Health Ministry Issues Guidelines to Reduce Capital Costs & Manufacturer Dependency

These directives follow recommendations from a committee formed in April to review and improve the procurement and maintenance of medical equipment.

The Union Health Ministry has directed government-run medical institutions to lower capital costs, decrease reliance on single manufacturers, and embrace technological advancements.

These directives follow recommendations from a committee formed in April to review and improve the procurement and maintenance of medical equipment.

The committee has proposed significant updates to the existing system. Currently, medical equipment is covered by a five-year warranty and a five-year comprehensive maintenance contract (CMC).

What the Committee Recommended?

The new recommendations suggest adjusting certain terms based on the equipment's lifespan.

“For high-end medical equipment with effective life cycle of 10 or more years, the Committee recommends for 2 years’ warranty and 8 years CMC to be taken subsequently. For Medical equipment with effective life cycle more than 2 years & less than 10 years and an estimated cost of more than 5 lakhs, the Committee recommends 2 years warranty and CMC for the remaining effective life cycle period to reduce initial outgo of capital expenditure,” the committee recommended in the report.

For high-end medical equipment with a lifecycle of ten years or more, the committee recommends a two-year warranty followed by an eight-year CMC.

Moreover, for equipment with a lifecycle of between two and ten years and a cost exceeding INR 5 Lakh, a two-year warranty and a CMC covering the remaining lifecycle are proposed.

These changes are designed to address several issues with the current system, including high capital costs, increased customs duties, and over-reliance on manufacturers.

Reportedly, the existing five-year warranty and maintenance contracts often lead to higher initial costs and discourage upgrades to newer technology.

The committee's new approach aims to lower initial capital expenditures, reduce customs duties, and encourage more competition.

By extending warranties and maintenance contracts, hospitals will have access to updated technology at a lower cost, improving patient care, the committee noted.

The Health Ministry has also instructed all AIIMS, Institutes of National Importance (INIs), and other government hospitals to follow these new guidelines when procuring medical equipment and consumables.

In a similar development, the Union Health Ministry recently called on all states to implement 157 Standard Treatment Workflows (STWs) across 28 medical specialties.

Developed by the Indian Council of Medical Research (ICMR), these STWs are designed to ensure uniform standards of care in hospitals and promote the rational use of essential drugs and diagnostics.

In a letter addressed to the principal secretaries of health in all states and Union Territories, as well as to the National Medical Commission (NMC) for dissemination in medical colleges, union health secretary Apurva Chandra emphasized the importance of integrating these workflows into the healthcare system.