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Patient centric corporatization

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Patient centric corporatization

  1. 1. Patient-centric corporatization: Making the twain meet -Dr. Anuja Joshi First year, MHA (HO) Tata Institute of Social SciencesThe last decade has been a revolutionary journey for healthcare in the Indian subcontinent, as it finally begins to takecentre stage after prolonged subordination and anticipation. The excitement is palpable amongst healthcare providers,the government and other stakeholders alike, as Indian hospitals rise to stand up shoulder to shoulder with world classhealthcare providers. Driving this revolution is a wave of business restructuring - we know as Corporatization.Some say that this is just a part of the metamorphosis most sectors undergo in a fast developing economy like India.On a more critical note however, there may be more to it than meets the eye. The transformation seems well beyondapparent swanky infrastructures and medical technology. The very perception of patients, doctors & hospitals ischanging at a pace that is startling most of those involved and affected by the same. There is a paradigm shiftoccurring in the way healthcare will be delivered in the times to come. But again, should this be a matter of concern oreven thoughtful discussion?It should indeed, because healthcare is no ordinary sector. It is the unlikely business of saving lives.Where do we start?We could start with understanding the evolution of Corporatization in healthcare.Necessity was the most primary driver considering healthcare is an essential service in society. Given the enormityand the diversity of the population of a country like India, this ‘necessity’ probably was soon a challenge for anygovernment to manage. As a result, what should ideally have been a social security measure provided by the State,was opened to other organizations to provide as a service at a cost. It was at this juncture that healthcare wastransformed into a ‘sector’ subject to the formidable forces of the ‘market’.Healthcare is probably the most input-intensive and outcome-sensitive industry. The new players, who started singlyor in small groups, were struggling at both ends- first, to arrange for inputs whether in terms of capital orprofessionals and next to ensure favorable outcomes in terms of affordable and effective treatment. Risingexpectations and paying capacities of a burgeoning middle class, started creating a demand that called fororganizations, much larger and more organized than islands of private providers. Going back to the essential nature ofhealthcare services, the scope for business per se is both tremendous and relatively immune to typical marketfluctuations. This was a huge business opportunity in waiting. Thus was the advent of a new breed of players in theform of ‘corporations’ who promised a restructuring of the healthcare industry to world class standards.Some of the other major influences were lessons from the west, especially the health systems of the United States ofAmerica. State of the art hospitals, high paying jobs for healthcare professionals and the best medical technology inthe world were attractive ideals to aspire for.Accreditation was another inspiration from the west. Simply put, it was aimed to building and ideally runninghospitals at a benchmarked uniform international standard. Getting accreditation automatically offers the credibility ofmaintaining international standards for either the department or the hospital as a whole.Impact of corporatizationInitially, corporatization translated into well planned investments; quality infrastructure and creating a ‘brand’ imagefor the hospital. One of the first and key steps to sustain such a venture was finding a pool of multiple investors for thecapital and ensuring returns on this investment, through pricing. Having had some success with this, the next step wasscaling up in terms of volumes, to generate generous margins and cut running costs. What started with large singlehospitals was now developing into a chain of corporate hospitals spread over major cities in the country.These new hospitals also embraced quality infrastructure effectively. Infact, the interiors of most newly built hospitalscould give some of the best hotels a run for their money! Specially formulated healing environments for inpatient
  2. 2. departments, a flurry of well trained attendants and great food were just some of the creature comforts for those whocould afford them.Setting standard operating protocols was the other cornerstone of corporatization. Meant to streamline the working ofthe organization as per evidence based standards, they also assist newer professionals to learn the right way to dothings rather than rely on trial and error. Ownership in the meantime shifted to the hands of a separate board of management who were not necessarily doctorsbut trained in hospital management or business administration. Everyone else became an employee, including allmedical professionals who would be bound by the policy guidelines of the hospital. The hospital was now bigger thanany of its employees.The other side of the storyAt the receiving end of this transition, were patients with mixed reactions to the situation. Many of those who couldeasily afford it initially patronized these hospitals for the promised quality on offer. The market however, did notremain monopolistic for long, and competition was quick to set in. This competition unlike in other sectors however,did not lead to fall in prices. Not very adept at dealing with competition, hospitals resorted to adhoc marketing andnewer service attractions, without analyzing their potentials leading to a paradoxical increase in prices for the endusers. Very soon, the cost of corporate healthcare spiraled out of reach for the middle class. .The relative subordination of doctors in these hospitals, led to two groups: clinical and administration, both striving