Healthcare cost to boom-up after GST implementation

With the attempts to call attention on amplifying accessibility and affordability of healthcare by National Health Policy 2017, to every individual of the country, and the policy also focuses on hindrance of ruling out because of any reason such as economic, social as well as national health mission. But the current Good and service Tax bill have seemed to make it even more difficult mountain to climb through.

India is one of the fastest growing healthcare markets on the plant which completely rely on skilled medical professionals and quality healthcare at an easily accessible cost to meet the demands of every individual. With the implementation of GST 2017, the healthcare cost is going to elevate higher as the service tax on medical equipment and services which have taken up by healthcare providers is going to fall between 12-18 percent.

Listed, below are the impacts of Good and Service Tax 2017 on healthcare.

·       The latest GST has fixed 12 percent rate for medical equipment, 18 percent for a maintenance contract and health insurance. Even though Healthcare has been immune from GST by the government, but the tax on the services consumed by the healthcare providers will be hiked up falling from 3-16 percent after the GST. This will eventually lead to rising in the cost of healthcare delivery.

·       Highly sophisticated medical equipment which drew 12.63 percent will now attract 17.28 percent.

·       Earlier fixed at 8 percent, comprehensive maintenance will now draw 18 percent, which will significantly raise the expenditure of hospitals and in turn make it more expensive for the patients.

·       Labor contract which was drawing 15 percent will now attract 18 percent.

·       Healthcare equipment and devices such as catheters which attracted 10.16 percent will now be taxed at 23.15 percent rate.

·       Hospitals beds will now be taxed at 18 percent rate, which was attracting 11 percent previously.

·       Diagnostic kits, as well as life-saving drugs, will be taxed at 18 percent from 5.5 percent.

·       The expenditure of healthcare providers will rise by 5-10 percent rate.

·       The increase in the cost will be a big challenge for private healthcare providers since they are supplying 80 percent of healthcare needs.

·       The preventive healthcare will become expensive as the health check up draws 18 percent tax.