- (1.)Order under Section 26(2) of the Competition Act, 2002.
(2.)SHRI Nandan Kumar (the "Informant") has filed the instant information under section 19(1)(a) of the Competition Act, 2002 (the "Act") against the Association of Healthcare Providers (India) (OP 1), Apollo Hospitals Enterprise Ltd., (OP 2), Yashoda Hospital (OP 3) and all the members of Association of Healthcare Providers (India) (OP 4) alleging, inter alia, the formation of cartel and abuse of dominance by OP 1 in violation of section 3 and 4 of the Act in the matter. Facts of the case, as stated in the information, may be briefly noted:
2.1 OP 1 is a Society registered under the Society Registration Act, 1860 and represents majority of healthcare providers in India. Its membership is open to all the healthcare providers such as hospitals/nursing homes/clinics, diagnostic centres, medical equipment companies, insurance providers etc.

2.2 It is alleged by the Informant that on the basis of the direction/call given by the OP 1, all the private hospitals withdrew cashless medical facility available to Central Government Health Scheme (CGHS) beneficiaries/pensioners across India from a particular date with a stated objective to increase the CGHS rates.

2.3 It is submitted that the CGHS is a Central Government Health Scheme meant for Central Government employees. Central Government employees including retired employees (pensioners) are required to make some contribution to be a CGHS beneficiary. It is stated to be a paid service and part of an overall compensation (popularly known as CTC in private sector). In terms of the CGHS Rule and agreement executed between Private Hospitals and CGHS, the empanelled hospitals are under an obligation to provide cashless medical facility to the CGHS beneficiaries.

2.4 It is stated that OP 2, in the month of April 2014, informed through a placard at its reception about the withdrawal of the cashless medical facility being provided to the beneficiaries of CGHS. The said placard was alleged to have been displayed on behalf of the OP 1 since OP 2 alleged to be one of the members of OP 1.

2.5 The Informant has also highlighted the fact that on enquiry from OP 1, OP 2 & OP 3 through e -mail, OP 1 alleged to have confirmed the withdrawal of cashless medical facility by most of its member hospitals. CGHS local office also alleged to have confirmed over phone the withdrawal of cashless medical facilities available to the beneficiaries of CGHS in Hyderabad and informed about the proposed action initiated by them against these hospitals. The news of withdrawal of cashless medical facilities available to the beneficiaries of CGHS was well covered by media also.

2.6 It is averred that the OP 1 has around 10,000 member hospitals in India and thus any collective action of OP 1 and its members may have adverse impact on the competition in the healthcare segment. It is further submitted by the Informant that any dispute arising between the parties to the said agreement is resolved by the process of arbitration as stipulated in the agreement and such disputes fall under the ambit of the Contract Act.

2.7 It is alleged that due to collusive decision of the Opposite Parties, the private hospitals in Hyderabad withdrew the cashless medical facility available to CGHS beneficiaries. Since most of the good hospitals are empanelled under CGHS for providing cashless medical facility, the Pensioners opt to avail the facility from these hospitals. The withdrawal of cashless medical treatment by these empanelled hospitals is alleged to be a form of cartelization which has adversely affected the medical services available to the Pensioners resulting in denial of medical services.

2.8 The Informant has submitted that the Operation Profit Margin and the Net Profit Margin of OP 2 has improved consistently over the last 6 years, hence the withdrawal of cashless medical facilities available to CGHS beneficiaries/pensioners is untenable on the ground of increase in the cost of services. It is further stated that such hospitals have dual system of reporting of their financial position, that is, they project robust growth on all front when reporting to the investors and a very grim picture to the Government agencies.

(3.)IN additional information, submitted by the Informant, no new issue is raised except the submission that the present case is certainly a contract related issue between CGHS and hospitals but also involves the issue of competition as there is an action by the service providers against a class of consumers. It is stated that the issue involved in the present case is first a competition issue and then a contractual issue.