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LATEST NEWS UPDATES | 500 cr, 120 cr, 100 cr penalty... Govt moves against 33 pvt hospitals -Pritha Chatterjee

500 cr, 120 cr, 100 cr penalty... Govt moves against 33 pvt hospitals -Pritha Chatterjee

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published Published on Oct 24, 2013   modified Modified on Oct 24, 2013
-The Indian Express


New Delhi: At least 33 private hospitals in Delhi have been sent letters for recovery of retrospective penalty - from the time land was allotted to them - for not meeting norms related to free treatment of the economically weaker section and for amassing "unwarranted profits".

The letters have been sent by the Delhi government which hopes to recover more than Rs 1,500 crore in penalty from these hospitals. Officials said the action was in line with court orders.

The penalty amounts have been calculated by 14 chartered accountants. The Fortis Escorts Hospital has been asked to pay around Rs 500 crore while sums ranging from Rs 100-120 crore are to be recovered from Max Devki Devi Hospital in Saket, Dharamshila Cancer Hospital and Saroj Hospital in Rohini. Rs 50-80 crore in penalty has been calculated for Max Balaji Hospital in Patparganj and Maharaja Agrasen Hospital.

In May 2007, the Delhi High Court had ruled that private hospitals not complying with conditions for treatment of EWS patients "must repay to the authorities and the society at large for the unwarranted profits, at the cost of the poor, made by them all these years".

It said money recovered from these hospitals must be used to "create a central corpus/pool which shall be utilized for the welfare, healthcare and treatment of the poorer section of society in government hospitals".

Dr N V Kamat, Director (Health Services), said letters have been sent to hospitals to "intimate" them about the penalty before dispatching final demand letters.

"As per directions of the court, we had appointed some chartered accountants to analyse treatment records of EWS patients and the revenues of private hospitals. The treatment deficit for EWS patients was identified, and that was calculated as a percentage of their total revenue for the year, separately for OPD and admitted patients," he said.

As per court directives, 25 per cent of OPD and 10 per cent of in-patient facilities should be reserved for EWS patients.

Kamat said the letters allow hospitals to submit inputs, if any. The figures will be placed before a special committee appointed by the High Court and final demand letters will be issued thereafter.

Hospitals are crying foul, calling the calculation method "arbitrary".

Dr P K Bhardwaj, who is secretary of the Delhi Voluntary Hospitals Forum and medical superintendent of Saroj Hospital, said: "Calculations by government auditors are from two years after land allotment. But many like Saroj Hospital came up 9-10 years later. The calculation should have been 2007 onward, after the court order came into effect."

"Nowhere is it mandated that private hospitals must go look for poor patients. If the beds are empty, hospitals cannot be penalised, unless they are using them for paid patients. Auditors are only looking if the stipulated bed strength was vacant, without seeing if patients from the EWS category came to us or not during that time," Bhardwaj said, adding that all hospitals have replied to the DHS and were awaiting a response.

A spokesperson for Max Healthcare said: "Max is committed to provide free treatment to EWS patients... we are providing free treatment to all EWS patients visiting our hospitals, wherever applicable. We are in the process of responding to the demand raised by DHS which appears unjustified. We have sought some clarification from DHS on the methodology adopted for calculation of the demand and are awaiting their response."

The Fortis Group declined comment. Sources said it was considering legal recourse.


The Indian Express, 23 October, 2013, http://www.indianexpress.com/news/500-cr-120-cr-100-cr-penalty...-govt-moves-against-33-pvt-hospitals/1186493/0


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