Download LLDS_SIHFW Excerpts - HS-Prod

Excerpts from A Study on RMRS done by State Institute of Health and Family Welfare on
Life line fluid stores.
Life Line Fluid Stores (LLFS)
Sixty percent of the societies established LLFS to provide monetary relief to patients. As
mentioned previously, the societies carry a mandate to provide free service to families living by
providing quality drugs and surgical items at affordable prices. These stores sell items that are
exorbitantly expensive in the open market on a cost-plus basis by adding a small margin as a
service charge. For example a standard bottle of intravenous 5% glucose saline would sell on the
open market for Rs. 29.65 plus tax. The same bottle was procured for Rs. 6.95 by an LLFS and
sold for Rs. 10. Similarly, a large number of drugs are sold at the LLRS at well below market
prices. The LLFS at Sawai Man Singh (SMS) Hospital, Jaipur thus provided monetary relief to Rs.
8.5 million to patients. In addition, competition from the LLFS has brought open market prices
down.
System of Exemptions:
As mentioned previously, the societies carry a mandate to provide free services to families living
below the poverty line, to widows, to freedom fighters, to the destitute and to citizens over 70
years. The Government has issued all families living below the poverty line medicare relief cards
that entitle them to free treatment. Freedom fighters also carry identity cards. For other
categories, means testing is informal and discretionary. An average of 15-20% of hospital
clientele receives free care.
Use of Funds:
Funds collected by societies are used mainly for the purchase of new equipment, for repair and
maintenance, for consumables, for contractual services for security/scavenging, for consumables,
and for drugs and medicine. Societies decide how to use funds and develop their own
transparent, flexible purchasing procedures.
1. Life Line drug Store at SMS, Hospital
Services Facilitated by RMRS
 Free emergency services
 24 hours emergency laboratory services
 Maintenance of private wards
 trolley and wheel services
 Contracting out for computer assistance, lift service, security, gardens maintenance and
cleaning services.
 Improved patient care
 Improved upkeep of hospitals and regular maintenance
 Central lab for bio chemical, pathological investigations and other diagnostic tests
 Life line fluid store
Life Line Fluid Store
In order to achieve various objects, the society brought into existence necessary infrastructures
whereby medicines are provided to the patients at the most competitive rates, also ensuring their
quality standards. To facilitate these activities, the Society provided suitable place and other
facilities to the manager of LLFDS at the SMS Hospital, Jaipur. The suppliers of the medicines
are approved on consignment basis and made available to the patients of the rate mutually
decided from time to time. Such activities are carried on under the name and style of "LIFE LINE
FLUID STORES" whose proprietary rights are vested in the society.
Life Line Fluid stories is a registered unit under the applicable provisions of Rajasthan Sales Tax
Act, 1994 and Central Sales Tax Act, 1956 both with effect from July 9, 1996 under registration
no. 1420/035664/AC/Cicle "A" Jaipur.
The suppliers Trust Closing Stocks at the close of the year is taken, valued at cost or market
price whichever is lower and certified by the contractor who has been vested with the powers to
manage the whole of the activities of the " Life Line Fluid Stores".
The contractor for managing LLFS is selected for 2 years. Every 2 years tenders are floated to
identify and selecting the contractor. Presently contractor is paid Rs. 17,500 per month plus 1%
commission on sales.
LLFS provides its services through 4 counters. Three on ground floor and one on 1st floor,
Counters of ground floor provide services round the clock.
A committee of three doctors has been constituted to decide the drugs etc.to be procured as per
guidelines. At present Dr. Ramesh Roop Rai is the Chairman. Dr. M.Mital is over seeing the
performance of LLFS. The average daily income of LLFS is between 85,000 to 1 lacs
The system of procurement followed by the Medicare Relief Society, S.M.S Hospital, Jaipur
is as under:A) For procurement of drugs, information is received from stockiest/ distributors in
B) Prescribed Performa.
C) A committee of three senior doctors is formed to scrutinize the proposals
received.
D) The committee after being satisfied with the quality of the product and the price
offered by the stockiest recommends the product for purchase.
E) Only those drugs and medicines that are approved by the committee are kept in
F) the life line fluid store for sale.
G) The same committee decides the selling price of these medicines by LLFS. While
fixing the sale price the committee sees to it that the difference between the
procurement price of the society and the selling price is not more than 10%
because the object of the society is to control the market prices and not make
profits.
H) The society does not place any formal purchase order to the approved stockiest/
distributors for supply of material. They just indicate the requirement. Based on
the requirement the approved stockiest/ firm is permitted to keep its stock for sale
in the LLFS. The Manager of LLFS checks the material put for sale by the
Dealer/ Firm at the time of supply.
I) The shop manager enters the material supplied in firm/ dealer wise. This will also
J) be entered in the challan and the challan will be submitted in the society office on
K) the same day.
L) The shop manager will issue the material as per requirement for sale to the
counter.
M) Every fortnight the stock registers along with bills will be sent to the society office
for payment and the society office will make payments.
N) The shop manager will deposit sale proceeds on the following day in the bank
account of the society and will also furnish the sale account and bank deposit slip
in the society office on that very day. The purchase and sale rates approved by
the committee shall be reviewed periodically and may be revised by recording
reasons.
The purchase system being followed by the Medicare Relief Society, S.M.S Hospital, Jaipur has
the flowing advantage:The quality of medicines is assured because a committee of three doctors scrutinizes all the
proposals. In the normal purchase process, price of the product is the only deciding factor.
The LLFS does not place formal purchase orders. It only provides shelf space to the firms for
placing of materials for sale. The suppliers are responsible for breakage, shortage etc.
Shelf space is provided for similar medicines to various manufactures on same rate that ensures
regular supplies.
Issues
It was brought out though LLFS is a doing very well, but according to drugs control act a qualified
pharmacist should be employed.
The contractual staff working in LLFS should be regularly trained. To prevent external influence,
they should be well paid.
It was also suggested that looking to ever-increasing demand on LLFS one outlet store might be
started in Bangar Hospital. It may particularly store the needed items for cardiology neurology,
neuro- surgery, cardiothorasic surgery etc.
Some members were of the opinion that LLFS should keep some more drugs like a drug store,
but worker of LLFS and most of the members felt it should not be done. Changing character of
LLFS to drug store would do more harm than good.
2. MRS Chittorgarh has taken certain innovative steps to use RMRS more effectively

There are two sub committees in the hospital related to RMRS- one is BPL committee
that consists of PMO plus two other doctors. This committee can purchase drugs up to
Rs.30,000 by calling three quotations without waiting for permission of RMRS executive
body. Another sub committee is for Life Line drugs store - it doesn't need to take any
permission from collector for purchases less than 30,000 (which is to be done by as king
quotation from at least 3 hours) and if it is more than 30,000- by open tenders.

Drugs other than available for admitted poor / BPL patients; are purchased through
vouchers to Life Line drug stores which are adjusted by RMRS

Hospital has Life Line drugs store. Manager is appointed through open tender for three
years. He has to deposits a fixed commission on the overall sale of variety of drugs /item
on LLDS. This year LLDS contract is given to co- operative store. This decision was
taken in view of bungling done by the then manager in the earlier year who was selling
medicines not approved for LLDS.
SIHFW, Jaipur