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Radhika Jain on Healthcare in the Public and Private Sectors

Ideas of India

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The Implications of Reimbursement Rates in the Indian Hospitals

The government decided to revise its reimbursement rates for different services. The idea was that, well, there was some suspicion that these reimbursement rates were too low. And so the hope was that when you increased the reimbursement rates, you're paying hospitals more for doing something. You should see in increase in volumes, what hospitals should be more willing provide these services. But this kind of depends on on the sort of assumes a competitive marketre but even if you think about it, if a hospital has mono power, it may not actually face the incentives to pass on the benefits that its gettin in te pass on these high payments to patients.

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