GST cut creates drug shortage in MP government hospitals:Out of 530 essential medicines, 200 are missing; emergency services, surgeries, and patient care affected

Government hospitals in Madhya Pradesh are facing a severe shortage of essential medicines. District hospitals are currently running out of basic supplies such as gauze, bandages, multivitamins, and antibiotics.
In an investigation, Dainik Bhaskar has uncovered that the state’s Essential Drug List (EDL) includes 530 types of medicines, but 200 critical drugs and surgical items are currently unavailable in hospitals across the state.
If the situation persists, the stock of several life-saving medicines may be exhausted within the next two months. GST cut and procurement delays During the investigation, Bhaskar found that the shortage is linked to changes in GST rates implemented at the end of September this year. While GST on several medicines has been reduced, the state health department was required to initiate a new Rate Contract (RC) process for procurement at the revised rates.
The Madhya Pradesh Health Corporation, which procures medicines through RCs and distributes them to government hospitals based on demand, has not yet completed this process for all items. This has led to the current shortage. Critical medicines in short supply: Some of the key medicines and surgical items currently missing include: Impact on patient care The shortage is directly affecting patient care, emergency services, and surgical operations. Many surgeries have had to be postponed. In some districts, hospitals are forced to procure medicines locally at higher rates due to the delay in RC approvals. Doctors at district hospitals and medical colleges have reported instances of medicines being purchased at prices above market rates. Concerns over local purchases and rising costs To address the ongoing shortage, officials are considering increasing the limit for local purchases from 20 percent to 30 percent. However, since medicines are already being bought at higher-than-market rates under the current limit, the increase could further raise costs. “Rate contracts for medicines on the EDL that have not been renewed are now being prepared. After the GST changes, the prices of some items need to be revised. There are over 48 items whose rate contracts have not been finalized for 4–5 years. Discussions are underway with medical college doctors to raise the local purchase limit to 30%,” said Mayank Agrawal, MD, Madhya Pradesh Health Corporation.