But there’s also a smart way to reverse the equation
We are chasing a mirage in healthcare. Even as income levels rose, the cost of healthcare kept going up. The result: the masses still cannot afford good quality healthcare. It’s a vexing problem that governments across the world are grappling with. But there’s one person who might have found a solution to this problem. He has managed to do what was considered impossible so far: deliver world-class healthcare at abysmally low cost. Devi Shetty’s unique model of healthcare has helped save the lives of many across India and elsewhere in the world. And it might just spawn what academic researchers call a “Third World solution” to a problem that the whole world is facing. In this interview, Shetty explains how he has made healthcare affordable, what the role of government in healthcare should be, and why India is rather well-poised to take the healthcare challenges head-on. Excerpts:
The premise on which Narayana Hrudyalaya is based:
When I was at Guys Hospital in the UK, I was involved with finance planning with my boss who was the chief cardiac surgeon. I learnt a lot about maximizing whatever limited resources you have to do a lot of operations. So I realized that if I have to succeed as a heart surgeon, I have to look at the business side of healthcare, else I might remain a good surgeon doing only 1-2 operations a day.
The greatest problem of the healthcare industry in India is that the largest player in corporate healthcare, his turnover is Rs 800 crore or Rs 1,000 crore. Look at any top corporate hospital, listed entities in India. Their revenues are a few hundred crores and the turnover of some of the Maruti car spare dealers is more. So unless you have the size, you cannot challenge the cost of the inputs and the only way you will have the price control is if you have the size. Wal Mart built huge chains of shops all over. So they had the size and they could dictate terms from any company starting from Procter and Gamble to potato growers – they could insist that high-quality potatoes be grown at a price. See, what do farmers want? They want some protection and they want a steady market. So if he’s growing 10 tonnes of potato and someone says you grow 10,000 tonnes, we will fund you for growing, we take the risk. But grow very good quality potatoes. That’s how it is.