Pvt. Healthcare Regulation: A Law Blocked for a Decade

दर्द का हद से गुज़रना है, दवा बन जाना 

(When the pain crosses all limits, it becomes the treatment) – Mirza Ghalib

In December 2024, another shocking case of violation of patients’ rights and huge financial demand by a private hospital sparked public outrage and media attention.

During this incident in Pune, the family of 35-year-old Tejaswini, who passed away on December 9, 2024, was forced to resort to a hunger strike outside a prominent private hospital to claim the body of their family member.

The family alleged that despite the ₹52 lakh they had already spent on her treatment, the hospital withheld Tejaswini’s body for an entire day demanding an additional ₹12 lakh. This triggered a hunger strike by the family and community members outside the hospital, asking for the body to be handed over and condemning what they called “heartless and insensitive” behaviour.

Such incidents, where families of patients are exploited in moments of vulnerability, have become alarmingly common across India, and such experiences were further highlighted during the COVID pandemic.

The family alleged that despite the ₹52 lakh they had already spent on her treatment, the hospital withheld Tejaswini’s body for an entire day demanding an additional ₹12 lakh.

They expose the urgent and unfulfilled need for effective regulation of private healthcare— which remains an unrealised agenda despite the enactment of the Clinical Establishments Act, 2010 and related Rules (2012) more than a decade ago.

The unfulfilled legal promise: Clinical Establishments Act, 2010

Since health services come under the purview of state governments in India, the Parliament does not usually make laws on this subject. However, two or more state governments can ask Parliament to pass a law on the concerned area, which other states can later adopt.

Given this context, in 2010, in pursuance of Clause (1) of Article 252 of the Constitution, resolutions were passed by the states of Arunachal Pradesh, Himachal Pradesh, Mizoram and Sikkim, requesting Parliament to regulate clinical establishments, towards ensuring minimum standards for healthcare facilities and services.

Parliament passed the Clinical Establishments Act, 2010 and this law came into effect in March 2012, in the aforementioned four states and all Union Territories. Until now, twelve states— Arunachal Pradesh, Assam, Bihar, Haryana, Himachal Pradesh, Jharkhand, Mizoram, Rajasthan, Sikkim, Telangana, Uttar Pradesh and Uttarakhand— have adopted this Union Act.

The Clinical Establishments Rules, 2012 were further introduced to operationalise the Act, and include crucial provisions such as:

• Clinical establishments must publicly display rates for all treatments and services

• Charges for medical procedures must be according to government-notified ranges of rates

• Standard treatment guidelines must be complied with during the provision of care

While the provisions in the Clinical Establishments Act focus on the registration of clinical establishments, including hospitals, these key regulatory provisions of direct relevance to patients are included in the Clinical Establishments Rules.

If implemented fully, the Clinical Establishments Act and accompanying Rules could standardise healthcare costs, prevent overcharging, rationalise healthcare practices, and reduce unnecessary medical procedures across the country.

Such incidents, where families of patients are exploited in moments of vulnerability, have become alarmingly common across India, and such experiences were further highlighted during the COVID pandemic.

However, more than a decade after its introduction, the implementation of the Clinical Establishments Act has been systematically stalled. Key provisions necessary for implementation, such as minimum standards for hospital registration, are yet to be notified by the Union government.

Such massive delays have led to a situation where hospitals still undergo only provisional registrations, a nominal process that renders the law completely ineffective.

Who is blocking regulation?

There has been a major reduction of momentum for the implementation of the Clinical Establishments Act over the last decade. Meetings of the National Council, which were frequent during the first few years after 2012, significantly decelerated after 2014.

The critically important minimum standards for various categories of clinical establishments (including various types of hospitals) were expected to be notified by 2014, and these would have paved the way for the permanent registration of establishments based on their fulfillment of these standards.

This would have led to effective regulation as expected under the Act and Rules. However, although the draft standards have been displayed on the official website for several years, the mandatory standards for hospitals and most other clinical establishments are yet to be formally notified, a delay of more than a decade.

