Thousands of medical graduates being churned out every year form a willing pool of candidates for the new-age hiring model of private hospitals – that of salaried doctors. 

The following is an excerpt from Abantika Ghosh’s Games Hospitals Play published by Bloomsbury India.

At the dawn of private healthcare in India, when the East India Company set up a hospital in Fort St. George in Madrasapatnam in 1664, the doctors and the trust that patients had in both their skill and their integrity have been the mainstays of the healthcare business. Healer, the biography of Dr Prathap C. Reddy, by Pranay Gupte paints a candid picture of how Apollo Hospitals built its reputation with renowned names in oncology both from India and abroad such as Dr Vijay Anand Reddy, Dr Harsh Dua, Dr Umanath Nayak, Dr S.V.S.S. Prasad and Dr Jonas Stumpf from Budapest, who was roped in to operate the high dose Selectron – a radiation machine – and continued with Apollo for several years afterwards. A famous doctor added to the prestige of a hospital and brought in patients. Sometimes the patients would change hospitals too if the doctor switched jobs. 

Abantika Ghosh’s
Games Hospitals Play,
Bloomsbury India (18 November 2025)

A pulmonary medicine doctor who has worked at a private hospital for 23 years claims that he has never taken any salary from the hospital. ‘In fact, I used to pay 10 per cent of my fees to the hospital,’ he says. ‘That gave me the freedom to practise my medicine with integrity.’ He says that when the management asked him about the low admission rate, he dismissed them half jestingly: ‘I am a good doctor, so I can heal patients just in the OPD.’ There would be occasional queries about why he was prescribing so few tests, and he would tell them he used his own professional discretion to analyse patients and would not just have tests done because somebody wanted him to. If the conversation got any more intense, the doctor could counter the mounting pressure by reminding them that they did not pay him a salary. In fact, it was he who paid them a part of his earnings, in return for using their facilities to see patients, so he would continue to rely on his own clinical judgement rather than give in to extraneous considerations. ‘Hospitals have now understood the flaw in that system,’ he says. ‘Hence the advent of the salaried consultant doctor who is beholden to the hospital and has no choice but to prescribe as many diagnostic tests and admit as many patients as his “targets” demand.’ For these salaried employees, the patient’s insurance status is almost as important as their vital signs. 

The number of doctors on monthly salaries are steadily increasing as corporate hospitals work on further diluting the doctor–patient relationship by making the doctor faceless and nameless. It is the hospital that the patient goes to. In Vellore, for example, a patient may go to Shankar Nethralaya, but they rarely ever look to consult a specific doctor there. They place their trust in the institution rather than the individual. ‘That is the model that private hospitals now want to emulate to shift the power dynamic within the system,’ says a senior doctor who has lived the transition. The effort is to subtly shift the pivot from the doctor’s personal fame to the reputation of the hospital. Corporate hospitals continue to advertise ‘acquisitions’ of reputed senior consultants but most of the younger doctors are on a monthly retainership. 

A Kolkata-based anaesthesiologist, who is not affiliated to any hospital, explains to me how the decision-making gears in corporate hospitals have gradually moved from the clinician or surgeon to a cadre of employees who specialise in business and finance and are adept at reading balance sheets but not necessarily MRIs and CT scans. ‘There is no right or wrong in this,’ he says. ‘In fact, with the government not fulfilling its responsibility of ensuring quality healthcare for the people, the private sector has become the only option for a large proportion of the population.’ Private hospitals have costs – the infrastructure, equipment, utilities and staff salaries – that need to be covered. ‘Businesses need to sustain themselves, so the CEOs of every big hospital now are people from a non-medical, business background,’ he continues. ‘It is inevitable that they will ask doctors who are employees to do things that are in the interest of the hospital over that of the patient.’ 

In recent years, the Indian healthcare industry has emerged as a destination for multinational investors looking for quick and safe returns. Singapore-based investment firm Tamasek acquired a stake in the Manipal Hospital Group recently, while Apollo Hospitals has tied up with another Singapore-based entity called the Parkway Group for establishing the Apollo Gleneagles Hospital in Kolkata. Malaysian fund Khazanah too has been sporadically investing in Indian healthcare. Many doctors feel that this set of new entrants have also changed the healthcare business, bringing in a sharper focus on the profitability benchmark and bringing in more cutting-edge professional approaches to the way hospitals are run, maximizing resource and manpower utilisation. The infusion of funds has also helped Indian hospitals access the latest medical technology, making them preferred destinations for patients from around the world, not just within the country. 

