Pricing of Hospital Services

A Hospital offers a large number of clinical services and some non-clinical services as well. Patients
availing these services can be Out-Patient, Emergency Patient or In-Patient. In-patient can further be of
categorized as per their choice of accommodation, such as deluxe, semi-deluxe or general ward patient.
Justified charging of services and facilities availed by different categories of patients can be confusing at
times, as it requires a clear understanding of what services or components to be charged and how to differ
the charges for different category of patient. In this post, a simplified explanation of how to price hospital
services to charge it to patient, is presented. This will also help hospitals in developing a comprehensive
document on hospital’s tariff and relevant policies for billing. In addition, you may also like to check this post
on 'How much does it cost to run a hospital?'

For pricing various services of a hospital, services can be grouped under following head.
1. OPD services
2. Emergency services
3. IPD services
4. ICU services
5. Surgical services
6. Medical/Surgical Procedures
7. Diagnostic services
8. Use of Medical Equipment
9. Materials and Consumables
10. Packaged services
11. Other services and facilities

A brief description of each of these services group along-with how are they charged is described below.      
  
     

1. OUT-PATIENT SERVICES 
Most of these services are generally availed by an out-patient and includes following

 First consultation fee – This fee can differ from specialist to specialist or from clinic to clinic and
consultation fee of each specialist doctor/clinic should be specified. However, hospital can choose to have
a policy of standardized rates. For example all speciality consultation at Rs. 500/- and Super-speciality
consultation at Rs. 800/-
 Follow up consultation fee – This can either be same as first time consultation fee or lesser. Many
hospital also offer one free follow up consultation, if follow up is done within one week.  This can also vary
with individual specialist’s choice, if hospital allows for consultant specific pricing.
 Day Care bed charges – Day care services are generally managed under OPD. The beds in day
care are charged at per hour basis and for maximum of 12 hours.
 Medical certificates – A rate for issuance of various types of medical certificates, such as fitness
certificate, sickness certificate etc. can be specified
 Medical/Surgical procedures, use of equipment and diagnostic services – These services, if
used by OPD patient, should be charged as per their standard tariff for OPD patients.
 Materials and consumables – These should be charged as per actual, not exceeding the MRP.
2. EMERGENCY SERVICES
Patients’ seeking certain hospital services on emergency services can be charged on following
components.
 Emergency consultation fee: Generally charged at 1.5 to 2 times of first time consultation fee,
specified in OPD. Another practice is to charge a fix fee for emergency (like Rs. 500/-) in addition to the first
time consultation fee specified in OPD. Hospital should preferably not charge the patient for repeat visit to
emergency if the patient is returning within specified duration (say 72 hours), with same presenting
complaints.
 Triage bed charges – Per hour basis
 Emergency ward / Observation unit – Per hour basis. Maximum duration should be specified
 Ambulance Charges – Ambulance services can be charged for per kilometre distance, with a fixed
minimum charge. ALS and BLS ambulance can be charged at different rate. For example ALS ambulance
at Rs. 35 per km, subject to minimum Rs. 2000 and BLS ambulance charged at Rs. 25 per km, subject to
minimum Rs. 1200/-. If doctor or paramedical staff has to accompany the patient, there charges can be
added additionally.
 Medical/Surgical procedures, use of equipment and diagnostic services – These services, if
used by emergency patient, should be charged as per their standard tariff for emergency patients.
 Materials and consumables – These should be charged as per actual, not exceeding the MRP.
Note - As per the law, patients must be given life-saving treatment by the hospital, irrespective of
payment