The primary influence behind the stalling of these essential regulatory measures appears to be the powerful private medical lobby in India, which apparently views the Clinical Establishments Act as an impediment to its profit-driven model.

Certain medical associations and bodies of hospital owners have been resisting price standardisation and other provisions of the Clinical Establishments Act legal framework. It is anyone’s guess why the Union government after 2014 has failed to demonstrate the will needed to implement this important Act, which is urgently required for the regulation of commercial healthcare providers and the protection of patients.

The primary influence behind the stalling of these essential regulatory measures appears to be the powerful private medical lobby in India, which apparently views the Clinical Establishments Act as an impediment to its profit-driven model.

Patients’ rights charter: Protective entitlements that need effective implementation

The Patients’ Rights Charter, circulated by the Union Health Ministry in updated form in 2021, outlines 20 essential rights to safeguard patients from malpractices, along with a set of patients’ responsibilities. Key provisions in the charter include:

• Patients have a right to receive relevant information about the illness, proposed treatment, possible complications and expected costs of treatment. They have right to copy of their medical records, reports and case papers

• The right to receive clear information on the rates being charged for each service, hospitals must prominently display these rates. All patients are entitled to receive an itemised bill. 

• Right to informed consent prior to specific tests or treatment, right to seek a second opinion from an appropriate clinician of patients' choice, and right to choose alternative treatment if options are available

• Rights to non-discrimination, confidentiality, human dignity and privacy during treatment

• Patients are not obligated to buy medicines from the hospital's pharmacy or undergo diagnostic tests at hospital-recommended facilities. They can opt for appropriate external sources offering lower costs

• All hospitals must have a grievance redressal system with a designated officer. If the hospital fails to resolve an issue, patients should be able to contact the district registering authority for further assistance.

• Hospitals cannot deny the release of a deceased patient's body for any reason. 

To effectively ensure these and other important rights included in the charter, they must all be integrated into the minimum standards of the Clinical Establishments Act, which would lead to their implementation in the dozen states that have adopted the Union Act.

Besides the states covered by the Clinical Establishments Act, some others such as Karnataka, West Bengal and Chhattisgarh have incorporated provisions of the Patients’ Rights Charter into their state-specific healthcare regulations. However, nationwide legally backed enforcement is now necessary to ensure uniform protection of patients across the country.

While the provisions in the Clinical Establishments Act focus on the registration of clinical establishments, including hospitals, these key regulatory provisions of direct relevance to patients are included in the Clinical Establishments Rules.

Initiative to break the regulatory stalemate: Jan Swasthya Abhiyan’s PIL

Keeping in view this entire situation, Jan Swasthya Abhiyan has filed a public interest litigation (PIL) in the Supreme Court in 2021 to demand the implementation of the Clinical Establishments Act and the Patients’ Rights Charter. Key prayers of the petition include:

• Enforce implementation of the Clinical Establishments Act and related healthcare standards: Asking for directions to the government to fully implement the Act and related Rules. Ensure that hospitals display their rates clearly, maintain minimum standards, and follow approved treatment protocols.

• Ensure uniform healthcare regulation: Asking for directions to states that have not adopted the Clinical Establishments Act, to either implement this or bring their laws in line with its provisions to ensure consistent healthcare standards across the country, as required by the Constitution.

• Implement patients' rights: Declare that the Charter of Patients' Rights must be implemented in all states and Union Territories.

• Operationalise grievance redressal: Direct the creation of a system for handling patient complaints at the district, state and national levels until the shortcomings of the existing Act are addressed.

Currently, Jan Swasthya Abhiyan’s petition is being heard alongside a similar petition filed by the Veterans Forum for Transparency in Public Life. The latter emphasises the need for rate standardisation, while suggesting that rates established under the Central Government Health Scheme (CGHS) could serve as an indicative framework.

