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Healthcare

in India

BY:
DHEERAJ SRINATH
DON PHILIPS
BHAGAVANTRARAYA

Brief Overview

The Healthcare Sector comprises of

Hospitals
Diagnostics
Pathology
Equipment and Supplies
Medical Tourism
Telemedicine, etc

It is one the prominent contributors to Indias GDP.


It attracts large number of domestic as well as international players
India has become an attractive destination for
Medical Tourism
Clinical Studies
Research and Development Programs

There is massive growth potential and scope for expansion

copyright (your organization) 2003

4/14/15

HealthCare : Market Size

The HealthCare Industry is presently worth USD90.4 billion


Second largest service sector employer in the country.
Provides jobs for 4.5mn people directly or indirectly.
Per Capita Healthcare Expenditure USD61
Healthcare Expenditure ~15%
Health Insurance Penetration ~15%
Government share in total healthcare expenditure 33.1%
Hospital Share in Total Healthcare Expenditure 71%
Hospital Beds Per Thousand Population 0.9
Physicians Per Thousand Population 0.7

Healthcare

Hospitals
Government
Hospitals
-Governmentowned facilities
such as
healthcare
centers, district
hospitals, and
general
hospitals

Pharmaceuticals

Private
Hospitals
Establishments
such as
nursing homes,
mid-tier and
top-tier private
hospitals

Formulations
-Manufacturing
of final
medicines
directly sold to
end consumers
API/ Bulk Drugs
-Manufacturing
of chemicals
and materials
used in the
production of
medicines

Medical
Equipment
-Includes
establishments
primarily
engaged in
manufacturing
medical
equipment and
supplies, such as
surgical, dental,
laboratory
instruments, etc

Diagnostics
-Comprises
businesses and
laboratories that
offer analytical
or diagnostic
services,
including body
fluid/blood
analysis

Medical
Insurance
-Covers an
individuals
hospitalization
expenses and
medical care
bills incurred
due to illness

Indian HealthCare : Growth Story

A sudden in paradigm shift in the last five years.


This shift has become visible only in the last two years.
A shift from an unorganized to an organized structure.
It was earlier seen only as a social sector but now there
is a move towards corporatization.
Apollo pioneered the trend of corporate hospitals in
India.

Factors for the HealthCare boom in India

Strong Indian Economy


Increasing options for Healthcare Financing
Increasing Opportunities in Healthcare delivery

Better Profitability (15-20% EBIDTA)


Earlier Break Even (2-3 years)
Medical Tourism
Increasing demand from within the county

Top Health Care Companies and Hospital


Chains
APOLLO LIFE
SUN HEALTHCARE
NICHOLAS PIRAMAL INDIA PVT. LTD
WIPRO GE HEALTHCARE
SERUM INSTITUTE OF INDIA LTD
CIPLA
CADILLA HEALTHCARE
RANBAXY
FORTIS HEALTHCARE

Emerging & Re-Emerging Diseases

Pneumonia - The deadliest Acute respiratory infections


(ARIs) are responsible for most deaths in the developing
nations.
HIV/AIDS - Over 33 million people are living with
HIV/AIDS worldwide. There is still no cure on the
horizon. Worst affected is sub-Saharan Africa

Emerging & Re-Emerging Diseases(contd)

Diarrhea - It imposes a heavy burden on


developing countries - accounting for 1.5 billion
bouts of illness a year in children under five. The
burden is highest in deprived areas where there is
poor sanitation, inadequate hygiene and unsafe
drinking water.
Tuberculosis (TB) - a disease once thought to be
under control, has bounced back with a vengeance
to kill 1.5 million people a year - even more when
in combination with HIV/AIDS. Nearly two billion
people - one-third of the world's population - have
latent TB infection

Emerging & Re-Emerging Diseases(contd)

Influenza - It is a greatly misunderstood disease.


Each year we confront seasonal, or interpandemic
influenza. Seasonal influenza kills about 250,000 to
300,000 people each year throughout the world

Measles - It is the most contagious disease known


to man. It is a major childhood killer in developing
countries - accounting for about 900 000 deaths a
year

Emerging & Re-Emerging


Diseases(contd)
SARS
Nearly three years ago, the world experienced another newly
emerging microbea previously unknown corona virusthat
caused severe acute respiratory syndrome (SARS).
The SARS outbreak turned out to be a classic study in
epidemiology with regard to tracking the point source, the spread,
and the containment. SARS first appeared in Guangdong Province
in China. I
t was not reported to authorities until it emerged in Hong Kong,
when an index case, which traveled from Guangdong to Hong
Kong, stayed at the Metropole hotel and infected at least 14
people.
Those individuals did some traveling throughout the world. Within
months we had an epidemic that temporarily transfixed the world
and did extraordinary economic damage in Canada, China, and
Hong Kong, and other countries. There were 8,098 reported cases
and 774 deaths.

