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MP, Chhattisgarh Reject Plan to Privatise District Hospitals

Kashif Kakvi |
Meanwhile, there are reports that the union government is planning to add the subject of health to the concurrent list of the Indian Constitution from the State list.
MP, Chhattisgarh Reject Proposal

Bhopal: The states of Madhya Pradesh and Chhattisgarh have rejected NITI Aayog’s proposal to handover the district hospitals to private players and earn on public-private partnership (PPP) model.

In the proposal, NITI Aayog has suggested that state governments should handover the district hospitals to private players for minimum 60 years and they will turn it into a 350-bed medical college and hospital with their investment. The proposal stated that this move will re-shape the public healthcare system and boost medical education.

On the rights to be conferred to private players, the proposal states, “All exclusive right, license and authority to augment, operate and maintain the District Hospital and provide healthcare services and design, finance, procure, construct, operate and maintain the Medical College (Concession) for a minimum of 60 years as per terms and conditions set in the model agreement.”

The Aayog said that the proposal was based on dire shortage of qualified doctors and the government’s limited resources and capital. "It is practically not possible for the Central/State Government to bridge the gaps in medical education with their limited resources and finances. This necessitates formulating a Public Private Partnership (PPP) model by combining the strengths of public and private sectors. Accordingly, a scheme to link new and/or existing Private Medical Colleges with functional District Hospitals through PPP would augment medical seats and also rationalise the costs of medical education,” the proposal says.

Also read: NITI Aayog Must Not Try to Privatise Public Health

NITI Aayog had asked the states to provide their written comments by January 10, 2020. In return, two states have rejected the proposal. Madhya Pradesh Health Minister Tulsi Silawat said, “Public healthcare system is aimed at improving medical treatment for the poor. The aim of having government-run hospitals is to provide free and affordable medical care to all. If district hospitals are handed over on PPP mode and run for profit, where will the poor go for medical treatment?"

Comments on Niti Ayog Proposal by JSA by Newsclick on Scribd

He further said, “The state government is committed to boost the public healthcare system and we are working on the visionary Right to Health Bill. The Act will guarantee healthcare and also include penalty provisions for failure to deliver guaranteed services.”

Similarly, Chhattisgarh’s Health minister T S Singhdeo has also tweeted against the Aayog’s proposal. Both, Madhya Pradesh and Chhattisgarh are Congress-ruled states and health is a state subject.

In the midst of opposition to the proposal, NITI Aayog has cancelled its consultation meet in New Delhi that was scheduled on January 21, said sources. The Aayog next consultation is now scheduled for February 25.

NITI Aayog proposal is to sell’ public healthcare to private players: JSA

The Madhya Pradesh chapter of Jan Swasthya Abhiyan (JSA) has released a seven page report rebuffing the NITI Aayog’s proposal.

The JSA report says, the proposed scheme can have worse effects on the public heathcare system. “This scheme is drawn up as an avenue for corporate investment and profits in healthcare and this includes investment by global capital. There is also a further implicit aim to re-shape the health sector as a sector that runs along the lines of corporate industry, with profit maximisation rather than health outcomes as its goal.”

“The whole proposal is violation of the spirit of universal healthcare. It also violates the government’s own National Health Policy of 2017, which promises free drugs and diagnostics and free care for all in the public hospitals, and prioritises building up of public hospitals and engagement, and not for profits for fulfilling all secondary and tertiary healthcare needs,” the report further states.

Also read: NMC Act: Death Knell to Indian Healthcare System?

Calling this attempt as a way to include healthcare within the ambit of a corporate monopoly industry, the JSA report added, “It does seem that pressed by financial crisis due to huge additional expenditures on defence and national security on one hand, and the economic slowdown on the other, the government is looking at public hospitals and public health services as a source of revenue rather than as the fulfilment of commitments of a welfare state. And further, in a period of economic slow-down, it is re-creating the public hospital as a site for capital investment for both Indian and foreign capital. In doing so, it is removing the district hospital from the ambit of the primary healthcare approach and making it part of a corporate monopoly industry.”

