Kottayam:A health insurance fund meant to provide free treatment to the poor became a source of money for salaries and unauthorised appointments at Kottayam Medical College Hospital, with crores diverted even as patients went without insurance benefits for nearly three years. The hospital is also alleged to be the only medical college hospital in the state where beneficiaries still remain outside the scheme.

Inspections conducted by the Principal Accountant General (Audit-I) in 2024, 2025 and 2026, along with special inspections by the external audit wing, have unearthed a string of irregularities in the utilisation of the fund.

Funds diverted, insurance scheme derailed
Of the more than 1,000 appointments made through the Hospital Development Society (HDS) over the past 10 years, 720 were found to be unauthorised. As much as ₹93.48 crore was diverted to pay salaries.

Patients have been without health insurance benefits since September 2023. The inspections also found them struggling to access medicines and surgical equipment due to a shortage of funds.

Questionable appointments
The insurance fund was used to appoint 98 data entry operators, 280 staff nurses and 181 paid trainees. It is also alleged that most of these appointments went to CPM supporters and workers. The hospital receives an average of 4,575 health insurance applications a month, while the average daily workload of its 98 data entry operators was just 1.57 entries.

The inspections also found that ₹4,85,72,247 from the insurance fund had been spent on the salaries of junior doctors, even though there was no provision for appointing doctors on a daily-wage basis at the medical college. The expenditure should instead have been met from the HDS fund.

Over 40% of fund diverted for salaries
More than 40% of the insurance fund was diverted to pay the salaries of HDS employees without prior approval. This led to insurance-related dues piling up and created a financial crisis in running the scheme.

With funds running short, patients were forced to find money for medicines and surgical equipment that should have been provided free of cost under the scheme.

Government initiates action
The health department has initiated action based on a complaint submitted to the Chief Minister by M Murali, general secretary of the district Congress committee, alleging irregularities in fund utilisation and unauthorised appointments. The Medical Education Department has sought a report from the additional chief of Kottayam Medical College.