The Government could have saved Sh3 billion in the first phase of the controversial Sh63 billion medical equipment leasing scheme had it bought them instead.
The contractor who supplied their first lot of the Managed Equipment Service (MES) at Sh4.5 billion yesterday said purchasing the equipment could have cost the Government Sh1.4 billion.
Shenzhen Mindray, a Chinese-based company, was awarded a contract but subcontracted Megascope Healthcare Kenya Limited to supply, install, maintain and facilitate training of the healthcare personnel to handle the equipment.
However, Megascope Healthcare general manager Renne Lupalo yesterday told the Senate ad hoc committee that while it would have been cheaper to buy the equipment, there are costs the Government is exempted from, including maintenance, training, insurance and replacement of the damaged equipment, under the leasing deal.
Under the contract, Shenzhen Mindray was to supply anaesthetic machine, electrical surgical unit, theatre lamp, theatre table, resuscitaires, instrument trolleys, linen trolleys, patient stretchers and patient trolleys to the initial 96 health facilities.
Later, another 19 health facilities were equipment.
“Leasing might be the best option because it removes the headache of maintenance and repairs from the ministry. If the government were to do a direct purchase, it would have cost less. However, within two years, it would have spent more money on maintenance and repairs,” said Lupalo.
“The supplier does not take care of wear and tear if the Government makes a direct purchase of the equipment. From our experience, leasing would be the best option as it takes that headache away from the procuring entity and transfers it to the contractor” Lupalo said after Bomet Senator Christopher Langat asked on what advice he would give the Government.
He added: “Leasing has many parameters, including servicing. The contract envisages servicing of the equipment as being very important, even if it means a machine is replaced every day at our cost. However, that is not to say we took advantage of the government.”
Lupalo told the Isiolo Senator Fatuma Dullo-led committee that the medical equipment leased were identical in all the health facilities, but with some variations depending on the specifications from the ministry.
Dullo had demanded to know from the contractor and their agents why leasing was more expensive.
In his response Lupalo said: “We replace the equipment, in the event they are worn out, with new ones. We have already done this in Taveta, Malindi and other coastal areas. Because of the salinity of the region, it is expected that the machines will rust. We replace them with new ones at the cost of the contractor.”
“It is a probability not the actual cost,” Lupalo said.
Megascope said they have supplied, installed, commissioned and trained health personnel in the 125 healthcare facilities in all counties as well as national referral hospitals.
Senators accused Megascope of lying it had supplied and commissioned the theatre equipment at Garbatula Level four hospital in Isiolo. They legislators claimed the equipment was still wrapped up in a container.
The senators who had on Monday visited the Garbatulla and Meru level five hospitals insisted the medical equipment supplied to the Isiolo facility had not been installed.
Another one supplied to Endebes hospital in Trans Nzoia has not been operational due to lack of power, the lawmakers said.
Senators asked Shenzhen and its partner Megascope if they would refund money for equipment supplied but not in use.
“We will recommend to the Ministry of Health to recover the money paid to the company for areas that the equipment has not been installed,” Moses Wetang’ula (Bungoma) said.
Nominated Senator Mary Seneta sought to know from Megascope how they signed a completion certificate with the ministry yet some equipment have not been installed.
“Meru County is still constructing a building where the theatre machine will be installed yet you have said you had already signed a certificate of completion. How did you sign the certificate in 2017 yet the equipment has not been installed to date? said Seneta.
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