Shifting the Paradigm in Indian Health Care: Results will follow when delivery, drug, device and diagnosis innovations occur simultaneously
Health care has progressed considerably in India. Targeted reforms have achieved improvements in key health indicators such as institutional deliveries, outpatient cases, complete immunization, availability of diagnostic and family welfare services and disease control programs.
But on the flip side, each year 39 million people continue to be pushed into poverty as they cover health care costs out-of-pocket. Only 25 percent of Indians are covered by insurance. At 4 percent of its GDP, India’s health care spending lags significantly behind other BRIC nations. And the country needs an additional 1.8 million beds and 1.54 million doctors to meet its growing demands.
Indian health care continues to face challenges of affordability, availability and quality for the following reasons:
1) Lack of appropriate government interventions: Resources are allocated poorly at government-run Primary Healthcare Centers (PHCs) in rural India: 8 percent of the centers do not have doctors or medical staff, 39 percent do not have lab technicians, 18 percent do not have a pharmacist.
2) Chronic shortage of highly skilled doctors: Increasing population and disease burdens along with inadequate resources have led to a perpetual demand-supply gap of medical professionals and health care resources in most parts of the country, especially in rural and semiurban areas. According to a recent study, as many as 40 percent of rural postings by trained medical graduates and postgraduates in different states in India are not filled.
3) Difficulty in revenue recognition: Although many people in rural India can pay for health care services, enterprises grapple immensely with revenue recognition.
4) Inability to develop relevant technological solutions for the Base of the Pyramid: Often, enterprises fail to understand the needs and ground realities of their target segments before developing and attempting to implement innovative products and services. There have been examples of businesses with great products that have not been able to convince their customers of the need. This makes their business model susceptible to failure socially as well as financially.
5) Difficulty in replicating business models across geographies: Achieving sustainability is the overarching challenge for every entrepreneur in a country like India, where the nuances of conducting operations and procuring revenue change from one target community to the other. As most business models are developed to suit a particular geography or community, the replicability of these business models becomes extremely hard.
6) Lack of patient capital: Enterprises, specifically the ones attempting to implement innovative market-based business models, seek capital that allows them to experiment. Lack of such patient capital makes it difficult for businesses to sustain for long.
But there is a growing number of enterprises that are changing the health care landscape in India by addressing current inefficiencies in the market, such as restricted outreach to rural areas, presence of spurious drugs in the market, limited data/information availability for consumers to make informed medical decisions, and few financing options which enable customers to afford health care. Here are a few examples of enterprises that are using technology to drive their interventions:
• PharmaSecure leverages technology to solve problems of counterfeit drugs. It does so by tagging each drug with a unique ID that can be tracked from source to consumption by the patients.
• iKure, a network of Rural Health Centers (pictured above), provides primary care treatment and is equipped with a pharmacy which dispenses genuine drugs. It has also developed a Wireless Health Incident Monitoring System (WHIMS) which is a cloud-based platform to enable exchange of patient data and advocacy of health care programs.
• The government of Indian state Rajasthan runs a series of drugstores across district hospitals and primary and community health centers. Called Life Line Drug Stores, these pharmacies procure drugs and surgical instruments directly from manufacturers and pass on the cost benefits (estimated to be 30-54 percent cheaper) to buyers. This initiative has increased accessibility of generic drugs to consumers.
• Ziqitza and GVK EMRI offer emergency and referral transport services. In a country where ambulance services are still largely unorganized, with each hospital running its own, there is often an absence of immediate medical response in times of emergencies. Ziqitza runs a fleet of ambulances while GVK EMRI runs a medical emergency response and assistance helpline called 108.
• Forus Health has created a product called 3nethra, which is a portable, noninvasive device to detect five eye-related ailments. The device does not need a doctor to be operated, but can be run by a technician with a little training. The low doctor-to-patient ratio in India makes this extremely useful.
• Apollo Telemedicine Networking Foundation is the nonprofit arm of leading Indian private hospital chain Apollo. The foundation runs telephone-led consultations, treating patients remotely. Its website says that it provides medical advice in about 25 disciplines and was the first to offer telemedicine in South Asia.
• BioSense Technologies has developed a noninvasive device called uChek, which is a smartphone-based portable diagnostic system that can perform a wide variety of tests ranging from routine urine analysis to specialized tests for disease detection.
These enterprises highlight that innovations at every stage of the health care ecosystem are paramount. When delivery, drug, device and diagnosis innovations occur simultaneously, the Indian health care market will witness a paradigm shift.
Enterprises, irrespective of the area of innovation, have to ensure that their service/product offering is pertinent and applicable to their target audience. The focus should be on creating “pull” technologies (the outcome of an identified gap) rather than “push” technologies (an existing process, service or product force-fit into the gap).
The burden of a paradigm shift should be placed on business models and not on cultures and behavior of target communities. In addition, business models should allow flexibility for them to be replicated across geographies. This, along with ease in accessing capital, will lead to achieving impact, sustainability and scale.
Gagandeep Bakshi heads investment banking at Intellecap.
- Environment, Health Care