Ayushman Bharat Empanelment is Privilege Not Right: Allahabad High Court Upholds Surgimed Hospital Removal

A two-month-old battling blood cancer, a ₹9,000 charge for blood that should have been free, and a hospital that lost its government empanelment over the lapse—this is the story behind a recent Allahabad High Court ruling.

A Division Bench of Justice J.J. Munir and Justice Indrajeet Shukla dismissed a writ petition filed by Surgimed Hospital, upholding the State Empanelment Committee's decision to strike off the hospital's empanelment under the Ayushman Bharat-Pradhanmantri Jan Arogya Yojna (AB-PMJAY). Delivered on September 28, 2026, the order firmly establishes that empanelment under government health schemes is a privilege, not a justiciable right.

When Free Blood Came With a Price Tag

Surgimed Hospital was empanelled under the State Health Agency for Comprehensive and Integrated Services (SACHIS) as part of the AB-PMJAY network. The trouble began when the hospital provided two units of blood to a two-month-old child suffering from blood cancer—and charged ₹9,000 for it, contrary to the scheme's mandate that such treatment be free of cost.

The violation did not end there. The attending doctor failed to record the blood transfusion units in the Bed Head Ticket, a mandatory procedure for patients admitted to the Intensive Care Unit (ICU). A show cause notice was issued on June 18, 2026, and after affording due opportunity, the State Empanelment Committee struck off the hospital's empanelment on August 19, 2026.

A Privilege, Not a Justiciable Right

The core legal question was whether de-panelment under the scheme warranted judicial interference. The hospital challenged the impugned order, but the court noted that the doctor who appeared on its behalf before the committee had already admitted to the lapses.

While acknowledging that the impugned order was " not eloquent enough ," the bench held that this did not detract from the substance of facts emerging from the record. Drawing a relatable analogy, the court observed that de-panelment is akin to "a particular patient choosing to opt out of the services of a particular consultant or doctor on account of any act of loss of confidence."

Key Observations

The bench's reasoning turned on a crucial distinction between the right to practice medicine and the privilege of scheme participation:

"Empanelment under the aforesaid scheme is not a justiciable right, but a privilege conferred on particular hospitals, which, of course the State must do in a non-discriminatory manner ."

On the hospital's conduct, the court was unequivocal:

"[P]rima facie material has surfaced against the petitioner-Hospital showing serious shortcomings in the implementation of the scheme on their part and observing necessary protocols while offering treatment under the scheme."

The court further clarified that de-panelment does not, in any way, prevent the hospital or its doctors from carrying on their profession and attending to patients who seek their services.

The Verdict

Finding no ground for interference, the Allahabad High Court dismissed the writ petition with no order as to costs. The ruling reinforces that participation in government health schemes entails strict compliance obligations, and that hospitals failing to observe mandatory protocols—particularly when treating vulnerable patients like infants—must face consequences.