Andhra Pradesh Government To Raise Loan To Clear Private Hospital Dues, Provided Latter Pay 8% Interest
Of this, it is due around ₹1,000 crore to government hospitals, while it has to pay private network hospitals nearly ₹2,000 crore.
Kurnool: In a significant development, private hospitals in Andhra Pradesh have agreed in principle to pay 8 per cent interest on the loan that the state government will raise to clear pending dues of private hospitals that had treated patients under the Arogyasri scheme of the state government.
AP government has not yet paid nearly ₹3,000 crore to hospitals for treating patients under Arogyasri. Of this, it is due around ₹1,000 crore to government hospitals, while it has to pay private network hospitals nearly ₹2,000 crore.
Amid mounting financial stress, private hospital associations Asha (AP Super Speciality Hospitals Association) and Apna (AP Nursing Homes Association) issued a notice, warning of suspending the Arogyasri services if the state government does not clear their bills promptly.
Following this, principal secretary (Health) Saurabh Gaur convened a high-level meeting with representatives of both the associations. This has led to a proposal under which the government will initially raise ₹1,000 crore through the State Finance Corporation to pay part of its dues to the private hospitals. However, the government has asked hospitals to bear the 8 per cent interest burden on this loan.
According to sources, nearly 90 per cent of private hospitals have agreed to the proposal, preferring immediate liquidity over prolonged delays. “We have no other option. We are facing a severe liquidity crunch. It is becoming increasingly difficult to run operations without funds,” said Asha president Dr K. Vijay Kumar, “We had earlier approached the court seeking clearance of dues. This agreement comes after the court’s intervention,” he pointed out.
Dr. Vijay Kumar clarified that private hospitals have objected to an earlier clause of the state government that required them to act as guarantors to the loan issued by the State Finance Corporation. “We rejected this condition. The government is now working on a revised agreement,” the Asha president stated.
Officials said login credentials have already been issued to eligible private hospitals on April 20 and April 21. Upon accessing the portal, hospitals are required to accept the terms and conditions of payments. Once accepted, payments will be processed after deducting 10 per cent TDS and an additional 8 per cent interest payment from the billed amount.
Hospitals unwilling to accept these terms have the option to reject the agreement online. But their payments may be delayed indefinitely.
Dr. Rahul, Apna representative from Kurnool, said, “Given the situation, we have no choice but to agree. If payments are delayed by nine months to a year, the financial burden would be similar. It is better to accept an 8 per cent deduction now and get immediate funds.”
The revised agreement is expected to be signed by representatives of both the associations within a day or two. Payments are likely to be credited to the hospital accounts within three days thereafter.
