Healthcare in India: Towards an Integrated Approach
Bhavdeep Singh, CEO, Fortis Healthcare, in a conversation with CFO Insights, describes the healthcare landscape in India
Could you walk us through the landscape for healthcare in India?
There is a great deal happening in the Indian healthcare industry today. With that said, it is important to know that India carries a disproportionate 20% of the world’s disease burden with only 17.5% of the world’s population. This scenario is compounded by an ageing population and the growing incidence of chronic lifestyle diseases resulting from sedentary habits. In addition, we also have a high incidence of communicable diseases, arising from poor hygiene and sanitation.
The Government provides primary care and limited secondary and tertiary care in key cities while the private sector provides a significant part of secondary, tertiary and quaternary medical care with a focus on metros, tier I and tier II cities. However, access to medical care remains a challenge with the availability of only 1 hospital bed per 1050 patients. This must be bridged with the addition of at least a hundred thousand hospital beds over the next decade.
There is thus a need to rapidly create and scale up healthcare institutions and infrastructure through fresh investments and by unlocking unutilized assets. The creation of healthcare infrastructure is expensive, and gestation periods for recovery are typically long. Government must make investment in healthcare infrastructure sustainable by introducing a package of significant measures and incentives that reduce the burden on the capex side as well as bring down input costs that impact ongoing operations.
Additional manpower will also be required by way of trained doctors, nurses, paramedics and healthcare administrators. Augmenting capacity by creating world class medical colleges and training institutions will thus help to bridge this shortage. Throwing the gauntlet to private enterprise and making it feasible for them to participate in sectoral skill development efforts would go a long way in catalyzing this process.
How can private players make healthcare services more affordable and accessible to meet the unmet demand across urban, semi-urban and rural regions?
There are no easy solutions and an integrated approach to healthcare is necessary. This will involve reducing the burden of disease through aggressive public health programs focused on improving health consciousness and healthy lifestyles, improving cleanliness and hygiene, mass immunization efforts to eradicate communicable diseases, building a robust system of primary health so that diseases can be detected, treated and contained in their infancy and at much less cost.
If you look at healthcare prices in India over the last ten years, these have remained muted, lower than inflation and much below those in the neighboring countries of Singapore, Thailand, Malaysia etc., leave alone the Western world. Not only has this created opportunities for medical tourism but India has also come to be regarded as a high quality centre for reasonably priced complex medical treatment. We have achieved some of this through the innovative use of asset light frameworks, O&M models, frugal yet effective operating practices and aggregating our supply chain to bring down the cost of goods, thereby protecting and passing on significant benefits to our patients while keeping price increases modest.
However, in India today, as there is a virtual absence of social security platforms, healthcare comes at a personal cost. To mitigate this challenge, health insurance must be boosted, so that a significant section of the population gets medical cover.
In what capacity can the private and public sector further engage to enhance healthcare
delivery in India?
Though there are some successful examples of Public Private Partnerships in the country, there is a much larger role for them. The truth is that the industry and government have been talking of this for some time now. One model that we can consider is the Publicly Invested-Privately Operated (PIPO) model. Public investment in healthcare infrastructure can be complemented with the private sector brought in to leverage its expertise and utilize the infrastructure to deliver healthcare services. This model can be a win-win situation for all if the terms of engagement lead to a viable, equitable and fair solution for the stakeholders. We look forward to explore such opportunities in association with governments and contribute to improving healthcare services.
India is currently second to Thailand as a leading global destination for medical tourism.
What are the specific interventions that would position India as the leader in this category?
I think that before India can become a health care destination of choice, it has to first become a country of choice for travel. So, we are working with the various bodies that support travel and are partnering with them to make India an attractive healthcare destination. Given that, we must also work on our infrastructure by way of convenient transport, familiar cuisines, multilingual conversational capability since the absence of convenient long stay options and potential delays in obtaining and renewing medical visas are cited as some of the bottlenecks by our foreign patients. Attention to some of these issues would go a long way in being able to alleviate the problem.
What would be the implications of price control mechanism on the quality and range of medical devices and instruments in India?
As you might imagine, this is a complex topic and we are all trying to understand how it will impact the industry. Having said that I want to be clear that we support and agree with anything that improves access for all. At the end of the day, we are in the business of healing and touching as many patients as possible and we all need to work together to find a solution here.
How are technology and innovation redefining Indian healthcare delivery?
Like any industry in the world, we are no different and as such, technology is a big part if the solution going forward. Given the enormity of the healthcare challenge, while disease reduction is a clear strategy, technology too has a major role in expanding access. Telemedicine is beginning to play a significant part in reaching far flung areas where adequate medical help may not be close at hand. Take our e-ICU initiative where we provide specialized, 24x7, remote bedside surveillance to critically ill patients in far flung hospitals from a central hub in New Delhi. Patients at these remote sites are connected via internet and closely monitored by seasoned intensivists, available offsite. They continually advise the local doctor on next steps to be followed and handhold them to administer the best medical aid remotely. This service is particularly useful when only basic medical skills are available on site and the patient cannot be moved to a city hospital.
Separately, technology enabled initiatives are playing a major role in changing the paradigm for healthcare. Robotic surgery is one of them. High precision surgeries are being routinely performed at our hospitals using the latest Da–Vinci robots, untouched by human hand but under the direct command of highly trained doctors. The minimally invasive technique reduces damage to collateral human tissue, speeding up the healing process dramatically.
Other patient friendly initiatives use underlying technologies for patient convenience in booking appointments, record keeping, billing and follow up.
How is Fortis Healthcare innovating to deliver superior patient experience, quality and safety? What are the investments required in this regard?
To truly understand how to deliver a superior patient experience, we must first have a platform to measure how we are doing. To that end, we have just rolled out a "best in class" medium to measure and understand patient/attendant feedback. In addition, it is worth mentioning that we believe that the tangible quality of patient experience is directly dependent on the quality of the medical outcome and its predictability. To this end, we are driving an important initiative to measure and report patient outcomes, and publish them, as per the globally prescribed and accepted ICHOM format. We have also contributed to the creation of this model alongside world leading hospitals and the Harvard Business School, under the guidance of Professor Michael Porter. Presently, the outcomes are being reported for many of the heart diseases and cardiac interventions. This makes comparison possible with global best practice benchmarks and positions us for constant improvement and evaluation. Our track record shows that our outcomes are amongst the best being achieved globally. It also gives patients some comfort as they can evaluate the predictability of success and make an informed choice regarding procedure and hospital. Outcome reporting is now being extended to other areas such as orthopaedics that will include knee replacements.
Is Fortis Healthcare looking to build sustainable competitive advantage through acquisitions and partnerships or by building internal capabilities?
I think that when you look at the area of growth, it is clear that growth will come in all shapes and sizes meaning that over time, it will likely be a combination of all of the above. We have critical mass in India and continue to expand by deploying asset light models. This includes bolting on bed capacity, in hospitals which have earned the right to grow as they experience high occupancies. We are also commissioning capacity in existing shells. Apart from this we are extending our expertise to partners through Operate and Manage contracts where CAPEX is being made by our partners and we bring in the skill set.