To back their support on the proposal, the Aayog gave a reference of the best international practices, and similar PPP arrangements that are operative in the states of Gujarat and Karnataka.

However, according to JSA, the basis of selecting the best international practices is without any evidence, several evidences actually point to the failure of such PPPs globally. “Moreover, in India, JSA failed to locate any experience in Karnataka that it could be based on. The closest one – in Raichur was a dismal failure on which internal government assessments are available,” said Amulya Nidhi of Madhya Pradesh JSA chapter.

Letter to CM on Niti Ayog Proposal for PPP by Newsclick on Scribd

This proposal is very similar to the Gujarat Adani Institute of Medical Sciences in Bhuj, which is a failure. According to a Economic Times report, “Over 1,000 children have died in last five years in the hospital.”

The model included heavy investments from the government, in addition to the Adanis bringing in a Rs 100 crore investment, but after 10 years, it still has a cumulative deficit – which the government may or may not be covering. This is after it has been charging fees as high as Rs 3 lakh per medical student and Rs 8 lakh for an NRI student.

Moreover, for Adani which has a Rs. 24,000 crore investment in that district of Gujarat, this was well within its CSR obligations. Even when within Gujarat the scheme was sought to be expanded to six districts (Tapi, Dahod, Panchamahals, Banaskantha, Bharuch and Amreli), there have been no takers for this. The scheme is, therefore, likely to be attractive only to the largest corporate powers and that, too, with heavy investment from government. It could also be attractive for foreign investors.

“The PPP mode operation of district hospitals has been a failure in Madhya Pradesh,” said Amulya, adding, “In 2015, the state government proposed to handover 27 district hospitals to a Gujarat-based private company. And in the first phase, the BJP-ruled state government handed over Alirajpur district hospital, but, it collapsed in a year.”

“In fact, the NITI Aayog report has skipped mentioning it as a success story," he said terming the Aayog’s proposal as ‘selling’ of public healthcare to private players. JSA has also written to Chief Minister Kamal Nath and Health Minister Tulsi Silawat regarding flaws in the newly proposed ‘PPP’ model.

Transfer Health to concurrent list: 15th Finance Commission

Meanwhile, unhappy with the rejection, the Union government is planning to transfer the subject of health to the concurrent list of the Indian Constitution from the State list. “The subject of ‘health’ must be transferred to the Concurrent List of the Indian Constitution from the State List, the high level group (HLG) formed for the health sector by the 15th Finance Commission has said,” said a DownToEarth report.

Also read: CGHS Struggles With Poor Infrastructure and Shortage of Doctors

Since issues like medical education and family planning fall under the concurrent list, health also should, the panel said in a report submitted recently to the Finance Commission.

The HLG is chaired by All India Institute of Medical Sciences Director Randeep Guleria and consists of Devi Shetty (Narayana Health City), Deelip Govind Mhaisekar (Maharashtra University of Health Sciences), Naresh Trehan (Medanta Medicity), Bhabatosh Biswas (R G Kar Medical College) and K Srinath Reddy (Public Health Foundation of India).

The HLG has also put its stamp on the Public Private Partnership (PPP) model of the NITI Aayog. “Incentivise the private sector to open 3,000-5,000 small hospitals in India’s Tier II and III cities in order to overcome the paucity of hospitals in the country,” it has recommended to the Commission.

“This is very strange,” T Sundararaman, former Executive Director of National Health Systems Resource Centre, was quoted in the DownToEarth report.

“Some of the states have been doing really well with or without the Centre’s support. Some have refused to accept central schemes according to their requirement. While we have been pitching for decentralisation of power and fund allocation, this is exactly a step in opposite direction,” he further said.

“We find there is a conflict of interest in the panel as two of the members are directly linked with the private sector. While we strongly oppose the very proposition, we are not surprised at this recommendation because of the composition of the panel,” he added.

One of the members of the committee, K Srinath Reddy, in his recently released book, Make Health in India, described the PPP model as a ‘partnership for profit’ model.

Letter to Healt Minister on Niti Ayog Proposal for PPP by Newsclick on Scribd

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