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Smaller private laboratories feel pinch as Maharashtra again caps Covid testing rates

In parts of interior Maharashtra, many private labs continue to charge higher rates, claiming that it is necessary for them to survive.

Written by Tabassum Barnagarwala | Mumbai |
Updated: April 27, 2021 9:17:41 pm
Covid, MumbaiMaharashtra is conducting 2-2.5 lakh tests daily, of which 1.5-1.7 lakh are RT-PCR. (Express photo by Deepak Joshi)

The Maharashtra government’s March 31 order further capping the rates of RT-PCR and antigen tests for Covid-19 has hit smaller private labs hard, with many of them saying that the rates are unsustainable and leaves them with little margin to expand capacity.

In parts of interior Maharashtra, many private labs continue to charge higher rates, claiming that it is necessary for them to survive.

In Vashi’s UDC satellite laboratory, CEO Dr Mohit Patil said the latest price cap works for large labs that have massive capacity, but profit margin is narrow for smaller labs. “Our biggest expenditure is paying fees to collection staff who go for home visits. It is difficult to manage with current rates,” he said.

On March 31, in the fourth notification in the past one year, the Maharashtra government announced price capping for RT-PCR test— Rs 500 if person walks into laboratory, Rs 600 for hospital test, and Rs 800 for home collection. Antibody test under ELISA will cost Rs 250 in lab, for home collection Rs 400. Rapid antigen test will cost Rs 150 if done in laboratory and Rs 300 for home collection. CBNAT and TRUNAt test will cost Rs 1,200. After the outbreak of the pandemic last year, the charges for a RT-PCR test in the state were Rs 4,500, which were cut from time to time by the state government to ease the burden on people.

Maharashtra is conducting 2-2.5 lakh tests daily, of which 1.5-1.7 lakh are RT-PCR. Mumbai is conducting 40,000-50,000 tests a day.

Pravin Shinde, regional head in InfleXn laboratory, that processes 4,500 samples a day in Thane, said, “We didn’t expect prices to fall so low, there was no consultation with smaller labs. The only way to earn is through large volume and not every lab has wherewithal to do that,” he said.

Sachin Bhosle, the founder, said since this is a pandemic situation, the government expected labs to not profiteer. “And that is why we are cooperating, we are able to break even,” he said.

Dr Trupti Borse, pathologist in Supreme Diagnostics, Nashik, said investment is required for personal protective equipment, viral transport media (VTM), extraction kits, RT-PCR kits, N-95 masks, plus Rs 100 per kg biomedical waste disposal.

“We have capacity of 1,000 samples a day and I have a staff of 30. It is impossible to test a sample for Rs 500. I have staff salary to pay, and electricity bill has doubled in a year due to high testing load. Operating cost is rising, and the government is expecting us to reduce test rates,” she said.

Sushant Kinra, CEO in Suburban Diagnostics, said cost of VTM has risen from Rs 13 to Rs 26 due to high demand and low supply. The lab does 14,000 tests in Mumbai, Pune, Goa and MP belt every day. “We are trying to expand capacity to meet growing demand, but price cap has hit us bad,” he said.

Suburban Diagnostics shifted its corporate office into a co-working space in a business centre, and converted the old office into a molecular lab to expand space. “The operational cost is high, and test rates are low. I need 100 more people for sample collection. They demand higher remuneration due to Covid risk but margin is too low to manage all this,” he said.

Kinra added that labs are in touch with ICMR to waive import duty on certain testing material.

Sanjeev Vashistha, MD and CEO of Pathkind, said the GST on kits ranges from 5-18 per cent. “But we can’t charge GST from a patient. We need some concession from the government. A lot of human resources is required for data entry operators to feed data on ICMR portal,” he said.

Vashishta plans to open 4-5 labs in Maharashtra in two months. He added that price capping in Harayana, at Rs 499 per test, is forcing small labs to back out due to losses.

The price cap has forced labs to opt for other means to make money. Patients have to pay more to get faster results. Salma Shaikh, a technician who collects samples and supplies to SRL and Metropolis, said she charges Rs 1,500, double the rate fixed by government, but ensures the report comes within 24 hours. “I have to pay some commission to the lab,” she said.

Dr Sudhakar Shinde, who chaired a committee for price capping, refused to comment. A state official said that based on their analysis, consumables and kits cost Rs 150-200, giving ample margin to labs for profit.

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