KATHMANDU, Dec 31: Bir Hospital (National Academy of Medical Sciences) is in an extreme financial crisis. The hospital finds itself in a deep financial crisis right from the beginning of the current fiscal year 2023/24. Hospital services have been affected due to the lack of funds. On the one hand, the hospital’s capacity needs to be expanded, while on the other hand, the budget is low. This crisis has put the institution in a state of disrepair, significantly affecting patient care and medical services.
Despite the increase in the number of beds and services, there is no budget allocation in the same ratio, as compared to the previous budget. Bir Hospital is in a financial crisis, said Tham Narayan Sharma, head of the accounting department. According to him, despite an increase in services and bed capacity, there hasn't been a proportional budget allocation. This imbalance has plunged the hospital into a financial crisis, making it challenging to cover essential expenses such as patient meals, equipment maintenance, cleaning staff salaries, and even vital supplies like oxygen. As a result, the hospital faces difficulties in procuring necessary equipment and treatment materials across various departments, including reagents, operation theaters, laboratories, and X-ray facilities.
According to Sharma, despite doubling the hospital’s capacity, the Ministry of Health and Population (MoHP) allocated a lower budget than before, creating complications. Previously, when the hospital had 460 beds, the budget provided was higher compared to the current allocation for the expanded 960-bed facility. Moreover, the recent expansion of VIP and VVIP treatment rooms naturally increased the expenses.
The financial burden increased further after the hospital announced 700 beds free of charge. With a daily influx of 2500 to 3000 patients seeking services at Bir Hospital, the strain on resources has escalated. Sharma said that in the fiscal year 2021/22, a budget of Rs 2 billion was allocated for Bir Hospital.
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In 2022/23, only Rs 1.43 billion was allocated whereas Rs 730 million has been allocated in the current fiscal year 2023/24, which is said to be insufficient to meet the expanded services, facilities and staff costs of the hospital. Last year, more than Rs 606 million was spent on procurement of medical supplies alone. “How is it possible to cover all the expenses with a total budget of Rs 730 million this year?" said Sharma, head of accounting department.
Sharma said that following media coverage highlighting the necessity to provide meals for patients, there was unofficial information indicating that the Ministry of Finance had released Rs 45 million on Thursday. However, this amount was deemed largely insufficient to address the pressing financial challenges the hospital faces.
Sharma said, “The amount proposed by the ministry falls significantly short of the hospital's actual requirements, making it impractical to accept.” He said that even within the allocated budget, there's a zero allocation for crucial needs like food, oxygen, and maintenance, exacerbating the crisis. Regarding financial dealings, Sharma said that lenders demanding repayment have been informed of delayed payments, citing imminent disbursements. However, payments have been halted, promising partial disbursements of two-three hundred thousand from the internal budget, with the remainder to follow later. This financial strain has affected the timely payment of cleaning, security, and temporary staff salaries. Furthermore, Sharma said that night-shift doctors and health workers have been deprived of food and additional allowances, with some not receiving their salaries since November.
According to Sharma, there is a debt of Rs 45 million for food grains, more than Rs 18.2 million for oxygen and millions of rupees to be paid for the purchase of other materials. According to the hospital, the salary cost of permanent employees is Rs 160 million per month, while Rs 77.6 million needs to be allocated for the salary of temporary employees. Likewise, 80 percent of the income from the hospital source is spent on monthly salaries.
While appropriating the budget, the hospital sent a ceiling of Rs 1.56 billion to the Ministry of Finance through the National Planning Commission and the Ministry of Health, but only Rs 730 million was received. After the budget allocated was less, the hospital initially demanded Rs 1.2 billion, but that demand was not met, either. The hospital again demanded a budget of Rs 920 million. Sharma complained that none of those demands were heard. "Since July, we have asked for the budget eight times, we have even submitted a letter to the Prime Minister, but we have not been heard," he said.
According to the ceiling given by MoHP, the hospital is complaining that the budget that should come from the Ministry of Finance has been cut off by MoHP itself. According to Sharma, there is also a dispute between the Ministry of Finance and the Ministry of Health and Population. “The finance ministry has asked the health ministry to provide a budget to the hospital but the health ministry has maintained that the finance ministry should give it," he said. Sharma said that the employees of the hospital are preparing to go on a strike as they are not getting their salaries after the budget is not released on time. Spokesperson for the Ministry of Health Dr Prakash Budhathoki suggested that it would be appropriate to cut on expenditures and operate the hospital.
