Wednesday, September 28, 2022

No Clarity on Charity

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Despite court rulings, free health care for poor patients in private hospitals remains contentious. Only a law enacted by parliament can make free treatment mandatory

By Venkatasubramanian

Till 1980s, only a few private hospitals and charitable institutions funded by big business families or missionaries, apart from government hospitals, catered to the poor. A policy shift, however, enabled the government to offer subsidies to the private sector by way of land (leased or otherwise) at nominal rates, granting medical care the status of industry in order to guarantee cheap credit, reduction of import duties on equipment, exemption from paying property taxes, water and electricity charges etc. As a result, the private health industry experienced phenomenal growth, with successive governments grappling with the issue of effective regulation of private hospitals in order to ensure meaningful right to health for its citizens.

To live with dignity would take within its ambit legitimate expectations of the citizens of the country of being provided with good environment and health care, so noted Justice Swatanter Kumar, while writing the judgment of the Delhi High Court in Social Jurist vs Government of NCT of Delhi on March 22, 2007.
The judgment in this case was a defining moment in the struggle of the economically weaker sections [EWS] of society for free treatment in the best private hospitals in the country. The argument was that these hospitals have availed of various concessions and privileges from the state, and therefore, are duty-bound to provide free treatment to those who cannot afford it.

The high court found that the lease deed and terms of the letter of allotment of land to hospitals imposed a contractual, statutory and public obligation on them. The court noted that these hospitals had accepted the condition in regard to the free patient treatment of indigent persons and accepted the same without any reservations.
The hospitals contended before the high court that they are super-speciality hospitals and are not expected to treat patients free, particularly the indoor patients as the cost which they would incur may not be financially viable and may affect the deposits and assets of the hospital, and the company or trust running it.

In response to this contention, the high court held that this concept of profiteering is foreign to social policies. The government and authorities allotted them land in the heart of the town at such rates to achieve the social goal of providing best possible health facilities to the residents of Delhi. This condition, the high court said, is the spirit behind the statutory rules, policies and letter of allotment.
To take one example, the high court said, the Escorts Hospital has been making a pre-tax profit of `27 crore every year and certainly has come up in the city as one of the significant super speciality hospital. If it had complied with their obligations in a regular phased manner which they had admittedly not, at best their profits might have reduced marginally.
While government hospitals offer affordable healthcare, even in the premier hospital of the country, patients have to spend days on the footpath (right) in the absence of proper infrastructure

In contrast, the high court had pointed to the example of a hospital like VIMHANS, which is a super speciality hospital relating to neurological problems where the condition for free treatment required them to provide free patient treatment to 70 percent of the patients as per the terms of the land allotment, and they attempted their best to adhere to the condition despite losses.

The high court was clear that both the Escorts Hospital and the Dharamshila Hospital which contested the claim that they had an obligation to provide free treatment, must be compelled to adhere to the conditions imposed, failing which the law must take its own course including closure of these hospitals. “They cannot thrive at public cost and State expense without fulfilling the minimum conditions imposed upon them to achieve a greater social goal and to look after the interest of the public at large,” the high court held.
It thus held that the condition of free patient treatment to the indigent strata of the society shall be read and construed as 25 percent for OPD and 10 percent for IPD. The court made it clear that this percentage of patients will not be liable to pay any expenses in the hospital.

In 2001, the DDA had sought a report from 14 hospitals regarding the fulfilment of their obligations. Only five of them responded to the notice. According to the Public Acc-ounts Committee report of the Lok Sabha in 2005, no action was initiated against the defaulters; nor was any action taken to verify the correctness of the report furnished by the five institutions.

The Qureshi committee had concluded that most of the charitable hospitals were no more charitable, and that their managements had converted them to moneymaking mach-ines. The petition by Social Jurist was filed in Delhi High Court in 2002, citing the Qureshi committee report.

The Delhi High Court judgment was appealed against by some private hospitals in the Sup-reme Court. The private hospitals proposed to provide free treatment to poor patients with a cap of up to `50,000. The Delhi Government rejected this proposal. On September 1, 2011, the Supreme Court bench comprising justices RV Raveendran and AK Patnaik dismissed appeals in Dharamshila Hospital and Res-earch Centre vs Social Jurist and others, and held that 25 percent OPD and 10 per cent IPD patients have to be given treatment free of cost. The apex court reiterated the high court’s judgment but added that it would not come in the way of the concerned hospital making its own arrangements for meeting the treatment/medicines cost, either by meeting the cost from its funds or resources, or by way of sponsorships or endowments or donations.

One would expect that the Supreme Court’s September 1, 2011, order must have finally resolved the controversy. However, activists and authorities are still struggling to ensure compliance of the private hospitals with the order. In some instances, even the high court and the Supreme Court have not been as serious as they should be in demanding and ensuring compliance.

