Moi Teaching and Referral Hospital has long outstanding debts of Sh457.8 million relating to unsettled medical bills, medical service providers, individual client debtors and corporate clients.
Parliament wants Moi Teaching and Referral Hospital (MTRH) to review its debts that were secured with national identity cards (IDs), commitment letters and title deeds in order to restructure or seek approval for write-off.
The Public Investments Committee (PIC) says the hospital has long outstanding debts of Sh457.8 million relating to unsettled medical bills, medical service providers, individual client debtors and corporate clients whose recoverability is doubtful.
“Some of the debts were secured with very weak collateral, hence the possibility of their collectability appears remote,” PIC chairman Adan Keynan said in a report to Parliament.
The report shows that the debts were secured with ID cards, commitment letters and title deeds out of which an amount of Sh361,024,834 relates to 2002 and 2010.
“Since these debts were secured with very weak collateral, the possibility of their collectability appears remote and the management has not indicated the measures being taken to have the amounts collected,” Edward Ouko, auditor-general said in the hospital’s audited books of accounts for the year to June 2015.
MTRH chief executive Wilson Aruasa told PIC that the hospital no longer accepts IDs as collateral and insists on alternative acceptable ones such as logbooks and title deeds.
“The Constitution (Article 43) guarantees access to healthcare to all its citizens whether or not they have funds.
“The socio-economic status of the residents within the hospital’s catchment area is largely comprised of people from a humble background.
“The consequence of this is the increase in number of indigents that have no valuable collaterals,” he said in a brief to the committee.
Dr Aruasa said in order to decongest the wards and avoid hospital-acquired infections, such patients were discharged with available collateral mostly IDs.
“The hospital no longer accepts identification cards as collaterals and insists on alternative acceptable ones such as logbooks and title deeds. Those who cannot pay are waived instead,” he said.
He petitioned Parliament to ensure that the government meets the hospitalisation cost on behalf of poor patients through settlement of the amount secured by ID cards and that which has been waived.
He said the hospital management from time to time, offers incentives to security holders of a discounted settlement of debts.
“The committee recommends that the CEO and the finance manager should undertake an analysis of all debts and reviews the current policies governing management of debts to establish areas of weaknesses, recommend a prudent debt management system, debt restructuring and to seek Board approval to write-off unrecoverable debts,” PIC said.
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