This document discusses rural healthcare in India and emerging business models. It provides context on the definition and key facts about rural India. Rural healthcare faces challenges related to affordability, accessibility, awareness, quality and more. Emerging business models discussed include telemedicine, healthcare information systems, and hospitals on wheels. Two case studies are summarized - Apollo Telemedicine, the largest telemedicine network in India, and E-Health Point Services, which provides telemedicine consultations. Both aim to improve rural healthcare access through technology and innovative business models.

1. Mithileysh Sathiyanarayanan & Sharanya Rajan
ROLE OF TECHNOLOGY AND INNOVATION
IN RURAL HEALTHCARE IN INDIA
October 2015

2. RURAL INDIA: A
SNAPSHOT
• DEFINITION OF RURAL INDIA
• THE MOST STANDARD AND WIDELY ACCEPTED
DEFINITION IS GIVEN BY CENSUS OF INDIA IN 2001 WHICH
DEFINE AN AREA AS RURAL AREA IF IT FULFILLS THE
FOLLOWING CONDITIONS;
(1) POPULATION DENSITY OF LESS THAN 400 SQ KM
(2) ATLEAST 75% OF THE MALE POPULATION ENGAGED IN
AGRICULTURE
(3) NO PRESENCE OF MUNICIPAL CORPORATION OR BOARD.
• QUICK FACTS
• RURAL INDIA – 70 % OF THE TOTAL
INDIAN POPULATION TOTAL RURAL
POPULATION :- 833 MILLION INDIVIDUALS
CONTRIBUTION TO THE NATIONAL
SAVINGS – 33 %
•CONTRIBUTION TO TOTAL
CONSUMPTION – 57%
CONTRIBUTION TO TOTAL GDP –
45%
• (SOURCE: IBEF, NCAER AND CENSUS OFINDIA)
Series1,1993-
94, 6.36
Series1,1999-
00,10.80
Series1,2004-
05,12.87
10,21.18
Monthly Per Capita Consumer ExpenditSuerriees-1,2009-
Rural ( US $)
Source: Data Extracted from Key Indicators of Household Consumer Expenditure in India
2009-10, Ministry of Statistics, Government of India
•The monthly household per capita consumer expenditure (MPCE)
in rural areas has increased by more than thrice from 1993- 2010.
• Rural areas are going high on spending.
•But in the actual terms, they are spending half in comparison to
their urban counterparts.

3. RURAL HEALTHCARE :
OPPORTUNITIES
estimated to be 26.5
at purchasing power
•India BoP healthcare market is
billion 2005 International dollars
parity dollars. In 2008
•The average rural population meant to be served by each
health sub-center and primary health center is more than
6000 and 36000 respectively.
•It is estimated that nearly 1.75 millions of beds will be
required to achieve the status of 2 beds per 1000 people,
700,000 doctors to reach one doctor per 1000 population by
2025. (PWC)
•The total capital investment to reach the above targets is
estimated to be US $ 80 billion approx.
• 8% of the total expenditure of rural people on health.
Series1, Labou
r Room,64.9%
Series1,Opera
tion
Theatre,36.0%
Series1,With
4-6
beds,59.3%
ut electric
supply, 14.2%
Series1,Witho
ut Water
suSeprpielys,11,2W.4i%tho
Series1,Reach
able inall
weather
conditions,92.
5%
Computer,47.
0%
Telephone,54.
Series1,Wit3h%
Facilities at Primary HealthcSaerrieesC1e,Wntitehrs
ns,2583
icians&
Gynaecologists,
Seri2e2s711,Surgeo
Series1,Physici
Series1,aOnsb,s2te9t4r9
Series1,Paediat
ricians,2991
Specialist
Doctors,11361
Series1,Genera
l Medical
OSeffricieesr1s,T9o9t3a3l
aphers,2724
Shortage of SMeraiensp1,oRwadeirogartCommunity HealthCenters

4. RURAL HEALTHCARE:
CHALLENGES
Affordability
Accessibility
Awareness
Quality of Healthcare
Services
Distribution and Reach
Recruiting skilled manpower
Tackling social issues and local beliefs (
Self medication)
Creating awareness among the rural
consumers
Changing the mindset of the rural
people
Rural People Challenges Organizational Challenges