3. IN-PATIENTS SERVICES 
Following charges will be applicable on the patients getting admitted in hospital for any treatment
 Accommodation charges – Per day charge, as per category of accommodation
 Nursing charges – per day charge for each category of accommodation
 Assessment charges – This charge is applied toward detailed clinical assessment of the patient
and the regular re-assessments during the duration of hospitalization
 Consultant’s visit charges (professional charges) – Per visit charge of the consultant. This could
vary from consultant to consultant, or hospital may choose to standardize the rates and differentiate the
rates only on the basis of specialists and super-specialists consultant. The fee charged by a referred doctor
should also be considered under this head.
 Junior doctor’s visit fee – Per visit charge of the junior doctor.
 Off hour visit charges – If the specialists visit is required outside the working hour of the doctor, a
separate fee is charged, which is higher than the normal visit charge
 Drug administration charges – This can be linked to the total medicine issued to the patient, for
example 5% of the total cost of the medicine issued to the patient. Some hospital provide this as a part of
nursing charges.
 Medical Record Charges – To create and maintain the individual medical record of the patient
(generally charged about 300-500 rs.)
 Visitor Pass and Attendant Pass – Generally the visitor and patient’s attendant pass is issued free
of cost, however, if the same is lost, a fee of Rs. 100 to Rs. 300 can be charged for re-issuing the same
 Insurance claim support fee – A fixed or variable fee can be charged for carrying out insurance
claim process or cashless process, if the patient is insured. This cost covers the photocopying and
stationary cost and cost of the manpower involved in this.
 Materials and consumables – These should be charged as per actual, not exceeding the MRP.
 Medical/Surgical procedures, use of equipment and diagnostic services – These services,
should be charged as per their standard tariff applicable for the category of accommodation in which the
patient is admitted.

Note – Hospital should have a policy on what charges will be applicable in case, the patient changes the
category of accommodation during hospitalization period. Many hospital, charge the applicable price of the
service for the category of accommodation in which the patient was admitted when the service was
rendered. Some hospital, however, charge the services at the rate of highest category of accommodation in
which the patient was admitted irrespective of category of accommodation in which the patient was staying
when the service was rendered.
Hospital also should have a policy on what charges should be applicable, if the category of accommodation
required by patient is not available and hospital is offering another category temporarily, with an
understanding of shifting the patient to his/her desired category as soon as it becomes available.  Practice
is that the patient is charged for the lower of the category sought and category offered, till the time patient
is not transferred to the desired category.

4. ICU SERVICES 
These are applicable in case the patient had to avail intensive care services
 Accommodation charge – Per day accommodation in ICU. This could differ depending upon type
of ICU, like ICU, CCU, Burns ICU, Neonatal ICU, HDU etc.
 Nursing Charges, Assessment charges, Consultant visit charges should be specified as is
done in IPD, However the charges in ICU can be different and generally priced similar to one of the higher
category of accommodation.
 Ventilator Charges – Per hour and per day ventilator charges to be specified
 Oxygen charges – Per hour and per day Oxygen charges to be specified. Oxygen charges are
generally not applied for patients on ventilator
 Monitor charges – Per and per day basis
 Other equipment charges – As per standard tariff of equipment used applicable to ICU category
Note – The hospital can have a policy on whether the patient be required to vacate the IPD
accommodation when shifted to ICU. In case, IPD accommodation is retained, charges applicable for the
same should be specified. Hospital can chose to charge at a higher price for retaining IPD accommodation,
to discourage non-medical use of their rooms.  

5. SURGICAL SERVICES
Patient who undergo major surgeries as a part of their treatment, has to pay certain charges towards the
surgical services availed by them. These charges typically include surgeon’s fee, operation theatre
charges, Anaesthesiologist’s fee and materials cost.
 Surgeon’s fee – The surgeon’s fee (primary surgeon) can differ from surgeon to surgeon and as
per the level of surgery. Depending upon the risk and complexity, surgeries are classified into different
levels. Surgeon’s fee is often linked to the level of surgery, with higher level demanding higher fee.
 Assistant surgeon’s fee – If assistant surgeon is required, then a fee relative to the primary
surgeon’s fee can be charged. For eg. 20% of the primary surgeon’s fee
 Anaesthesiologist fee – This can be fixed, depending upon the type of anaesthesia. However, with
increasing role of anaesthesiologists in patient safety, expertise and commitment of anaesthesiologist is
becoming more and more important. Hence, there is a trend of linking the anaesthesiologist’s fee to the
primary surgeon’s fee. Generally 25% to 35% of surgeon’s fee is charged as Anaesthesiologist’s fee.
 Operation Theatre Charges – Operation theatre can be charged at an hourly rate and can vary
with the type of operation theatre. Another way of charging operation theatre is as a percentage of
Surgeon’s fee. Generally 75% to 100% is charged towards OT charges.
 Charges in case of multiple procedure or multiple surgeon in one sitting – In surgeries that
involves multiple procedures in one go, or requires more than one surgeon, a policy is necessary to
determine the charges. Many hospital follow the rule on following lines

