Article: Forum needed to take sector out of its unorganized roots


Forum needed to take sector out of its unorganized roots

R. Basil, Executive President, Healthcare, Apollo Hospitals Group

A new trend visible in the industry is that more and more NRI doctors are returning to India and showing keenness to join established healthcare brands


To keep a balance between clinical excellence and revenue generation, the first methodology being adopted is to insulate doctors from carrying any targets


As a young and growing industry, health care faces talent shortage across levels. What is your opinion on the talent demand and supply situation in Healthcare? Which roles and levels are facing the biggest shortage? What is the industry doing to overcome them?
It is true that the healthcare industry is facing an acute shortage of manpower across all levels. India has only 1.5 beds per 1,000 people, which is much below the WHO norm of 3.3 beds per 1000 persons. And it is semi urban and rural India that largely bears the brunt of this inferior healthcare infrastructure. Even if we create the required infrastructure, we will not have adequate manpower to serve the nation.

Perhaps the most coveted professional education in India is in the field of Medicine. Yet ironically, India faces a severe shortfall in the healthcare infrastructure and human capacity – 100,000 beds requiring Rs.75,000 crore investments, 1.5 million doctors and 3 million nurses!

There are presently 284 medical colleges in India out of which 136 are private medical colleges and the remaining government medical colleges. At present, 23,000 students graduate from these medical colleges each year. Most of them enroll for post-graduation courses while some leave to study abroad. Indian students are still migrating to countries like China, South Africa, and West Indies to pursue their medical education. To devise a mechanism to reverse the brain drain is the need of the hour.

According to a report by McKinsey, India immediately needs 2 lakh doctors and 5 lakh nurses. An additional number of 6.5 lakh doctors are required to reach a ratio of 1.25 doctors per 1000 and an additional number of approximately 18.7 lakh nurses to reach a ratio of 2.6 nurses per 1000 population by 2020. The number of technologists, pharmacists, physiotherapists, paramedical staff and other healthcare workers needs to go up by 200% in the next 5 years. India needs 600 new medical colleges and 1,500 new nursing and paramedical colleges. The investment in hard infrastructure has the potential to set in motion tremendous growth of the healthcare sector. There is a clear need for Government’s involvement with favourable policies to promote medical education that will have a positive cascading effect in quality as well as quantity of available manpower.

What are the key challenges in the healthcare sector for the year 2010? How have these challenges evolved? What is your outlook for the future?
The key challenges in the healthcare sector continue to be in the areas of rising costs for material and manpower, affordability of treatments for patients, lack of health insurance awareness, lack of skilled clinical, nursing, administrative, paramedical and managerial staff, implementation of proper IT systems and processes that can support efficiency improvement, the increasing capital costs for land and medical equipment making new projects stretch their break-even period et al. Over a period of time, healthcare providers have started focusing on effective cost reduction methods by reducing material consumption levels, reducing average length of stay, measuring and improving people performance, utilization of machines and manpower training. Patient’s affordability to pay is still a concern in India, especially the rural India. Some of the new initiatives through Government aided insurance schemes are bringing in some solace to the under-privileged. The services under these schemes, when delivered through private hospitals have led to an increase in the customer satisfaction levels. While lack of adequate clinical specialists, nurses and paramedical staff continues to be a challenge, more and more hospitals are coming up every year and it is estimated that this year alone, approximately 15-20 new multi-specialty tertiary care hospitals are underway in the private sector with an investment of close to Rs.3,500 crore. It will be a real task to find adequate skilled manpower for these organizations. A new trend visible in the industry is that more and more NRI doctors are returning to India and showing keenness to join established healthcare brands.
In spite of all these challenges, the healthcare industry still behaves like an unorganized sector. There is no effective forum that has become powerful enough to lobby or convince the Government to transform its status into that of infrastructure. This is extremely important for the future of this sector. It still remains an area of concern that the Government of a nation with 1.2 billion people is still not thinking of giving its healthcare sector the nurturing grants that it deserves. The healthcare industry has clear potential to genuinely touch the nation’s entire population. Large scale revamping of policies are very important to encourage investments, promote insurance programs, reduce cost of capital and produce adequate skilled man power. Reaching out for the common man and making quality health care available at affordable cost through public – private partnership and in-built social responsibility through SPVs can also benefit the economically underprivileged.

When it comes to performance management, how do you ensure that doctors providing medical treatment balance between ensuring adequate level of treatment and revenue generation?
Providing medical treatment is not singularly a doctor’s responsibility, but a team effort that includes assisting doctors, nursing, paramedics, operations and other support staff. The quality of health care delivery is improving with the advent of technology, experienced Indian Doctors, and improved models of health care delivery whose outcomes are comparable across all competing hospitals. The operating indicators and financial indicators are the same for all. The differentiator is service excellence and ability to deliver value for money to the paying patient. With increased insurance penetration, the healthcare provider industry is poised to be a price taker than a price giver. In this context, it is pertinent to go beyond a mere consultant driven approach where the focus shifts from the patients they bring in and the revenue they generate to delivering superior service experience and value for money.
Further, there are clear measurements in the industry to review mortality and morbidity rates. There are benchmarks which are well established for measuring success rates of individual doctors. Clinical excellence standards are definitely being practiced by the best of the hospitals in India today. To keep a balance between clinical excellence and revenue generation, the first methodology being adopted is to insulate doctors from carrying any targets. The business targets are carried by Marketing Teams and Business Development teams whereas the Doctors focus on clinical excellence norms only.

Ensuring that patient awareness is continuously created by displaying “Patient Charter of Rights” in prominent locations (also many leading hospitals handover printed information brochures on patient rights to their clientele) has helped to empower the consumers of healthcare industry. An empowered customer can play a very effective role in balancing the level of treatment and revenue generation.

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Topics: C-Suite, Strategic HR

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