Covid-19: Private laboratories struggle with price caps, do only 17% tests

NEW DELHI: A month after the Centre allowed private laboratories to conduct SARS-CoV-2 virus test for Covid-19 cases, diagnostic facilities are finding the economics of ramping up tough and are contributing just 16% to India’s testing capacity.

After manoeuvring the initial hurdle of shortage of testing kits for Reverse Transcription Polymerase Chain Reaction (RT-PCR), private laboratories are still facing multiple logistical issues preventing them from scaling up testing. A look at the latest Indian Council of Medical Research (ICMR) statistics shows, of the 38,000 tests conducted on Tuesday, only 16.75% had been conducted by private laboratories. The Indian Council of Medical Research (ICMR) had brought out the guidelines for testing by private laboratories on March 22, a month back.

Private laboratories – diagnostic centre chains and standalone centres – attribute this to a number of factors. The biggest being the economics of scaling up. Zoya Brar, CEO and founder of CORE Diagnostics, told ET, “The private laboratories are facing a few challenges. With advance payments becoming a norm for all manufacturers and suppliers and deferred payments from hospitals (both private and government), there is a cost pressure. So smaller standalone laboratories are facing challenges in terms of cost and their ability to scale up consequently.”

The cost of Rs 4,500 fixed by the Centre and the confusion in between once the Supreme Court made testing free has also put pressure on private laboratories. Dr Arun Dang, CEO Dr Dangs Lab, said, “The private labs are stretching their limits with the motive to increase testing and provide the highest levels of quality at the shortest possible turnaround time. The government-mandated rate of Rs 4,500 makes this a nonprofit initiative for most labs.”

Despite the Centre fixing a cost of Rs 4,500, there are state governments like Karnataka which have capped the price at Rs 2,250. So the price pressure is on private laboratories. The diagnostic centres also point towards complicated processes followed by government which make it more difficult. “There is a need to simplify processes and prerequisites to make it more convenient for patients to get tested. So far, a doctor’s signature was required on the ICMR form, which has recently been addressed,” said Dr Dang. Finding a doctor to sign the form even after telecounselling during lockdown had been proving very difficult for suspected patients.

The normal inflow of patients has dwindled to about 10% at the diagnostic centres due to lockdown. The private laboratories had hoped to make good the losses with increase in Covid-19 suspected cases. However, laboratory chains point out that the numbers are largely being handled by government hospitals with private individuals making up for a very small percentage. “The testing being done at quarantine centres is all by government laboratories. This has ensured that our volumes remain low,” said another private laboratory chain owner, who did not wish to be identified.

Private laboratory chains are also facing the government’s heat with test results.

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