Supreme Court Issues Notice On Private Hospitals' Plea Against Kerala Clinical Establishments Act; Grants Interim Protection

The Supreme Court today(December 16) issued notice in a petition filed by the Kerala Private Hospitals Association challenging the constitutional validity of provisions of the Kerala Clinical Establishments (Registration and Regulation) Act, 2018 and the Rules framed under it. The Court also directed that no coercive steps be taken against the petitioners till the next date of hearing.

The plea assails, among other provisions, Section 39 of the Act, which mandates every clinical establishment to display the fee rate and package rate of all services provided. The medical bodies have contended that the Act does not define expressions such as “fee rate” and “package rate”, making compliance arbitrary and exposing hospitals and clinics to subjective enforcement by authorities.

The petition has been filed against the Kerala High Court's judgment upholding the Act and issuing further directions, including that hospitals cannot deny life-saving treatment for non-payment of advance or lack of documents. It also directed every clinical establishment to file an undertaking of compliance within 30 days, followed by audits, clarifying that non-compliance would invite regulatory action.

In the Supreme Court, the matter came up before a bench comprising Justice Vikram Nath and Justice Sandeep Mehta. Senior Advocate Gopal Sankaranarayanan, assisted by AoR Zulfikar Ali PS, appeared for the petitioners. He read out the provisions under challenge and submitted that the petitioners were not opposed to the requirement of providing emergency treatment, clarifying that there was no objection to the mandate that life-saving care should not be denied for want of money. He pointed out that the period for provisional registration had expired and that hospitals were now required to seek permanent registration under Section 19 of the Act, which necessitated compliance with all provisions. He requested that interim protection granted by the High Court, restraining coercive action, be continued.

The Court sought the assistance of Solicitor General Tushar Mehta in the matter. Opposing interim relief, Advocate Siddharth Gupta, appearing for a human rights organisation, submitted that the Court should not stay the operation of the Act and argued that for nearly seven years the petitioners had prevented the effective implementation of the law.

After hearing the parties, the Bench issued notice, making it returnable on February 3, 2026. Recording that similar interim protection had been granted by the Kerala High Court, the Supreme Court directed that members of the petitioners' associations shall continue the process of seeking permanent registration under Section 19 of the Act. It further ordered that no coercive measures be taken against them in the meantime.

"Considering the facts, we clarify that members of the petitioners will continue with the exercise of getting themselves registered under Section 19, and the respondent should not take coercive measures in the meantime. Interim order is limited till 3 February," the bench ordered.

The medical bodies had first approached the Kerala High Court. In June, the single judge dismissed the challenge. The High Court noted that in an earlier case, Sabu P. Joseph (Adv). V State of Kerala and Others (2021), the division bench had already issued directions to private hospitals in the State to display rates and fees of the service given to the public as per Section 39 of the Act. This was then upheld by the division bench of the High Court, which also issued certain guidelines, such as the hospitals can't deny life-saving aid to the patients for non-payment of advance or lack of documents and every clinical establishment is required to file an undertaking of compliance with the Act within 30 days and the same has to be audited within 60 days, followed by periodically audits. It clarified that non-compliance will attract regulatory action.

The Special Leave Petition filed against the Kerala High Court judgment questions the constitutional validity of key provisions including Sections 16, 39 and 47 of the Act. Section 39 mandates every clinical establishment to publicly display the fee rate and package rate of all services provided. According to the petitioners, the Act does not define crucial expressions such as “fee rate”, “package rate” or even “type of service”, rendering the requirement vague, unworkable and open to arbitrary enforcement. The petition argues that medical treatment is inherently dynamic and varies from patient to patient, making any obligation to pre-display exhaustive price structures commercially oppressive and structurally impossible.

The medical bodies have further contended that the High Court failed to appreciate evidence placed on record to show that government schemes such as MEDISEP and CGHS themselves contain nearly 2,000 procedures each, demonstrating the impracticality of exhaustive rate display. They have argued that the law imposes disproportionate restrictions on the right to practise any profession under Article 19(1)(g) and exposes hospitals, especially smaller establishments, to harassment through subjective regulatory action.

Another major ground of challenge is Section 47 of the Act, which obligates all clinical establishments to provide life-saving treatment and ensure safe transportation of patients in emergencies. The petitioners have submitted that the provision applies uniformly to all establishments regardless of size, infrastructure or capability, treating a tertiary referral hospital and a single-doctor clinic alike. According to them, the High Court effectively rewrote the statute by reading a tiered framework into the law through executive notifications, instead of testing the provision on constitutional grounds

The petition also raises privacy concerns, objecting to the requirement under the Rules and prescribed forms to disclose granular details of doctors, nurses and other staff, including qualifications and registration numbers, to be uploaded and periodically updated on government systems. The medical bodies argue that such data collection lacks clear statutory backing, violates informational privacy recognised in the Puttaswamy judgment, and undermines competitive confidentiality in the healthcare sector

Case Details: KERALA PRIVATE HOSPITALS ASSOCIATION Vs STATE OF KERALA|SLP(C) No. 36014/2025 Diary No. 70111 / 2025