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The Federal Government’s approval of a 50 per cent subsidy for the electricity consumed in hospitals across the nation has generated excitement among major tertiary hospitals in Lagos State.
The hospitals include the Lagos University Teaching Hospital, Idi-Araba; the Federal Medical Centre, Ebutte-Metta; and the Federal Psychiatric Hospital, Yaba.
While awaiting the official circular that will outline the details of the electricity subsidy, the federal hospitals’ managers said the 50 per cent cut would provide much-needed financial relief to their institutions, and improve their operational efficiency and patient care.
The Minister of State for Health and Social Welfare, Dr. Tunji Alausa, announced on Thursday that the Federal Government had approved the 50 per cent electricity subsidy for public hospitals.
According to him, this gesture aims to reduce the running costs for public hospitals and alleviate the impact on patients.
The minister disclosed that the government was aware that universities and hospitals are having challenges paying the bills.
Alausa said the Federal Government was planning to meter all businesses running in each of the institutions to prevent paying subsidies to private businesses.
Reacting, the Chief Executive Officers of the federal hospitals who spoke exclusively with PUNCH Healthwise, commended the federal government for reducing the electricity tariff for federal hospitals by 50 per cent.
They described the 50 per cent subsidy on electricity tariff as a welcome development that would bring relief to hospitals struggling with high electricity bills.
The Chief Medical Director of LUTH, Prof. Wasiu Adeyemo, lauded the government for the subsidy, saying it would improve the quality of care provided in hospitals.
“This subsidy would help reduce the financial burden on our hospitals, which have been struggling with high electricity bills. We are grateful to the government for this move, which would enable us to provide better healthcare services to Nigerians,” Adeyemo stated.
Adeyemo revealed that LUTH had been spending millions of naira on electricity bills, with a recent bill of N69 million in March and N252 million in April.
He noted that the subsidy would help reduce the hospital’s electricity bills, enabling it to allocate more resources to patient care.
Adeyemo also disclosed that the government has promised to invest in renewable energy for hospitals, with a budget allocation for 2024 and 2025.
He added that LUTH plans to invest 10-20 per cent of its annual budget in renewable energy to complement public power supply.
Corroborating him, the Medical Director of the Federal Neuropsychiatric Hospital, Yaba, Dr. Olugbenga Owoeye, commended the government for the subsidy, saying it would make healthcare services more affordable and accessible to Nigerians.
“This reduction is a welcome development. It alleviates the financial burden on our institution, allowing us to provide more affordable services to our patients. For instance, what was once a cost of 10 million naira can now be reduced to 5 million naira, which is a significant improvement,” he noted
Owoeye also emphasised that this cost reduction will enable the hospital to enhance its service quality.
He added, “We have faced challenges with unreliable electricity, which impacts our ability to use electronic medical records effectively. This new funding will help address such issues and improve the overall quality of care we provide.”
He, however, said there is a need for the government to issue an official circular to formalise the recent announcement on electricity cost reductions for federal hospitals.
On his part, the Medical Director of FMC, Ebutte-Metta, Dr. Adedamola Dada commended the Minister for Health, Professor Ali Pate and the Minister of State for Health, Dr. Tunji Alausa for their effort in ensuring the initiative offering a 50 per cent discount on medical equipment for federal teaching hospitals came to pass.
This discount, Dada noted, is a step in enhancing the quality of care provided by these institutions while keeping healthcare affordable for Nigerians.
“It is a fantastic policy and I think it is part of the process that the government, particularly the present ministers in the Federal Ministry of Health are using to support federal teaching hospitals, improve the quality of care and ensure that care is kept within a reasonable cost so that Nigeria can afford it.
“One of the biggest challenges that any hospital in Nigeria faces is electricity. With this 50 per cent discount, it is a great relief and I think we all need to be very grateful to the government for this and what they have done.”
PUNCH Healthwise had consistently reported how the newly implemented tariffs have crippled essential services in tertiary and private healthcare facilities located in areas classified as the ‘Band A’ category, leaving them struggling to survive and on the brink of imminent shutdown.
The recent implementation of a new tariff increase of 1.3 per cent for Band A customers by NERC, as captured in the Multi-Year Tariff Supplementary Order, has not in any way favoured healthcare facilities and has plunged many of them, especially teaching hospitals and privately-owned, into a desperate battle to stay afloat in the face of escalating costs, which threatens the very core of patients care.
The President of Save A Life Foundation, Dr Richard Okoye in a recent viral video lamented the huge electricity bill he recently got from the Port Harcourt Electricity Distribution on his Rivers State hospital.
Okoye in the video said his bill increased to N25,300,000 because he was on Band A.
According to him, the Federal Government’s decision to increase the band’s tariff, which he described as a ‘Band A tariff epidemic”, to N225 kilowatt per hour from the current N66 would destroy the healthcare system of the country, adding that hospitals only render essential services and should not be seen as business centres.
Similarly, the Guild of Medical Directors of Nigeria also reported to have raised the alarm that the hike in electricity tariff is straining private hospitals, forcing some to shut down.
The Guild disclosed that no fewer than eight private hospitals in Maiduguri, the Borno State capital, recently shut down over the high cost of electricity supply and insecurity.
