Saturday, August 23, 2014

Extending benefits to hospitals only with NABH accreditation wasn’t abuse of dominance by Director General of Health Services

Where opposite party-DGHS was not directly engaged in any economic and commercial activities and different rates of empanelment fees prescribed by it for hospitals under ‘National Accreditation Board for Hospitals and Healthcare Providers’ (NABH) were not anti-competitive, there was no abuse of dominant position by DGHS.


a)The informant alleged that opposite party-The Director General of Health Services (DGHS) was abusing its dominance for empanelment of private hospitals for purpose of healthcare and medical services to Central Government Health Scheme (CGHS) beneficiaries.

b)Further, it was alleged that DGHS had colluded with other opposite parties to give benefit to a selected hospitals having NABH accreditation and reimburse them with payments at higher rates compared to other hospitals without NABH accreditation

The Competition Commission of India held as under:

1)Since the DGHS’s role was limited to control and regulate heath care system in country and was not directly engaged in any economic and commercial activities, it could not be covered in definition of enterprise.

2)The different rates prescribed by DGHS for NABH accredited hospitals could not be considered as anti-competitive in any manner; rather it would act as an incentive to non-accredited hospitals to secure such accreditation and provide quality health care services, which would ultimately benefit patients.

3)Since informant had not submitted any cogent evidence stating existence of any agreement in any manner between opposite parties, the provisions of section 3 of the Competition Act, 2002 could not be invoked. – DR. BISWANATH PRASAD SINGH V. DIRECTOR GENERAL OF HEALTH SERVICES [2014] 47 373 (CCI)