A patient walks in for a consultation, the doctor prescribes a course of medicine, and reception dispenses it from the in-house pharmacy before the patient leaves. That is one visit, but it is not one GST treatment. The consultation is very likely exempt. The medicine is very likely taxable. Both lines belong on the same bill, and getting that split wrong in either direction, charging GST on an exempt consultation or forgetting it on a taxable pharmacy item, is the kind of error a GST audit is specifically built to catch.
This article lays out that boundary as it is actually published by CBIC, with the source cited for each claim, and then looks at what it means for a clinic's invoice once a single visit crosses it. One thing this article is not: tax advice for your specific clinic. GST treatment depends on facts and circumstances, notifications get amended, and rulings interpreting them evolve. Treat everything below as the general position as currently published, and confirm anything that affects your billing setup with your own chartered accountant before you rely on it.
The starting point is Notification No. 12/2017-Central Tax (Rate), dated 28 June 2017. It exempts "health care services" supplied by a clinical establishment, an authorised medical practitioner, or para-medics, classified under SAC (Services Accounting Code) 9993. "Health care services" is defined there as diagnosis, treatment, or care for illness, injury, deformity, abnormality, or pregnancy in any recognised system of medicine in India, and it also covers transporting a patient to or from a clinical establishment by ambulance.
Two things follow from that wording. First, the exemption attaches to the service, not to the fact that a doctor or a clinic is involved in something, so a clinic can still owe GST on things it sells or does that fall outside that definition. Second, the exemption is for services, which is exactly why goods, medicines, consumables, sold alongside a service sit on a different footing, covered below.
The exemption in Notification No. 12/2017-Central Tax (Rate) is deliberately narrow to "health care services." A clinic's day-to-day billing regularly crosses outside that definition in three specific, published ways.
A summary table for orientation only. Every row above has real exceptions and facts-and-circumstances calls; use this to see the shape of the boundary, not as a final answer for a specific bill.
| Line item | Generally | Why |
|---|---|---|
| Doctor consultation fee | Exempt | Health care service, SAC 9993, Notification No. 12/2017-CT(Rate) |
| Diagnostic test ordered as part of treatment | Exempt | Part of the same health care service as the consultation |
| Medicine dispensed to an admitted inpatient | Generally exempt | Treated as part of one composite health care supply |
| Medicine dispensed to an outpatient / walk-in pharmacy sale | Taxable | Treated as a separate supply of goods, not a health care service |
| Reconstructive surgery (congenital defect, injury, trauma) | Exempt | Circular No. 32/06/2018-GST carve-back for therapeutic intent |
| Cosmetic/aesthetic procedure (appearance-driven) | Taxable | Expressly excluded by Notification No. 12/2017-CT(Rate) |
| Hair transplant | Taxable | Expressly excluded by Notification No. 12/2017-CT(Rate) |
| Non-ICU hospital room, ₹5,000/day or below | Exempt | Threshold not crossed |
| Non-ICU hospital room, above ₹5,000/day | Taxable at 5%, no ITC | Entry 31A, Notification No. 03/2022-CT(Rate), effective 18 Jul 2022 |
| ICU / CCU / ICCU / NICU room, any daily rate | Exempt | Explicitly carved out of Entry 31A |
None of the tax publishers who cover this boundary well tend to close the loop on what happens next: a clinic still has to put an exempt line and a taxable line on one patient's one bill, correctly, every time, without turning billing into a manual judgment call at the front desk. That is a billing-system problem, not just a tax-law one, and it is where this differs from the fiscal-year numbering piece and the GST 2.0 rate-change piece already on this blog: those cover how the document number holds together and what rate applies once an item is taxable. This is the step before either of those questions, which line is taxable at all.
CuraVerto's billing engine handles this at the line-item level, not the invoice level. Every catalog service and every invoice line carries its own GST-applicable flag and, where applicable, its own GST rate, configured once by the clinic. A single invoice can therefore total an exempt consultation line at 0% alongside a taxable pharmacy or procedure line at its configured rate, with CGST and SGST computed only on the taxable lines, and the whole document still carries one sequential, fiscal-year-correct document number rather than needing to be split into two bills to keep the math straight. What CuraVerto does not do is decide, on its own, whether a given service should be exempt or taxable, or whether a specific procedure counts as reconstructive: that configuration, and the underlying tax determination behind it, is the clinic's and its CA's call. CuraVerto's job is to apply that determination correctly and consistently once it is set, on every bill, every time.
This checklist holds regardless of which software your clinic runs. It is meant to be genuinely useful even if you never look at CuraVerto again after reading it.
No, not as a rule. Notification No. 12/2017-Central Tax (Rate), dated 28 June 2017, exempts health care services provided by a clinical establishment, an authorised medical practitioner, or para-medics (SAC 9993) from GST, and a doctor's consultation fee for diagnosis, treatment, or care falls squarely inside that definition. This is the general rule, not a determination for your specific practice structure, so confirm with your chartered accountant if your consultation is billed through an arrangement that might sit outside it, for example a corporate or franchise billing structure.
For outpatients, generally yes. Guidance and rulings interpreting the health care services exemption draw a line between medicines given as part of inpatient treatment, which are typically treated as part of one exempt composite supply, and medicines sold to an outpatient, which are typically treated as a separate, taxable supply of goods because the patient could in principle buy them from any pharmacy. Since CuraVerto is built for OPD-first clinics, this second case is the common one: an in-house pharmacy sale to a walk-in or outpatient is ordinarily taxable at whatever GST rate applies to that medicine's HSN code. Confirm the treatment for your specific dispensing model with your CA.
Usually, yes. The same Notification No. 12/2017-Central Tax (Rate) that exempts health care services expressly carves out hair transplant and cosmetic or plastic surgery, and CBIC Circular No. 32/06/2018-GST (12 February 2018) clarifies that this carve-out does not apply when the procedure is undertaken to restore or reconstruct anatomy or bodily function affected by a congenital defect, developmental abnormality, injury, or trauma. In practice: reconstructive work generally stays exempt, and appearance-driven aesthetic work generally does not. Where a procedure could plausibly be argued either way, that determination belongs to your CA, not to this article.
Since 18 July 2022, a hospital room (other than ICU, CCU, ICCU, or NICU) billed at more than ₹5,000 per day attracts 5% GST without input tax credit, under Entry 31A inserted by Notification No. 03/2022-Central Tax (Rate). This is an inpatient, hospital-bed boundary. It will not come up for most OPD clinics, which is the majority of CuraVerto's customer base, but it matters if your practice also runs admitted beds.
Yes. Nothing in GST law requires a clinic to split an exempt consultation and a taxable pharmacy item onto separate bills; the requirement is that each line is treated, and taxed, correctly for what it actually is. CuraVerto's billing engine supports this at the line-item level: every service and catalog item carries its own GST-applicable flag and rate, so a single invoice can total an exempt consultation line at 0% GST and a taxable medicine line at its own configured rate, with CGST/SGST computed only on the taxable lines, while the document still gets one fiscal-year-correct number. CuraVerto applies whatever treatment your catalog is configured with; it does not decide for you which of your services should be exempt or taxable, that determination is still yours and your CA's to make.
Set the GST treatment once per service or catalog item, and every invoice, exempt and taxable lines together, gets billed and numbered correctly from Essential onward. Flat annual pricing, exclusive of GST, no per-doctor fee.