The forty seventh GST Council assembly in June 2022 capped the GST at 5% to be relevant on room hire (excluding ICU) exceeding Rs 5000 per day per affected person charged by a hospital.
When somebody will get hospitalised, one has an possibility to decide on several types of rooms—single personal room, twin sharing, suite room, and so forth. The per-day room hire fees for every of them are completely different and range from hospital to hospital. Under sure well being insurance insurance policies, insurers solely cowl a portion of the room hire or have a cap on the identical (relying on the sum insured opted).
Experts say that the 5% GST on hospital room hire will additional enhance the hospitalisation price in instances the place the hospital room hire is above Rs 5000 for non-ICU rooms.
“Under the new guidelines, a 5% GST will be imposed on hospital room rent above Rs 5,000 for non-ICU rooms. This will result in an overall increase in the hospitalization cost in cases where the per day room opted is higher than Rs 5,000,” Dr Sudha Reddy, Head – Health and Travel at Digit Insurance, informed FE.
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Who pays the GST?
Since the relevant hospitalization prices are sometimes borne by the insurer, the GST fees, too, shall be paid by the insurance firm and there shall be no direct affect on the policyholder throughout declare settlement, in response to Dr Reddy.
Premiums to go up?
Dr Reddy mentioned that if the GST results in an increase in general claims price for the insurers, there may very well be a likelihood of well being insurance premiums going up within the close to future.
What ought to policyholders do?
Certain well being insurance insurance policies have a capping on the hospital room hire. This capping may very well be on the premise of co-payment, the place the insured is required to bear a portion of the room hire from his/her personal pocket or primarily based on the allowance of solely sure sorts of room for hospitalization.
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In instances of co-pay, the insured could need to bear a portion of the room hire price, together with the GST quantity.
“To negate such a scenario, it is advisable to opt for a health insurance policy that does not have any capping on room rent. One should always read the policy document carefully to ensure no additional payment is being charged by the insurer for room rent or any other type of co-payments and additional deductions,” mentioned Dr Reddy.