Another senior doctor, who has been in practice for over three decades and seen this transition firsthand, elaborates: ‘We see a trend now of multinational investors and companies increasingly adding Indian healthcare companies to their “portfolio”. The raison d’etre of these companies is returns on their investments so safeguards are being put at all levels to secure that. This is where the senior management comes in, to ensure facilities are used and monetised to the maximum extent possible.’ 

While there is a lot of medical literature available about the overuse of diagnostic tests in hospitalised patients, most of these studies were unfortunately not done in India. There is no analysis about whether patients with health insurance are subjected to more tests than those without, but anecdotally, that does seem to be the case. This is because despite the insurance companies’ intense scrutiny of the hospital bills, there is enough room for clinical discretion for some additional tests to be slipped in. 

The insurers cannot deny payment for those tests as they could be medically justified. Some such tests that are commonly overused internationally are the echocardiography, endoscopy and colonoscopy. 

A resident doctor at a Delhi hospital, who has had the experience of working with several different departments, explains, ‘Screening tests are often overused, particularly in elderly patients. A doctor who has not had a clear diagnosis for a patient with gastrointestinal problems may ask for an endoscopy or a colonoscopy more readily when they know that the extra charges would be covered by insurance,’ he reveals. ‘And they have a perfectly legitimate reason to do so. This is also true for prostate screenings or urine culture tests. It is very difficult for anybody who is not a clinician and has not faced exactly the same situation in an identical patient to decide whether the tests were required or not.’ A Mumbai-based gastrointestinal surgeon says that his colleagues ‘have an obsession with the orifices of the human body and regularly recommend invasive procedures such as endoscopy and colonoscopy. I call it orificeology – this obsession doctors have with the orifices of the human body. You probably do not know of any person without some GI [gastrointestinal] symptoms. These are the perfect candidates for endoscopy.’ Either procedure could cost over Rs 5,000 at a private hospital. 

There are many such discretionary tests. In some cases medical device companies incentivise the uptake of tests by marking up the prices of consumables so that hospitals can also keep a margin there in addition to the price of the test. An internal medicine consultant uses the example of a machine that can be used for point of care tests in cases of cardiac arrest or pulmonary embolism to illustrate this. It can measure the level of a protein called troponin in the blood and reveals if the patient has had a cardiac event and how recently it may have occurred. It can also perform the D-dimer test for blood clots and is very good for diagnostic purposes if used for the right patient. 

‘The machine costs about Rs 2.5 lakh to Rs 3 lakh and a single use kit is priced at Rs 2,100, but the hospital charges Rs 9,000 for the test,’ reveals the consultant. ‘If a patient has insurance, he is more amenable to undergoing the test. The cost of the machine can be recovered several times over within a year. For a doctor who is not mindful of the patient’s bill – or if he is actively looking to raise it to meet the targets set by management – this test is prone to overuse.’ Another commonly overprescribed test in surgical patients is viral serology, which looks at infections such as hepatitis A, hepatitis B and HIV (human immunodeficiency virus). Hospitals say that the test needs to be done to protect the OT staff against inadvertent infection that can happen if somebody accidentally pricks themselves during the surgery. The test costs anything between Rs 1,500 to Rs 2,000, and is ‘one of the most useless tests’ in the opinion of a Delhi-based surgeon working at a top hospital. ‘There is no justification for doing it for a patient without any history of risky behaviour or symptoms that may warrant this test. Laboratories make millions from this totally unnecessary test,’ he declares. His opinion is that because these infections pop up about once in six months, the risk is not that high. Another aspect of the corporate hospital’s business model is that the ones with a laboratory will insist on all tests being done in-house, claiming that all others are prone to inaccuracies. If there is no laboratory then samples will usually be sent to pathlabs with which there is a prior understanding. ‘Some hospitals continue to do COVID-19 tests – again, without any medical justification,’ says the surgeon. With the infection making a transient and fortunately feeble comeback in the summer of 2025, this practice may have got an additional lease of life. 

