St Joseph's College Of Business Administration

1. Delivering World – Class
DelHievalthe Crarei Anffogrda bWly orld –
Class
Health Care,
Affordably Group-
B4

2. AGENDA
 Introduction
 Innovations at Indian hospitals
 Cost Factor
 Organizational advantages
 Hub & spoke configuration of assets
 Rethinking who does what
 Asserting Frugality

3. INTRODUCTION
 India’s health services- Innovation (Abysmal)
 Rise in infant mortality, Diabetics, Cancer And
heart related issues.
 Constrained supply of cure to the blind people.
 750,000 doctors and 1.1 million nurses.
 Short Supply of hospital beds.
 Ability to pay?

4. INNOVATIONS AT Indian hospitals
 Target well off patients and patients with low
income.
 Attract large volume of patients due to low costs.
 Arvind Eye Care System
 Extraordinary service Inspires hospitals in other
developing and developed nations.
 Narayana Health in America competes with AHCS.
 Uninsured and underinsured patients will get high
quality treatment at considerable low cost.

5. INDIA’s Hospital exemplars
 40 hospitals with innovative strategies providing
world class health care.
 A study was made on 9 such projects, accredited by
JCI & NABHHP.
 Problems of eye, heart ,kidney, cancer , orthopedic and
maternity care were treated.
 95% cheaper than American hospitals.
 The Apollo Hospital Group in Hyderabad, have better
outcome than the international standards.
 NH’s mortality rate for coronary artery bypass is lower
than 143 hospitals in Texas.
 Arvind Eye Care is much more favorable than those of
UK’s NHS.

6. Cost factor
 Though the high cost of equipment and land , India
provides low cost services.
 The cost of labor plays an important role.
 They earn 20% t0 70 % of what Americans do.
 AECS earns $50000 than compared to $253,000 of
U.S
 NH’s Cardiac surgeons $225,000 ,
whereas U.S surgeons $408,000
 Medical staff earns only 2% to 5% of what U.S pays.

7. Organizational Advantages
 Hub-&-spoke configuration of assets
 An innovative way of determining who should do
what
 Focus on cost effectiveness rather than cost cutting

8. Hub-and-Spoke Configuration of Assets
 Urban hubs (high quality, talent, sophisticated
equipment)
 Spoke facilities (diagnosis, routine treatment, follow
up care)
Ex. HCG with 17 spoke hospitals and $8 million Cyber
Knife in the hub.
 The hub-&-spoke approach is facilitated by the use of
technology like telemedicine.
 This technology lowers costs like lost wages during
time away from work, transportation, room and
boarding, etc.

9. Continuation....
 A hub-&-Spoke architecture also helps create large
volumes.
 That allows hospitals to reap economies of scale in
purchasing medicines, supplies and equipments.
 Which in turn increases physician productivity
 Which increases the efficiency in use of equipment
and facilities
 Which result in lower costs
Eg. Evaluation of patients, MRIs

10. Continuation....
 The hub-&-spoke configuration also allows hospitals
to improve quality. It does that by:
1. Attracting and retaining doctors seeking to
improve their skills rapidly.
2. Developing and continually updating treatment
protocols that reduce errors.
3. Creating specialists in relatively rare
subspecialties of medicine.
4. Promoting innovation that suits local conditions.

11. Rethinking Who Does What
 Shifting tasks match the skill levels of people with the
basic requirements of tasks ( Eg. Tasks of doctors
and nurses)
 Categories of low cost health care workers at one end
& highly focused specialists on the other.
 At the lower end LVPEI, Arvind
 At the high skill end- HCG, LVPEI

12. Continuation....
 Hospitals maximize their efficiency by increasing
the number of staff supporting their most skilled
surgeons.
Eg. Arvind
 To increase surgeons' productivity the amount of
time taken to move a patient from one operating
theatre to another has to be reduced.

13. Asserting Frugality
 Goal( INDIA) – Maximize the no. of patients treated
 U.S. - Maximize the no. of procedures conducted
Cost -cutting measures used:
 Maintenance & repair of expensive technology
Ex. NH contract with Trimedx (diagnostic
equipment)
 Reuse of single-use products- Steel clamps
(CARE, NH)
 Pay-per-use deals (GE, Philips,siemens)

14. Continued…
 Match the sophistication of equipment to task
Ex. LifeSpring, Vaatsalya, Apollo- sutures
 Developed cheaper substitutes
Ex. CARE –stents ($240-$360) per piece
Aravind –Aurolab manufactures intraocular lenses
U.S.- $200, Aurolab - $2 (2013)
 Indian hospitals follow a fixed-price model
 Cost awareness across the organization
NH doctors receive- P&L data, comparative
performance data

15. Lessons for U.S. Hospitals
 Barriers- Fee-for-service incentives
investments in extensive infrastructure
 Opportunities- treat higher volumes of patients
salaries are only part of the equation
 Implementation of Indian practices in the U.S.
Ex. CareMore-task shifting
Vermont Dept. of Health- Hub & spoke
Steward Health Care – tele-ICU system

16. THANK YOU