Telangana hospital suppliers’ association faces financial crisis with unpaid bills in crores, threatens to stop supply

In a poignant representation to the media, the Association expressed their plight, stating, “Since last year, we have not received any payment from the ESI Directorate Office (DIMS) and the bills have been held for the last 12 months. We met the Director General, ESIC, New Delhi, on his visit to ESI Nacharam Hospital in Hyderabad, and we made a representation regarding the payment issue. However, we were informed that the budget had already been released to the Telangana government.”

“Thus, we have decided to stop supply if the Telangana government does not pay us. Unfortunately, poor patients are the sufferers,” the Association said.

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A problem for suppliers and patients

Girish Bhat, the Managing Director of Medihauxe Pharma, reveals to South First the critical financial strain his company is under. “I have been a permanent supplier for surgical equipment and medicines for most of the branches of ESI Hospitals in Hyderabad. The situation has become bad; my company has pending amounts of ₹2 crore. On 24 January, the ESI placed another ₹3 crore order. I have no finances left to take loans and supply the orders to the hospital.”

Empathising with poor patients, who he believes are the sufferers, Bhat says, “The patients are the sufferers because my drugs are lifesaving. ESI has been redirecting patients to my company, saying that we are the ones supplying the drugs and surgicals equipment, and these patients are requesting us to provide what they need. This is pathetic as these patients are from poor families and they are being made responsible to get an operation done.”

Conveying the gravity of the situation to South First is S Ramchand, President of Twin Cities Hospital Suppliers’ Association. He says, “The situation on the ground is different when compared to the previous years of governance. There are over 150 suppliers in our Association and funds are pending for each one of them. There are 700 types of medicines, 200 types of surgical equipment, and 150 types of other equipment supplied to all ESI branches.”

He adds, “We have followed up with the hospitals and government officers, however, there has been no response. We firmly believe that stopping the supply is our only option. We, the suppliers, have already paid all taxes and duties like SGST (State Goods and Services Tax) and CGST (Central Goods and Services Tax) to the government on time.”

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Pending payments from other hospitals

Elaborating on the challenges, the Association said at the press meet, “Our suppliers quote competitive rates to qualify in the tenders. However, due to delay in payments, we are unable to supply drugs and surgical equipment on time. This will be very inconvenient for a patient’s treatment.”

“There are also payments due from Osmania General Hospital, Gandhi Hospital, Niloufer Hospital, and Telangana State Medical Services and Infrastructure Development Corporation (TSMSIDC),” it added.

“We could have made a representation to the Labour Minister but there is no minister in Telangana right now, and we have no communication as to whom to contact. There is also a GO from Labour, Employment Training, and Factories Department — dated 16 January, 2024 — that has issued a budget release order to the Director of Insurance Medical Services (DIMS) for an amount of ₹65.42 crore as additional funds in relaxation of treasury control, yet we have not received a penny,” the Associated said.