Background:
1.This is a public –private- partnership (PPP) between the BMC and Seven Hills Health group built on 17 acres of public (BMC) land with the prime purpose of providing 20% of its beds to the underprivileged sections of society. A 200 bedded hospital had already been built in that area. But, due to shortage of funds, the BMC entered into a PPP with Seven Hills Health Group. The lease term is for a period of 60 years.
- Seven Hills health Group demolished the existing building and built a large hospital with a potential capacity of 1500 beds with 20% of the beds (i.e. 300 beds) intended to be alloted to BMC patients at rates as those in BMC run hospitals.
3.The remaining 80% of beds would be used by the hospital to generate income to fund the subsidised BMC beds.
4.The hospital was formally inaugurated on July 4th 2010 and services started since then.
5.After inauguration, the hospital claimed that the BMC was expecting more than it had committed to in the initial agreement and refused to treat poor patients as per the agreement.
6.Till date the conflict between the 2 parties continues and the matter is now in the High Court. The High Court has appointed a senior retired judge to arbitrate between the two parties.
7.Despite the conflict not having been resolved, the hospital has been functioning for more than 2 years, treating affording patients.
8.The hospital has now offered to build another building in the same campus for underprivileged patients. As per news reports, they have said that they will hand over this building to the BMC to run on its own and will allow the BMC to use at least some of its diagnostic services at subsidised rates.
9.The BMC has not come to a decision regarding this.
Seven Hills hospital has applied to several Banks to raise loans in addition to the loans it has already taken. The main complaints against the hospital are:
Since the hospital’s inauguration more than 2 years back, it has not been meeting its obligations to the underprivileged, which is the main reason for the PPP between it and the BMC. The hospital complains that the BMC’s expectations are unreasonable and therefore has delayed implementation of its obligations to the poor. This contention is wrong because it has itself admitted: Had we started 200 bedded hospital in the then existing building in the year 2006 with an investment of 60 Crores and reserving 40 beds for BMC patients we could have honored our commitment towards BMC”.
Claiming to have shortage of funds is also wrong because it has admitted that: “We have invested so far 1200 crores”. Therefore, while its principal objective should have been to provide affordable care to the underprivileged, it instead chose to find ways to complete its other business plans. It is therefore morally responsible for depriving thousands of underprivileged people from the surrounding areas of medical facilities, not just from 2010, when it was formally inaugurated, but from 2006 when the initial 200 bedded hospital was ready for use.
Strangely, from July 4th 2010, when it was formally inaugurated, it has been treating rich and affluent patients and even patients from abroad. How did it get the permission to do this?
It was reported in Mumbai Mirror dated 27/7/2010: “Pune-based builder Avinash Bhosale, in trouble over his controversial land deal in Navi Mumbai, seems headed into a fresh row. Less than a week after it was reported that Bhosale made Rs 275 crore by selling half of a plot he was allotted in Navi Mumbai by CIDCO to build a hotel, it has emerged that he owns a stake in Andheri’s ultra-luxury Seven Hills Hospital, which is under attack for violating its terms of agreement with the BMC.
When Mumbai Mirror contacted Bhosale, he admitted to his association with Seven Hills Hospital, but said he has now pulled out of the partnership. BMC’s standing committee chairman Rahul Shewale, however, said that as per the corporation’s records Bhosale is still associated with Seven Hills. A BMC source said Bhosale played an important role in setting up Seven Hills Hospital. “The agreement with the BMC has been signed by Seven Hills Hospital Limited and Soma Enterprise Ltd, which is owned by Avinash Bhosale, ” he said. “We will not let BMC be taken for a ride like CIDCO has been, ” Shewale said”. This has not been challenged by the SevenHills management either in any press statement nor have they sued the newspaper for defamation. One can then presume that it is guilty of such an association.
5.If Seven Hills is having connections with people with dubious reputation why are Nationalized Banks (like Allahabad Bank and Union Bank of India) and even Axis Bank doing business with it? Banks have a responsibility to the public whose money is being loaned to SevenHills.