                 In multiple procedures in one sitting, the procedure with highest surgeon’s fee is charged at
100%, second highest procedure at 50% and third procedure onwards at 25% of their tariff. Other linked
charges, such as OT charges, Anaesthesia charges are calculated on the basis of total  fee calculated for
the primary surgeon
                In procedure involving two or more surgeons, the second or third surgeon’s fee is determined
at a percentage of primary surgeon (like 25%). Other linked charges are only calculated on the basis of
primary surgeon’s fee.
 Surgical materials – The instruments and sterile packs used for surgery is generally covered under
the operation theatre charges. However, things like stents and implants used in patient is charged as per
actual cost, not exceeding the MRP.

  6. MEDICAL/SURGICAL PROCEDURES 
A large number of medical procedures are carried out in hospitals. A standard tariff for each procedure
(speciality wise) should be developed and used while billing a patient. For each procedure, the tariff
applicable in OPD, Emergency, day care, ICU and IPD can vary and should be specified. Within IPD the
tariff generally differs between categories of accommodation, with lower category charged at basic price
and higher category are charged at premium price.

7. USE OF MEDICAL EQUIPMENT 

Various type of equipment can be used on patient during his/her hospitalization, such as Alpha bed, CPAP,
Incubator, Nebuliser, Syringe pump, water bed etc. For each equipment, the charges should be specified
as per time use, per day or per hour, as applicable for the equipment. The charge can be different for OPD,
Emergency, Day care, ICU, and various categories of IPD patients.

8. DIAGNOSTIC SERVICES 
A standard tariff should be available for all the tests available under Laboratory and Imaging department.
Like medical procedures and equipment charges these can also differ for OPD, Emergency, Day care, ICU,
and various categories of IPD patients. In addition, an additional fee can also be charged for carrying out a
procedure bed-side, such as bed-side X-ray.

9. MATERIALS AND CONSUMABLES

Various materials and consumables used on patient can be charged as per actual (not exceeding MRP), if
not already included in package price or any other head. Generally the materials charges are not linked to
the patient’s category of accommodation

10. PACKAGED SERVICES 

It is a trend to develop a package of certain services and offer it at a fixed price. Very commonly packages
are developed for surgical treatments and for health check-ups.
Surgical packages - These package price generally covers, all basic services that is required by patient to
undergo surgery such as accommodation for specified number of days, medical assessment,
investigations, surgery, basic drugs etc. It is important to clearly describe the inclusions and exclusions in
the package, and conditions under which additional charges will become applicable.
Health Check-up Packages. Health check-up is a highly sought after services from the hospital. A hospital
can design various type of health check-up packages and specify a fixed price for the same. Inclusion and
exclusion must be mentioned in such packages.

11. OTHER SERVICES AND FACILITIES

Following are the other services and facilities that are offered by hospital and can be charged to patient, as
per hospital’s policy.
 One time registration fee – This is charged to the patient who has come to the hospital for the first
time. This is to register the basic details and maintain the unique ID of the patient in hospital records. About
100 to 200 Rs. Can be charged for this. Some hospital also chose to offer free registration to patient.
 Food for patients – Charges for routine food, special food, different types of restricted diets etc.
 Food for patient’s attendant and visitors –According to type of food requested
 Cafeteria charges – Item-wise prices
 Telephone charge – For use of STD/ISD/Local calling using hospital’s phone
 Internet Charges – Generally offered complimentary through WiFi
 Mortuary charges – Per hour/Per day basis
 Fee of allied health professionals – Physiotherapist, Dietitian, Occupational Therapists, etc.