House panel raps health ministry on CGHS anomalies

NEW DELHI: Armed with a CAG report pointing out irregularities in procurement of medicines and their overpricing under the Central Government Health Scheme (CGHS), the public accounts committee of Parliament has asked the health ministry to formulate specific norms and take action against the guilty.

The PAC, which is evaluating CAG’s observations, summoned health secretary BP Sharma and VK Subburaj, secretary to department of pharmaceutical (DoP), earlier this week to discuss the anomalies pointed out by CAG. The PAC was not satisfied with the responses given by the officials, sources said.

PAC chief KV Thomas expressed concern that ministry was “misleading” the panel on the issue, a source said. 

Asking the ministry to take action, the parliamentary panel has asked for a reply within 10 days as it plans to place a report in Parliament.

Apart from the procurement, supply chain mechanism and overpricing of medicines given under CGHS, the PAC also pulled up officials on availability and quality of drugs.

Under CGHS, government employees and pensioners can avail cashless diagnostics and treatment at a subsidized rates. The scheme, which runs across 25 cities, operates through 273 allopathic dispensaries. Besides, around 562 private hospitals have tie-ups with the Central government for CGHS. A 2010 World Bank report estimates the number of beneficiaries of the scheme at three million. They can also go to a public hospital.

The government has informed the PAC that the pharmaceutical companies have been instructed about the guidelines and action will be taken if norms are not followed.

Sources said the PAC held two meetings on the spurious drugs, pricing mechanism and distribution in the government dispensaries/hospitals covered under the CGHS scheme. “CAG has pointed out that procurement of drugs under the scheme is very dubious as there is no mechanism to ensure that quality drugs are prescribed. Also, the procurement process is so bureaucratic that it takes at least a year for the drugs to be provided to the hospitals. On many occasions, drugs are purchased locally at higher cost which ultimately benefits the private companies,” said a source.

He said, “CAG has pointed out in its report that the doctors are being lured by the pharmaceutical companies through gifts and foreign trips.”

Concerns related to lack of transparency and irregularities in the supply chain in public procurement of drugs by the health ministry have surfaced repeatedly, but this time CAG has found “serious lapses” in quality of medicines supplied to CGHS facilities.

PAC members asked the officials to give the names of drugs which are substandard and that of the companies and said no one should be left with just a warning, sources said.