Mumbai/New Delhi: In a move that could bring relief to millions of patients and transform the way hospitals do business, the health ministry plans to put in place common standards of treatment at medical facilities.

The ministry has mandated an expert panel to frame treatment protocol for a number of ailments that are expected to be implemented in the next three-four months and established at hospitals nationwide in one-two years, three officials familiar with the development said.

The move comes against the backdrop of India’s largest state-owned health insurance firms withdrawing the cashless payment facility for treatment at hundreds of hospitals, alleging that they were over-charging customers who had health insurance policies and leading to huge losses for the insurers.

The move towards standardization follows the recent passage of the Clinical Establishment Act, which calls for common standards to be maintained by healthcare facilities. Every such legislation requires a set of guidelines to be framed.

“An expert committee has been appointed to look at cost-effective ways of standardizing treatments through regulation of hospitals at state level," said a senior health ministry official on condition of anonymity. “Initially, standardization will be done for 10-15 common critical ailments such as those related to cardiology and nephrology."

The ministry is in talks with various state authorities for implementing common standards of treatment at hospitals across the nation, the same official said.

Currently, there are no standard methods of treating ailments or providing standard infrastructure facilities during hospitalization. Because health is a state subject, the Centre can only recommend to state governments that they adopt the Clinical Establishment Act.

The Act will seek to provide uniformity in healthcare delivery, said Dinesh Trivedi, minister of state for health and family welfare.

“Standardization of rates across hospitals in a region would bring in more transparency to customers and insurers. This also helps in pricing the product better than relying only on the insurer’s claims experience," said T.A. Ramalingam, head of underwriting at Bajaj Allianz General Insurance Co. Ltd.

Since standardization of treatments in hospitals has not been mandatory, only four states—Arunachal Pradesh, Himachal Pradesh, Mizoram and Sikkim—and all Union territories have so far agreed to follow standard protocol.

“Many other states reacted positively and the standardization rule could soon be followed in all states in the next few years," said a second health ministry official, who also didn’t want to be named. “This will ensure affordable and accountable healthcare services, and allay concerns of erratic charges at hospitals."

In the absence of the Central regulation of hospitals, many healthcare facilities often prescribe needless tests to their patients, resulting in higher costs. The charges levied vary from patient to patient and hospital to hospital.

Health insurers have been concerned because patients who have medical insurance are often charged much higher fees than non-policyholders for any form of treatment. Besides resulting in losses for the insurers, this has been consuming the health cover limits faster than expected for policyholders.

The enforcement of standard treatment protocol will help minimize the scope for hospitals to overcharge patients by prescribing unnecessary and expensive tests.

National Insurance Co. Ltd, New India Assurance Co. Ltd, Oriental Insurance Co. Ltd and United India Insurance Co. Ltd last month sought the insurance regulator’s intervention to prevent hospitals from producing inflated bills for treatment of patients with health insurance policies.

“Once there is a standard protocol for hospitals, they will not be able to charge extra or treat (a patient) beyond the stipulated protocol," said an official at the Insurance Regulatory and Development Authority.

“This will also limit the liabilities for the insurance companies. But unless we have a dedicated authority for regulating the hospitals, the entire move may only be able to delay the process of spiralling costs of treatment," added the official, who didn’t want to be named given the sensitive nature of the issue and the fact that the guidelines are yet to be framed.

India has 23 non-life insurers, and almost all of them offer health insurance. The four state-owned general insurers have agreed to set up a common third-party administrator in a joint venture to manage health insurance claims. The move may help in settling the row over excessive billing by some hospitals.

At least 449 hospitals have so far agreed to be added in the list of preferred provider network that will provide cashless hospitalization services to health insurance holders. But unless the treatment procedures are standardized, customers of private health insurers may have to continue to pay higher fees than non-policyholders and clients of public sector insurers.

“The standardization could be followed by a mandate for hospitals to publicly disclose the costs of treatments, doctors’ names and qualifications, infrastructure facilities provided, and instruments used at the hospitals. This will minimize the scope of discriminating patients with varying charges," said one of the health ministry officials cited above.

Regulation of hospitals will start with a review of the existing system of clinical establishments (which include hospitals, nursing homes, maternity homes). It would include regulation of professional services and accreditation of healthcare infrastructure to ensure universal access to equitable, affordable and quality healthcare that’s responsive and accountable to patients.

The second stage would be to identify the potential areas involved in providing accreditation to ensure cost-effective and standardized delivery of health services to people in rural and urban areas. The third stage would be to suggest a practical and cost-efficient system of accreditation of healthcare infrastructure.

In the US, accreditation of health services is an established practice and financial resources are allotted to health institutions on the basis of accreditation. Canada, Australia and some European countries, too, follow this practice. In Australia, a star rating is given to hospitals on the lines of ratings for hotels, based on the facilities provided.