5. EMERGING BUSINESS
MODELS
Emerging
Trends
Primary
Healthcare
Tele-Medicine
Healthcare
Information
Systems
Hospitals on
Wheels
Secondary
Healthcare
Tele-Medicine
Telemedicine and BPOModel:
A new model which is emerging today is delivering healthcare
with the help of information technology tools.
Companies have discovered a notion to provide doctor’s advice on
phone by using latest tele and video conferencing technologies.
Healthcare Information Management Systems:
This model also uses the ICT technologies to guide its users about
various good health practices.
It teaches its subscribers about the different steps they should take
which depend on the type of disease or health problem they
encounter.
Changing Times in RuralHealthcare
With the advent of time, there has been significant change in
the business models practiced in
rural healthcare and each type of healthcare is served by a
particular type of business – model
and format.
Traditional brick and mortar model can’t serve the
healthcare needs of rural people.
There is a need of sustainable and scalable business
models which can cater to this potential customer base.

6. CASE 1.1: APOLLO TELE-MEDICINE
Apollo Telemedicine is largest and oldest telemedicine
network in India founded by Apollo Hospitals in 1999.
Apollo Hospitals has two concurrent businesses in rural
healthcare and telemedicine, one is under the banner of Apollo
Telemedicine Network Foundation and other is Apollo Reach
Hospitals.
The company was started way back in 1983 by visionary doctor
Dr. Prathap Reddy when private healthcare was not so popular in
India.
Challenges
•Changing the mindset of the people towards telemedicine.
•Winning the trust of the patients of rural areas.
•Standardize the protocol of interaction between doctors and
tele-medicine center.
Healthcare Delivery Model
The patients were advised from doctors from the distance varying
from 200 to 2800 Kms.
The technology had enabled the telemedicine centers to scan and
mail the X-Ray’s and other medical
The details of the patients were transferred to be multi-specialty
hospital by using desktop software.
Apollo Telemedicine NetworkingFoundation
First project of Telemedicine was implemented in the village of
Aragonda in state of Andhra Pradesh by building 50 beds
hospital connected to Apollo multi-specialty hospital of Chennai.
Video conferencing tools supplied by the Indian Space Research
Organization (ISRO) were used to make tele-medicine possible to
reach the villages of India.
One tele-consultation with the super specialized doctor is done at
price of US $ 11.2-16.7 and 50 US $ if overseas consultation is
being done.

7. Case 1.1: Apollo Telemedicine
ISRO
State
Governments
Medical
Equipment
Suppliers
Offering Primary and
Secondary Healthcare
services
Tele-Medicine
Affordable & Quality
health-care services in
Tier-2 cities and rural
areas
Managing customer
data online
Poor Patients
(Subsidized)
Rich Patients
Doctors
Para-Medical staff
Diagnostic Setup
Medicines
Fees for specialist tele consultation
Fees for Primary and Secondary
Healthcare Services
Medicines
Infrastructure (Hospital, Equipment, Staff)
Resources (Doctors, Paramedical staff)
Training, ICT Setup, Software
Video-conferencing
through tele-medicine
centers

8. CASE 1.1: APOLLO TELE-
MEDICINE
Social Costs
Tacking the cultural differences and creating
awareness
Social Benefits
Access to quality and affordable healthcare to all, expert
opinion to the patients
Organization Structure & Leadership
Centralized, Technology driven,multi-skilled
doctors and staff
Metrics
Number of specialists tele-consultations,
Average
time taken per patient, system downtime, Cost per
patient, quality of service, number of tests
Results
Today,ATNF has more than 150 tertiary hospitals which are connected to 35 specialty hospitals
across the globe.
Today,Apollo had done 69000 tele-consultations done by more than 100 tele-consultation
centers setup across the globe.
The Aragonda hospital has done more than 2000 consultations had been provided in the last
10 years from direct video interaction with specialist doctors.

9. CASE 1.2: APOLLO REACH HOSPITALS
Apollo Reach Hospitals
In 2008, Apollo started its initiative Apollo reach hospitals to deliver low cost quality healthcare in Tier-
2 cities, sub-urban and rural areas.
Apollo reach hospitals also extend the telemedicine network of the group which helped the people of
the villages to get the best advice at their reach.
Challenges
The Apollo reach hospitals faced the critical challenge of availability of the doctors as people don’t
want to work in smaller cities.
Innovation in Business Model
The Apollo reach hospitals targets both rich and poor patients in equable manner.
The revenue comes from the high income people and affordable healthcare was provided to the low
income people on the other side.
The health insurance covers RSBY hospital expenses up to Rs. 30,000 ($667) for a family of five
people.
The transportation costs were also covered up to a maximum of Rs. 1000 ($23) including Rs. 100
($2.23) per visit to the hospital or doctor.
Apollo had also signed a loan of 50 million dollars from International Finance Corporation to open up
more reach hospitals and telemedicine center in2010.

