Health Ministry to remove a clause implying medical colleges can be set up by a commercial enterprise

Health Ministry has approached MCI to remove a clause implying medical colleges can be set up by a commercial enterprise.

Health ministry has recently made a move for removal of an eligibility clause for companies to establish medical colleges even if it is a profit-making enterprise. It clearly implies that the health ministry has now accepted in principle that a company seeking permission to set up a medical college can be a profit-making enterprise. With the withdrawal of the clause with reference to ‘commercialization’, health ministry hopes to set up many new medical colleges under the PPP model.

As exactly reported by Express on the technical facts, the Health Ministry has started the process to remove a clause in eligibility rules which states that permission to companies to set up medical colleges would be withdrawn if there is “commercialisation”.

This decision by the ministry comes in wake of the fact the even after four years after it amended to set up medical colleges under the PPP model; there has been no positive response so far. Not a single company, especially hospital chains has come forward to establish a medical college-fearing the fact that their profit accounts will be subject to scrutiny.

Lot of these big hospital chains are running recognised super-speciality courses; however, they do not have recognition to function a medical college. MCI has now been approached to substitute Sub Clause (6) of the eligibility criteria. The health ministry has written to remove the clause with reference to “commercialisation”.

“This is essentially a contradiction because a company, by definition, is a profit-making venture. So, by putting this clause, we can only hinder transparency, which may be why no company ever came forward in these four years. We have, therefore, asked MCI to substitute the clause with simply ‘companies registered under Company Act 2013’ and also suggested that there should be a provision in the regulations permitting any society or trust that may have set up a medical college to convert itself to a company,” said a Health Ministry official to Express newspaper.

In addition the official implied that currently there are discussions being held between a big hospital chain in South India and Andhra state government to establish a medical college.

This decision by the government can also be viewed in context of an initiative by the government to address the shortage of doctors by having more medical colleges through the PPP mode. At present, there are 222 medical colleges in the private sector and about 200 in the government sector.

Sources in addition implied that this move of amendment in regulations is based on the fact that private sector will not set up a medical college only for philanthropic reasons.

Legal act

As per a 2012 amendment to the Establishment of Medical College Regulations 1999, a medical college can be set up by a state government, a university, an autonomous body promoted by the Central and state government for the purpose of medical education, a society registered under the Societies Registration Act, 1860, a public religious or charitable trust registered under the Trust Act, 1882 or the Wakf Act, 1954 or by a company registered under the Company Act. Still it adds that adds that “permission shall be withdrawn if the colleges resort to commercialisation”.