Post lifting of lockdown, private hospitals in the country have recently been witnessing a surge in footfall of non-COVID patients seeking admission. They are sicker and suffering mainly from serious diseases like cancer, heart ailments, chronic kidney, and liver disease, requiring transplants, severe pulmonology issues, etc., that require surgical procedures and intensive care treatment. 

However, since a significant part of private hospitals' bed capacities have been reserved for COVID patients (based on directions of the Govt. of NCT) and as per information publicly available, the current occupancy on such beds is in the range of 55-60 per cent. Therefore, the hospitals are facing severe constraints and strain on bed capacity for treating Non-COVID patients, which is presently running near full, she further expressed.   

Further, there are challenges related to human resources - training the staff for COVID-19; need for more doctors and nurses on roll; and provision for their transport and lodging in many areas; taking care of their staff that are turning positive or getting quarantined during the treatment of COVID patients.  

  

Private hospitals have also been at the frontline of COVID-19 response and have invested in procuring large volumes of essential medical supplies like PPEs, respirators, etc. They have been spending a significant amount in making their facilities pandemic-ready and restructuring them for COVID and non-COVID treatment, creating isolation and quarantine facilities as well as fever clinics. While competent healthcare is the need of the hour, the government also needs a more focused approach towards this sector.