On Thursday, 19 December, the Association of Healthcare Providers - India (AHPI) released a damning statement on a current healthcare industry crisis underway. Top private hospitals pan-India, including Fortis, Max, Medanta Group, Narayana Group, and BLK recorded non-payment of dues surpassing Rs 600 crores under the Central Government Health Scheme (CGHS) and Ex-servicemen Contributory Health Scheme (ECHS).
AHPI represents 2,500 speciality and 8,000 smaller hospitals across India.
Speaking to FIT, Dr Shikhar Gupta, assistant director of AHPI, said, “These top hospitals have confirmed the lack of payment of upto Rs 600 crores, although it may be more if we consider more hospitals.”
Dr Girdhar J. Gyani, director general of AHPI told ThePrint that they will wait for 15 days from Thursday, 19 December, to withdraw the schemes.
Have Services Been Refused?
Just how bad is the situation? Dr Gupta illustrated with an example, “If a hospital treats a CGHS patient for one month, let’s assume the bill will come up to 1 lakh. Now, according to the official tender, the central government is supposed to pay the hospital within 7 days. But this is not the case. Payments are delayed till 6 months, 1 year, or more, and in that time, the hospital serves more such patients and rakes up bills in the crores.”
CGHS and ECHS patients are served on a subsidised cost, but these schemes were intended to serve vulnerable populations. Suspending cashless payment would hit them hard, as they would have to shell out the payment (still at a discounted rate) and wait to be reimbursed by the government directly.
- Max Hospital has released its official statement to FIT:
“Max Healthcare has been in constant dialogues with government officials regarding its pending dues from CGHS. This delay in payment has created a tough cash flow situation and we are finding it difficult to cope with the deficit, which continues to grow by the day. Despite the challenges faced by us, we continue to treat and support CGHS beneficiaries at our facilities. We are hopeful that our conversations will be met with a positive outcome soon.”
- ‘Hospitals have Begun Laying Off Staff’
According to the AHPI press release, the “non-payment of legitimate dues by the government is taking a toll on the day-to-day functioning of the hospitals. Hospitals are unable to pay salaries to the employees. Many hospitals have begun to cut down the operations by the closing of certain wards/beds.”
Dr Gupta explains some hospitals have started laying off staff but not at a crisis level yet, though he warns this could be the future if the government doesn't respond. Many lakhs of hospital employees stand to lose their jobs. And this of course, will directly hit patient safety and even increase mortality rates.
As for the closing of wards? “Hospitals have been reducing the facilities and services they offer due to a cash crunch.”
Dr Gupta clarifies that the wards referred to in the press release relate to the shutting down of the extra verticals and treatments top private hospitals may offer. “Hospitals are closing wards and beds, as they are shutting these verticals and therefore also laying off certain employees.”
But rest assured, for now, Dr Gupta asserts, “No essential services or tertiary care services have been shut. Nothing that will affect patients is done so far, we don’t want them to suffer”
‘We Have Reached Out to the Government, But No Payment Has Been Made Yet’
“This is not a new issue, this has been happening for a while, but now there is a severe cash crunch,” says Dr Gupta.
The AHPI group met with government representatives and have been assured that this issue will be resolved. “But nothing has happened so far,” he adds.
They plan to build pressure and meet the Health Minister and Finance Minister soon.
This healthcare fiasco is likely to disrupt quality healthcare services for patients if the situation is not resolved soon.