toensure their importance and decision making capacities. One of the probable options sought was defensive medicine,at the cost of the patient who had little choice but to agree. Fewer patients meant tighter competition and malpracticesbegan to creep in the system. The hospital/patient-doctor bond translated into a legal customer-provider contract withpatients dragging the once demigod doctors to courts!In the backdrop of the situation so far, it seems apparent that the gap between healthcare providers and patients iswidening at an alarming rate, and needs to be bridged before the damage is irreversible.The point to note here, is that corporatization like globalization, is an evolutionary phenomenon that is bound to havefavorable and unfavorable repercussions. The catch lies in maximizing the favorable outcomes and dealing with theunfavorable ones to minimize damage.Hence the need for making the twain meet, the only way being a patient-centric approach to corporatization. Patient-centric: Ethical, Intelligent and Affordable corporatization in that orderEthicalThe raison d’etre for healthcare is the patient and at stake is the patient’s life. There cannot be any hospital that couldjustify malpractices of any magnitude under the pretext of rising costs, evidence based medicine or just blatantcommercialism. Unless the hospital commits to ethical practices irrespective of the challenges involved, there is noway it can even attempt to regain the patient’s trust, leave apart loyalty.It is also important to remember that affordability is not a trade off for ethics. The human life cannot be equated withthe pay potential of the patient, and acts of both omission and commission count for unethical practices.IntelligentThe first important aspect of intelligent planning is comprehending ‘quality’. As discussed before, quality is oftenrelative, and customizing quality to the user is the key. There are certainly places where quality may be absolute likein case of infection control, but interiors can certainly be experimented with. Sky lit domes, well maintained internalgardens/ potted plants and children’s paintings can be brilliant alternatives to typical expensive interior options. Thefocus must remain on cutting/minimizing all avoidable input costs without compromising on the outcomes.
  3. 3. The second important aspect is a SWOT analysis of India as a market. We are a nation of volumes andvariations. Any hospital model must aim to reduce costs through large volumes. These numbers may however not beeasy to achieve in urban areas, simply because they are already saturated and land is dear. The idea then is to use thevariation. The tier 3 and 4 cities are growing faster than we can comprehend back home in our cities. Instead offighting over a contracting size of the pie in these urban areas, it makes absolute sense to reach out to the growingdemands in the semi-urban and rural areas. It is also preferable to train local residents to work for these hospitalsrather than haggle with reluctant urban staff.AffordableThe cost of quality healthcare is a rather interesting debate. That is because neither inputs nor outputs can becompromised with. Given the fact that investors would obviously be looking for returns, it is worthwhile making themunderstand why it takes time to make money in healthcare. Returns are slow, but usually certain, unless expectationsare unrealistic.An option here would be staggering and sharing input costs over time. This can be feasible in volume based models insemi-urban and rural setups. Diagnostic facilities, support services could be shared or efficiently outsourced in thelocal areas at very affordable rates. Other overheads like administrative costs, electricity and staffing could be kept atminimum possible with effective technology like HMIS, telemedicine and green hospital infrastructures.Public private partnershipsConsidering the major players in the health market are private/corporate and public companies, the most logicalconcept is the emerging trend for public-private partnerships, PPP in India. PPP, as Kent Buse and Gill Walt explainis a collaborative relationship which transcends national borders to involve at least 3 players, out of which one is acorporation (or industry) and the other, an inter-government organization to achieve a shared health-creating goal onthe basis of mutually agreed division of labor.PPPs could be of various types, either owned by public sector involving private players like in GAVI, SIGN or RBMprograms, or have NGOs involve corporate participation like World heart federation. The local governments maychoose to tie up with key private providers like Government of Chhattisgarh with Apollo and Escorts hospitals for the“Bal Hridaya suraksha yojana” for pediatric cardiac ailments or the Government of Gujarat, with IIM-A, FOGSI,Sewa and private practicing gynecologists for the “Chiranjeevi yojana” to ensure safe deliveries.Keeping in mind the promises PPPs offer to make, a word of caution may nonetheless be exercised. The concept isstill emerging, and there isn’t yet substantial evidence to prove its capability in mass application, so a gradual, andwell calculated approach would be pertinent atleast initially. A formidable, responsible and transparent governance toprotect from exploitation, forging of figures, and to ensure that public interest is preserved throughout as the target ofall activities. At a closing note, the relevance of the patient-centric approach deserves a reiteration. All of the options discussed above, are expansions of this very basic ideology. Whatever happens in healthcare must protect and benefit the patient before anyone else, because he is the most vulnerable of all stakeholders involved. The most reliable question for any decision-making in healthcare is whether it benefits the patient. If it does not benefit the patient, don’t do it because it won’t benefit anyone else in the long run either!

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