Preventive HIV testing has now been normalised by corporate hospitals to the extent that it is no longer questioned. 

In the decades since the unravelling of the structure of the DNA in 1953, technologies such as polymerase chain reaction – widely used for the detection of the SARS-CoV-2 virus during the COVID-19 pandemic but also well established as a cutting-edge diagnostic technique from much earlier – and advancements in microscopy have established the importance of modern technology in medical diagnosis.5 However, the importance of physicians remains paramount, as it is their clinical acumen and balanced decision-making that are key to the optimum usage of all diagnostic techniques. Used correctly, they can revolutionise patient care. But they can equally well become tools to increase healthcare costs, should doctors shun conscientious decision-making. 

The pulmonary medicine consultant mentions a ‘fantastic’ PCR-based test that can analyse sputum or lower respiratory tract samples from a patient with a lung ailment and identify the nature of the organism from among 22 viruses and 17 bacteria. This is a boon particularly for unconscious patients on ventilators. But at Rs 25,000 per test, it can put unnecessary financial stress on a patient if it is not actually required. The test only costs about Rs 16,000 to the hospital, so the markup is significant. It is down to the doctor to choose between clinical and business interests when prescribing the test; in an insured patient the moral dilemma is of course far less. 

Another ‘bread and butter’ test is the fever panel test, which involves several blood and urine tests such as complete blood count (an assessment of all the different types of blood cells), liver and kidney function tests and also a malaria test in some cases. At a pathological laboratory it can cost Rs 600 to Rs 1,200, but at a corporate hospital, a patient would be charged Rs 2,000 to Rs 5,000 for that same test. Almost all inpatients undergo this test, but how many of them really need it? Answers are hard to find. There are similar ‘panel tests’ for diarrhoea, respiratory issues and meningitis, among others, which have replaced disease-specific tests. In the absence of universal and mandatory standard treatment guidelines or an honest prescription audit undertaken either by hospitals or by authorities with the mandate to do so, there is no way to assess the extent of overprescription of diagnostic tests. 

Over the last two decades, the central government has been trying to increase medical manpower after successive estimations by the World Health Organisation (WHO) have found India far below par on that parameter. In 2022, the government of India told the Rajya Sabha that at 1:834, India’s doctor-to-population ratio is better than 1:1000 as prescribed by WHO.6 However, this calculation included alternative medicine practitioners commonly clubbed as AYUSH (which stands for Ayurveda, Yoga, Unani, Siddha and Homoeopathy), which is not the global norm. Besides, there are deep structural and regulatory issues in alternative medicine, including concerns about quality of drugs and standards of training. However, the overwhelming focus on sheer numbers of doctors produced every year has led to quality suffering for the sake of quantity. Tales of inspection teams encountering fake patients and professors in medical colleges are so common that the National Medical Commission recently released guidelines to identify such fakes. It has also led to medical education in the country becoming prohibitively expensive. Both these factors add to the conditions in which the cost of medical care increases. Compromising on the quality of medical education means that new medical graduates have poorer clinical sense, which makes their professional judgement hostage to a large number of tests. On the other hand, their expensive education makes them willing accomplices in corporate profiteering. With huge student loans to pay off, these newly minted medical graduates are more likely to prescribe extra tests to meet the demands of their employers than perhaps the previous generation of doctors. 

The government’s focus on increasing the number of medical colleges has resulted in a mushrooming of these institutes, some with minimal facilities and others with high fees. In 2023, D.Y. Patil Medical College in Navi Mumbai was reported to charge Rs 1.3 crore for a bachelor’s degree in medicine.8 While that may be an outlier, the cost of a medical degree from a private medical college could easily exceed Rs 50 lakh on average. This is a significant shift from the days when students of medicine could get a highly subsidised education at a government medical college and then slowly build a practice. Seats were fewer and competition was fierce, unlike now when virtually anybody who studies bioscience at the plus two level can get enrolled in a medical college. Thousands of medical graduates being churned out every year form a willing pool of candidates for the new-age hiring model of private hospitals – that of salaried doctors. 

This article went live on December twenty-sixth, two thousand twenty five, at fifty-four minutes past three in the afternoon.

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