On March 13, 2013, the Delhi High Court dismissed a petition by Social Jurist seeking to initiate contempt proceedings against three hospitals, namely, Moolchand Khairati Lal Trust Hospital, St Stephen’s Hospital and Rajiv Gandhi Cancer Institute and Research Centre, alleging that they disobeyed the high court’s March 22, 2007 judgment. It was alleged by the petitioner in this case that on November 7, 2008, the Delhi government had named 37 private hospitals which were obliged to provide free treatment to the poor patients and these three hospitals were included in that list; yet these three were not providing free tests and treatment to the poor patients. The high court, however, dismissed the petition on the ground that the three hospitals were not parties to the petition filed by the Social Jurist which was dealt with in the March 22, 2007 judgment.

But there are several cases where subsidised land was given to hospitals. Moolchand hospital in Delhi was given nine acres of prime land at Lajpat Nagar in South Delhi in 1951. In 1957, the Lahore Hospital Society was allotted five acres of land on Pusa Road, Delhi, to construct a charitable hospital. In Delhi alone, between 1951 and 1976, land was allotted to five different charitable hospitals on the condition that considerable proportion of treatment would be given to poor patients. In fact, the Land and Development Office of Delhi had imposed conditions on some hospitals that required them to set aside 70 per cent beds for free treatment.
Apollo Hospital was allotted 15 acres of pri-me land in South Delhi in 1988, for a token rent of `1 per annum, in return for 33 per cent of free beds. The Delhi high court is currently seized of a petition by the widow of an EWS patient who was denied timely treatment by the hospital, but instead was charged a huge fee. Seema Chauhan’s husband was admitted to Apollo Hospital on April 27, 2013. The Delhi government told the high court that on that date, 28 beds in ICU of Apollo hospital were occupied by EWS category instead of quota of 12 beds for government of NCT of Delhi. Seema, however, contested this claim and has sought the refund of fee paid by her to the hospital. The case is still pending.

On April 28, 2014, the Delhi High Court thr-ough another judgment, disappointed those who had high expectations of the applicability of the March 22, 2007 high court judgment to the entire country, especially after the Supreme Court dismissed appeals against it in 2011. The high court held that the main judgment in 2007 did not decide, as a matter of law, that all allotments of lands made on concessional basis, regardless of whether the conditions in lease/allotment contained requirements of free treatment to economically weaker sections, were to be subjected to the same treatment and directions. This would mean that for applying the March 22, 2007 judgment to any hospital, it has to be identical or similar to the 20 hospitals which were parties to that case.

Further, the high court held that it was not enough if the hospitals were beneficiaries of allotment or leases at concessional rates; both the allotment letter and the lease deed must contain an express requirement to provide free medical facilities. In the absence of such requi-rement, neither the central government nor the Delhi government had the power to issue directions in that regard, the high court held. The high court also held that the state can issue such directions only with legislative backing. Thus four hospitals, namely, Mool Chand Kha-irati Ram Trust, St Stephen’s Hospital, Sitaram Bhartia Institute of Science and Research and Foundation for Applied Research in Cancer, who were the petitioners in the case, were exempted from the obligation to provide free medical treatment.

On December 5, 2014, another bench of the Supreme Court dismissed an appeal filed by Jharkhand Human Rights Conference against a decision of the Jharkhand High Court dismissing its public interest litigation seeking directions to provide free treatment of the poor in private hospitals allotted land free or at concessional rates.
Although the Jharkhand High Court’s dismissal of the PIL conflicts with the Supreme Court’s September 1, 2011 order, the Supreme Court bench comprising justices HL Dattu and AK Sikri said that since these were private hospitals, they were under no obligation to provide such services to the poor. Justice Sikri, as reported in Livemint, added that if these hospitals were companies, under the new Compa-nies Act of 2013, the court could direct them to spend funds for corporate social responsibility on economically weaker sections of the society.

According to a study conducted in Mumbai in 2013, there were about 80 state-aided charitable hospitals registered with the Charity Com-mission in Mumbai. Data on bed strength for about 60 of them showed they constituted more than 8,000 beds. The largest 25 among these hospitals accounted for about 6,400 beds. Overall, it meant that about 800 beds were available for the poor for free and another 800 beds at subsidised rates.

Around 14 state-aided charitable hospitals, including Lilavati, Breach Candy, Jaslok, Bombay, Hiranandani and Saifee Hospitals, had appealed to the Charity Commissioner stating that they were currently overspending in order to treat the poor and were incurring losses. The Charity Commissioner allowed four such hospitals—Jaslok, Hiranandani, Breach Candy and Lilavati—to stop treating poor patients temporarily. Investigations that followed the exemption indicated that Jaslok, Breach Candy and Bombay Hospital used only 4 to 4.5 percent of the 10 percent beds they had committed to use to treat the poor. A survey in 2007 showed that prominent notices about such schemes were often absent in hospitals and poor people remained unaware.

Provisions such as free treatment can only be in addition to and not a substitute for a strong public health system, and that the non-compliance of the hospitals even to the legally bound provisions highlights the urgent need for a more robust regulatory mechanism, created through a law enacted by parliament.

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