10. Case 1.1: Apollo Tele-Medicine
ISRO
State Governments
Medical Equipments
Suppliers
DiagnosticTests
Tele-Medicine
Consultation
Primary and
Secondary Healthcare
Affordable & Quality
health-care services in
Tier-2 cities and
rural areas
Primary & Secondary
Healthcare
Insurance Offer
(RSBY)
Poor Patients
(Subsidized)
Rich Patients
Doctors
Para-Medical staff
Diagnostic Setup
Face2Face Consultation
Video-Conferencing
Infrastructure (Hospital Setup, Equipmentetc)
Resources (Doctors, Paramedical staff)
Training, ICT Setup, Software
Primary and Secondary Healthcare
Money from Insurance
Medicines

11. CASE 1.2: APOLLO REACH
Social Costs
Publishing Papers to create the awareness
Social Benefits
Access to quality and affordable healthcare
Inclusion of poor people (paramedicalstaff)
Organization Structure & Leadership
Centralized, Technology driven,multi-skilled
doctors and staff
Metrics
Poor-Rich Patients Mix, Average time taken per
patient, system downtime, Cost per patient, quality
of service
Results
The inclusive business model of Apollo Hospitals had helped to reach sustainable
revenues
ranging from Rs 6000 ($132) to Rs. 7000 ($154) perbed.
It is estimated that more than 1, 00,000 patients who earn less than 2$ per day had been served
from Apollo reachhospitals.
The group aims to open 15 more hospitals and serve more than 400,000 patients by 2015. The
group also aims at opening 1000 telemedicine centers by the end of2012.

12. CASE 2: E-HEALTH POINT SERVICES
Healthcare Delivery Model
Tele-medicine consultation was done by HIS urban health
center where doctors give their advice and diagnose by video-
conferencing tools.
Doctors were recruitment from local areas so that there are no
linguistic disadvantages and they are especially trained to for
providing tele-consultations.
EPH also has the facility of performing near 70 tests and
equipped with devices like digital stethoscope, blood pressure
monitoring machine and ECG.
The average cost of each medical test was just$1.
E-Health Point services is owned by HealthPoint Services India (HIS)
started its operations in 2009 in partnership in Ashoka Foundation and
Naandi Foundation in the state of Punjab.
Three projects were started simultaneously at different places by
providing the services of tele-medicine, diagnostic services, pharmacy
and clean drinking water supply to around 10000 people.
In 2011, E-Health Points (EPHs) are operational with more than 80 EPH
centers spreading over seven districts of Punjab.
Innovation in Business Model
The services were offered with a nominal fees of less than 1$ mostly to
make it affordable for rural households.
The subscription was given at a very nominal fees of 1.5$ per month and
gives 20 liters of clean drinking water daily which has helped in
decreasing the water-borne diseases in rural areas.
The medicines were given to patients by licensed pharmacy available at
EPH and are sold at a discount of up to 50% on the listed prices and
directly procured from channel partners of the companies to get the cost
advantage.

13. Case 2: E-Health point Services
Ashoka
Foundation
Naandi
Foundation
Government
of Punjab
Pharmacy
Tele-Medicine
Consultation
Providing Clean Water
Affordable & Quality
health-care services in
rural areas
Primary Healthcare
Clean Water
Poor Patients
Rich Patients
Doctors
Video-conferencing
Setup
Center Staff
Video-Conferencing
EPH Centers
Infrastructure (Tele-medicine center, Equipmentetc)
Resources (Doctors, Staff)
Training, ICT Setup, Software
Tele-medicine Fees, Medicine revenues and Clean
water subscription

14. CASE 2: E-HEALTH POINT SERVICES
Social Costs
Organizing awareness and information sessions
Social Benefits
Access to quality and affordable healthcare to thepoor
Organization Structure & Leadership
Collaborative, Inclusive, Technology driven
Metrics
Number of Patients, Average time taken per
patient, system downtime, Medicine sales and
water subscription, service quality
Results
EHP has done about 29000 tele consultations, 15000 diagnoses and 35000 prescriptions have
been given since its inception to September, 2011.T
he impact and wider reach of EHP at bottom of the pyramid can be understood by theway that
it has around 3,50,000 daily users of clean water in ruralareas.

