Sakeena Suliman – Cii News | 05 June 2014/06 Shabaan 1435
Doctor Devi Shetty wants to encourage people to start low cost hospitals and dissociate quality healthcare from affluence. He wants to prove to the world that the wealth of the nation has nothing to do with the quality of the healthcare its citizens can enjoy.
“It’s possible,” says Shetty, “You just need the willingness.”
Shetty is the chairperson of Narayana Health in India and opened the doors of its first 250 bed hospital about 13 years ago. “Today we have 23 hospitals. We have close to 7000 beds and 10% of the heart surgery done in India is done by our group in India. Now we are in the process of adding 30 000 beds, hopefully in another seven years.”
Their facilities care for patients from over 76 countries and is accredited by the Joint Commission of the United States – the commission which recognises American hospitals.
While many may perceive the facility to be a low-cost Indian healthcare service provider, Shetty clears up the misconception. They are engaged in a passionate journey to establish themselves as the lowest-cost, high-quality healthcare service provider in the world. There is no compromise to the type of healthcare given to patients.
“We want to maintain the highest standard like any of the US hospitals at a fraction of the price. But there is no question of any compromises. It is just intelligent use of infrastructure that you create,” says Shetty, “We believe that the charity is not scalable. But good business principles are scalable. We are not running a charitable company… Our entire strategy is reducing the cost.”
They are a for-profit company with investors like JP Morgan and AIG who invest and have a small stake in the company on board. Shetty explains that low costs allow people to pay for themselves and also influences government to come up with low cost insurance programmes. Their unique business model has become a Global Healthcare and Harvard Business School case study.
“Also whenever there is a short fall civil society comes forward and they donate money for a specific operation. So it’s a culmination of many things what we are doing, helping the poor people. Ultimately we have to run the hospital like a business. But the purpose of business is to reduce the cost. Not maximising profit but profit is important for the growth of the institution and upgrade of the institution and to retain the talent.”
South African medical procedures are some of the most costly in the world with South Africans on medical aid paying more than many First World countries for hi-tech medical procedures according to a survey by the International Federation of Health Plans. In South Africa, approximately 8 400 coronary bypass operations are performed per year. The majority of which is done in the private sector. A patient can cough up to R304 000 for this surgery.
The Narayana Health facility that Shetty is based at has the infrastructure to perform about 60 major heart surgeries in a day. Currently they perform 32 to 35 major heart surgeries in a day. Forty to 50% of the heart operations undertaken at the hospital are heart bypasses done at a cost of about $1400 (R15100) to $1600 (R17200). Their target is to reduce the charge to $800 (R8600) per bypass. In 2010 India had 0ver 800 000 foreigners visit the country just for medical procedures which could be provided at much lower costs than their home countries.
The reason for the exorbitant cost of medical healthcare is that countries are not investing in building more medical colleges and nursing colleges says Shetty.
“You need to open up the medical education whether it is a private enterprise or government. Government should build more medical colleges. This world is desperately short of medical manpower. As long as there is a shortage you cannot reduce the salary. You can’t control the cost. And man power cost is a big cost across the world. We believe that government should help every country to train thousands and thousands of doctors, nurses and technicians. Then 50% of your problem is solved.”
The other half of the problem is solved by building hospitals well equipped to deal with quality healthcare at a low cost. This, he says is possible depending on the way you look at the hospital.
“Why should the hospital be centrally air conditioned? Why should it have very expensive marble and granite? You don’t need it. No patient has ever asked for these facilities. A patient only asks for a compassionate and caring person to take care of them. They don’t have any value for these five-star luxuries.”
India is one of the largest suppliers of generic medicines. According to Shetty it is because they have one of the largest numbers of US Food and Drug Administration approved manufacturing units.
“We get medicines at a very, very low price because the government controls the price of medicine in India. Drug companies cannot fix the price. So we get medicines, good quality medicines at a very low price, we are lucky that way.”