Healthcare Karthik R IIM Indore

8/14/2019 Healthcare Karthik R IIM Indore

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Ignite - Healthcare

“If we stop thinking of the poor as victims and start recognizing them as

value-conscious consumers, a whole new world of opportunity willopen up.”

-C.K. Prahlad

KARTHIK R



Premise

“When patients go to many of the primary health centers, they find no one there.Sometimes, when they find someone, they will be referred to private doctors.Also, the medical system in the public sector offers no diagnostics, even of basic illnesses like malaria or TB. Patients are usually told to go to private practitioners for testing. Sometimes the testing isn't very good and, in any case,the economic cost could be ruinous.” Amartya Senas told to The Hindu (Jan 2005)

The price of healthcare in Rural India is two to three times the price in the cities

Poor accessibility increases transportation costs

Lack of primary health care facilities leads to worsening of existing condition

and increases cost of treatment

Almost half the “doctors” in villages don’t even have a medical degree

Rural people are willing to pay if we can provide quality products/servicesand this includes healthcare



Hitherto: What has been

doneYeshasvini Health Insurance Scheme

A self funding micro health insurance scheme started by Dr. Devi Shetty in

Karnataka. Farmers pay a monthly premium of Rs 5 for coverage

Very successful scheme providing health insurance to over 2.2 Million farmersin Karnataka through a network of hospitals and government subsidy

Mobile Medics Healthcare

A venture by BITS Pilani Alumni which provided mobile clinics using vans invillages of Rajasthan

Challenges during implementation because of inability to integrate backwards to

include hospitals and higher end medical care and recruit doctors



A New SystemThe proposed system involves a combination of hitherto mentioned schemes and

applying it to the context of Indian Rural Health SystemA Primary Health Centre (PHC) will be setup, which is a small hospital equippedwith 4-6 beds and manned by a Medical Officer who will be on the payroll of theorganization. Such PHCs cater to around 8-10 villages.

The purpose of each PHC is to ensure medical coverage for all the villages under it.For this purpose, every PHC is served by 2-3 ambulances called Mobile Medical

Centers (MMCs)

An MMC visits every village at least once a week and sets up a clinic for that dayproviding medical attention to those who are a part of the scheme. Each MMC hasa qualified doctor. The doctors would either be volunteers from a network of NGOs

working on weekends or paid professionals for the organization.

In addition to visiting the villages once a week, the MMC can be used in

emergencies by dialing a hotline number. The MMC will then ferry the patient toits PHC

Every 8-10 PHCs are connected to a Specialty Health Centre (SHC), which arebasically Private hospitals with capacity of over 30 beds and special facilitiesincluding Surgeons, anesthetics, X-rays etc. These SHCs are not owned by theorganization unlike PHCs and MMCs. Instead these are a part of the network built

to provide specialized medical care in case of emergencies.



Proposed Model



Proposed Model

SPECIALITY HEALTH CENTRE(PRIVATE HOSPITAL)

PRIMARY HEALTH CENTRE

PRIMARY HEALTH CENTRE

MOBILE MEDICAL CENTREMOBILE MEDICAL CENTRE

VILLAGES

VILLAGES

VILLAGES

VILLAGES



Funding and Costs

Villagers pay an insurance premium each month, which varies between Rs 20 - Rs50 depending on the population of the village and the ability to pay.

The insurance guarantees medical expense coverage for the entire family includingconsultation, drugs and surgery

For families, a discount on the insurance premium can be given due to economies of

scale

The costs include

Buying vans for MMCs

Doctor’s salaries

Building of PHCs

Operational expenses and buying of equipment and drugs

To limit the costs from insurance claims from becoming exceptionally high and to pay

the Partner hospitals in case of very expensive treatments, a Reinsurance policy isadopted, where the organization is insured against unforeseen raise in claims.



FeasibilityFrom the Yeshasvini scheme, it was observed that of the 2.2 Million farmers only a fewthousand claimed the insurance. On an average, an operation costed Rs 10000

From the calculations shown we can conclude that every PHC can run profitably providedthe scale is achieved. That depends to a large extent on the implementation and quality ofhealthcare provided.

With a village of 500 people, the SHC which serves 100 villages can make profit of Rs 0.3Crores. (Assuming 3% claims)

The fixed costs of buying ambulances and building PHCs can be quickly recovered through

this estimate



Conclusion

A self funding healthcare scheme that addressesthe three problems plaguing the system of

healthcare in rural India

Accessibility

Affordability

Quality



If the misery of the poor be caused not by the

laws of nature, but by our institutions, great isour sin.

Charles Darwin

Healthcare Karthik R IIM Indore

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