15. CASE 3: PIRAMAL E-SWASTHYA
Piramal E-Swasthya was started in 2008 as a social healthcare
initiative of well established pharmaceutical company Piramal
Healthcare in collaboration with Dean Nitin Nohria of Harvard Business
School.
Innovation in the BusinessModel
E-Swasthya doesn’t charge any consultation fee from the patients, they
just charge the expense of the medicines.
The medicines were made available to the health workers for selling to
the patients to generate instant revenues.
The marketing was done in a very effective manner to engage the rural
people and BoP households through regular messages, drug remainders
and publication of articles on telemedicine.
Challenges
The patients are not ready to buy all medicines as prescribed or just
don’t complete the full course of medicine.
Recruit the motivated health workers which can take the model to the
next level.
To address this challenge, E-Swasthya has launched pilot project with
Government of Rajasthan to recruit ASHA (Female Government Health
workers).
Healthcare Delivery Model
• Patient comes to the Piramal Swasthya
Sahayaka (Health Worker) for treatment
• Health Worker tell the symptom to the call
center executive
• Call center executive feeds the symptoms
as input into clinical decision support
system
• Clinical Decision Support displays the
recommended prescription based on
various algorithms
• Doctor validates the prescription and if
required talk to the patient

16. Case 3: Piramal E-Swasthya
Government of
Rajasthan
Tata Consultancy
Services
Vision Spring
Aquatabs
Pharmacy
Tele-Medicine
Selling Water
purification tablets
and
reading glasses
Affordable & Quality
health-care services
in rural areas
Primary Healthcare
Health worker
Poor Patients
Rich Patients
Video-Conferencing
Health worker
Medicine revenuesInfrastructure (Call center)
Resources (Doctors, Call center Staff, Health
worker)
Training, ICT Setup, Clinical Support System
Doctors
Health workers
Call center
Clinical Support
Systems

17. CASE 3: PIRAMAL E-SWASTHYA
Social Costs
Awareness through publishing newspaper articles
Social Benefits
Access to quality and affordable healthcare to thepoor
Organization Structure & Leadership
Innovative Technology driven
Metrics
Number of Patients, Average time taken per
patient, system downtime, Medicine sales and,
service quality
Results
E-Swasthya has treated 40,000 patients through several pilot projects which were deployed .
E-Swasthya gets on an average 1.2 patients per health worker per day in 50 operational villages.
To cover all the costs including the operational, technological and personnel and make the model financial
sustainable in the long run, it is required to achieve 1.7 patients per health worker per day on an average
for 1000 villages. The figure is quite achievable as already many villages have witnessed more than 3
patients per health worker per day.

18. CONCLUSION
Tele-medicine has emerged as a sustainable business which can cater the healthcare needs of the rural
people and bottom of pyramid.
Tele-medicine is extremely helpful in primary and secondary healthcare, however more advancements
are required to replicate the model for tertiary healthcare in rural areas.
The use of information & communication has removed the distribution and geographical challenges in
delivering the primary and secondary healthcare in rural areas.
ICT has significantly reduced both the infrastructure and operating cost for delivering the quality
healthcare services to rural areas.
Tele-medicine has been used as market development tool by the companies to create a new market for
getting an expert doctor advice without meeting him in personal.
The emerging business models looks very promising but it’s very early to comment on their long term
scalability and sustainability. The next 2-3 years will actually show clearer picture of the future of tele-
medicine in India.
The treatment of the poor segment at cheap and affordable price is a huge social capital created by these
business models.
By giving treatment to the poor segment and people in rural areas, these business models are
contributing in the inclusive growth of India full filling the dream of “healthcare to all”.

19. RECOMMENDATIONS
Government hospitals should be converted into public private partnership models to make them more
profitable and effective in delivering the healthcare.
Companies need to make tele-medicine as their core activity rather than a side activity. They need to
offer full basket of healthcare services in order to make their business models more sustainable and
scalable.
There is also a need of more advanced healthcare information management system like Nokia health
tools. Healthcare information systems can play a crucial role in preventive healthcare and creating
the awareness about healthcare with the increasing penetration of mobile phones in rural India.
The government need to give adequate subsidies and tax benefits to the companies operating in rural
healthcare to make their business models more scalable which can enhance the reach of tele
medicine to different parts of thecountry.
It is very important that bigger companies should enter the market the tele-medicine and rural
healthcare industry to develop the market and make it more scalable and sustainable.