The Supreme Court directed the Union health ministry in February 2024 to propose a framework for regulating hospital rates and implementing the Patients’ Rights Charter. Both PILs have now been tagged together due to their similar nature. However, certain private hospital associations represented by high-profile lawyers have recently filed multiple interventions, challenging the government’s right to regulate hospital rates and urging the court not to intervene on this front.

Resistance from the commercial medical lobby, alternative voices of ethical healthcare professionals

The Indian Medical Association (IMA) and certain other private medical associations have continuously opposed the regulation of hospital rates and other provisions of the Clinical Establishments Act, both within and outside the court.

They are now challenging the government's authority to regulate rates in private hospitals through multiple petitions in the Supreme Court. Their arguments can be interpreted as continuing the privilege of private hospitals to indulge in commercialised practices and profiteering, even though this comes at a huge cost to patients and society.

Not all healthcare professionals share such a pecuniary view. A recent expert testimonial signed by 100 doctors from across India supports the standardisation of healthcare rates and the implementation of the Patients’ Rights Charter.

Not all healthcare professionals share such a pecuniary view. A recent expert testimonial signed by 100 doctors from across India supports the standardisation of healthcare rates and the implementation of the Patients’ Rights Charter.

The statement observes that a large number of private hospitals are already being reimbursed for over a thousand medical procedures at standard rates, under existing official schemes such as CGHS and Pradhan Mantri Jan Arogya Yojana. Drawing parallels with countries like Japan, where standardised pricing ensures equitable access to healthcare, the testimonial demonstrates that such reforms are both technically feasible and necessary in India.

It may be added that some aspects of the Clinical Establishments Act framework require refinement. Standards for healthcare facilities should be kept realistic, considering the challenges faced by smaller and rural hospitals.

District-level bodies should be expanded to include civil society and patient groups to better address the needs of healthcare users. The implementation framework of the Clinical Establishments Act must be equipped with adequate humanpower, to ensure proper execution of tasks such as registration, inspection and grievance redressal.

These issues must be resolved during the rollout of regulation, but should not delay the basic implementation of the Act and Rules.

Need for wider support to move forward

All these issues were discussed in the regional consultation organised by Jan Swasthya Abhiyan on December 20, 2024 in Delhi, which was focussed on sharing critical experiences and demands about the regulation of private healthcare and enforcement of patients' rights.

Health activists and professionals from several northern states participated in the discussions on massive delays in the implementation of the Clinical Establishments Act, key provisions in the Patients’ Rights Charter, and the need to widely mobilise for prompt implementation of existing regulations to protect patients and the public.

Decisions were taken to contact a wide range of health and consumer activists, healthcare professionals and social organisations across the country, to help overcome the current blockage of regulation of private hospitals through collaborative actions including:

• Large-scale circulation of information regarding existing legal provisions, through popular documents on the regulation of private healthcare

• Wide dissemination of the Patients’ Rights Charter, leveraging platforms like social media 

• Organising workshops and meetings at district and city levels, involving social activists, health professionals and affected patients and caregivers. Promoting dialogues with healthcare providers to promote display and observance of the charter

• Strengthening legal action and advocacy for effective regulation of private healthcare

The humongous delay in implementing the Clinical Establishments Act, a law enacted by Parliament in 2010 after considerable deliberation but yet to be effectively operationalised, is not just an administrative failure but is a betrayal of public trust.

Regulation of private healthcare is not just a legalistic detail— as experienced during the COVID pandemic, it can be a matter of life and death for millions of Indians. Commercial medical lobbies cannot be further allowed to hold public interest to ransom anymore.

Every day, innumerable patients continue to suffer at the hands of an unregulated system and every year, millions of Indians are pushed into poverty due to unaffordable healthcare expenses. The raising of voices by diverse sections of society on this urgent imperative is overdue, and the time to translate existing laws and rules into real change is now.

Dr Abhay Shukla is a public health professional and national co-convenor of Jan Swasthya Abhiyan.