The Need for a new Healthcare Model and some Concerns

The organized private healthcare in India needs to urgently evolve a new business model.

The present model faces challenges as the government goes about changing the healthcare landscape of the country in a ham-handed manner. The price controls that are being put in place essentially mean that private healthcare players will have to develop a new business model, which is ultra low cost and allows them to accept patients at the government mandated low prices.

The Ayushman Bharat Scheme and its different versions being developed by the state governments appear to be a precursor to some kind of Universal Healthcare system in India. The government in itself is not in a position to significantly increase its own healthcare spending on badly needed public healthcare infrastructure. Thus, it will willy-nilly rely on private healthcare, which in any case caters to a majority of the citizens of our country. This is likely to see the emergence of a low-cost health care system, which will serve the needs of the masses.

The Contours of the New Model

Going by the prices on offer from the government for various medical procedures, the new model will have to be quite bare bone. Essentially, this would mean less number of people employed in the hospital, very little by way of ”support services”, no private rooms, generic medicines (my fear is of inferior quality as well, as India has over 30000 pharmaceutical companies with poor regulation in place) and very little by way of patient comfort. The model can only work on large volumes of patients and high patient throughput.

The Concerns

While the model can be developed, the biggest concern will have to be the quality of care that will be delivered. The model’s cost-driven approach completely ignores the minimal clinical quality standards that must be delivered. Presently too, this is a nebulous area as the quality of health care services vary widely and there are no comparative acceptable benchmarks. Large private corporate hospitals have their own standards often comparable to global standards and they have systems in place to monitor the quality parameters and clinical outcomes. Small, private nursing homes have fuzzy standards not clearly defined and stated. No one publishes there outcomes.

To make matters worse, in India we do not have a clinical quality watchdog, which keeps an eye on medical processes and outcomes. Thus, hospitals can report their outcomes and clinical data as they wish. This is clearly a recipe for disaster.

While the implementation of National Health Protection Scheme (NHPS) may lead to better access to medical care to a large number of citizens, the large private healthcare players may get deluged with patients far beyond their capacity. When the payor will be the government through insurance companies, everyone would want to access the highest level of care possible. This in itself is fine and laudable if the care available in the country is of a uniformly high quality. However, in India, the quality of care varies tremendously and therefore the private healthcare players with high standards of care may find themselves unable to cope. Sadly, they may end up compromising on these very clinical standards to manage the patient volumes, thus blunting the competitive edge that they had to begin with.

The third big concern is the ability of the government agencies to be able to effectively implement this ambitious scheme. While the mandarins in Niti Aayog are burning the proverbial midnight oil to get the scheme off the ground, the challenge is indeed enormous. The best-planned schemes come to naught if the execution is tardy. That sadly has been the fate of almost all such similar schemes implemented earlier in different states. The government’s track record is hardly inspiring and the stakes this time around are truly high.

The private healthcare players, however, have their task clearly cut out for them. They have to find a new business model, which delivers world-class care to a very large number of people at a cost which is impossibly low. The sooner they get on with finding the right business models for themselves, the better off they will be.

The views expressed are personal

 

 

 

 

 

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