Indian Healthcare Infrastructure

As on December 2010, there were 335 medical colleges


which were recognized by the Indian Medical Council.
As on 2001, a total of 5, 39, 00 MBBS doctors were
registered with the Medical council number of
Physicians and specialists available is less than the
estimated requirements.
The current doctor population ratio is 1:1800.
Though at present approximately 50000 doctors are
being produced annually in the nation, but the number
needs to go up.

Indian Healthcare Infrastructure(contd)

By 2020, the Indian healthcare industry is estimated


to be worth US$ 275.6 billion.
Currently, 8 per cent of Indias GDP is spent on
healthcare. India needs to spend at least US$ 80
billion more in the next five years to meet targets.

Indian Healthcare Infrastructure

51% of the surveyed population believes that there is


considerable difference between performances of
hospitals in their region.
39% of the population believes that quality of govt.
hospitals is bad and 35% of population believes that the
quality is just an average. 18% believes that the quality
of the govt. hospitals is very bad. Only 8% believes that
quality of govt. hospitals are good.

Indian Healthcare Infrastructure

57% of the population believes that quality of


private hospitals is good and 22% of population
believes that the quality is just an average. 21%
believes that the quality of the private hospitals is
very good.

83% of the population is of the opinion that cost


of private hospital is quite expensive.

DELIVERY OF SERVICES

The place of delivery may be

Home
Community
Workplace
At Health Facilities.

The most common way is face-to-face delivery, where care


provider and patient see each other 'in the flesh'.
Absentia health care is becoming more common.

Over The Phone


Video Conferencing
The Internet
Email
Text Messages, Or Any Other Form Of Non-face-to-face
Communication.

The Health Insurance


Market of India

Need of Health Insurance


Government Hospitals: Inadequate facilities

Expensive Medicines: Diagnostic charges are beyond


common mans reach.

High cost of Specialists.

Tax benefit under section 80 D of the Income Tax Act

Standard Health Insurance: Features


Room and boarding expenses provided by the hospital
Nursing expenses
Diagnostic and medicine expenses
Other Services: Surgeon, Anesthetist, Medical
Practitioner, Consultants, Specialist fees, Anesthesia,
blood, oxygen, operation theatre expenses, cost of
surgical appliances, medicines and drugs and similar
expenses.
Pre-hospitalization and post hospitalization expenses
subject to conditions and limits.

Companies Category
Non-Life Insurance:
Public: Companies like Oriental, National Insurance, United India,
etc.
Private: Companies like ICICI Lombard, Reliance, Bajaj Allianz, etc.
Specialized Health Insurance Companies:
Offers Core Health Insurance services & Products only.
Examples: Star Health & Allied Insurance, Apollo DKV Insurance
Life Insurance Companies:
Addresses following needs:
Saving
Pension
Retirement
Investment
Players are LIC and other private players

Market Segmentation

Working Class Individuals


Working Professionals with Family.
Students
Senior Citizens
Small and Medium Enterprises/ Corporate Houses:

Product Ranges
Individual Health Insurance Products (Single Person).
Family Health Insurance
Senior citizen Health Insurance
Individual Personal Accident
Overseas Travel Health Insurance
Group Health Insurance Policy for corporate /
Organization

MEDICAL
TOURISM

MEDICAL TOURISM

Medical tourism is the rapidly growing practice of traveling across


international borders to obtain health care.
Typically include elective procedures as well as complex specialized
surgeries such as joint replacement (knee/hip), cardiac surgery, dental
surgery, and cosmetic surgeries.
But very type of health care, including psychiatry, alternative
treatments, convalescent care and even burial services are available.
Over 50 countries have identified medical tourism as a national
industry.
Accreditation and other measures of quality vary widely across the
globe, and there are risks and ethical issues that make this method of
accessing medical care controversial.

ADVANTAGES OF INDIA

Quality and experience of doctors and surgeons

Most doctors and nurses are fluent in English

Latest medical equipments

Quality of nurses

Low cost

COMPETITION

Thailand, Singapore, Malaysia and Philippines are the


major competitors
Thailand is more popular for cosmetic surgery.
In complex procedures Singapore has a technology
advantage.
Cost in Thailand is also less than Singapore
The Malaysian government is aggressively promoting
medical tourism.

AYURVEDA

Total worth $1bn


Less than a dozen major players
Dabur India Ltd
Sri Baidyanath Ayurvedic Bhawan Ltd
Zandu Pharmaceuticals Works
The Himalaya Drug Company
Charak Pharmaceuticals
Vicco Laboratories
The Emami Group
Aimil Pharmaceuticals Ltd

STATUS OF AYURVEDA IN INDIA

Number of registered medical practitioners: 366,812


Number of dispensaries: 22,100
Number of hospitals: 2,189
Number of hospital beds: 33,145
Number of teaching institutions (undergraduate): 187
Number of upgraded postgraduate departments: 51
Number of specialties in postgraduate medical training: 16
Number of pharmacies manufacturing Ayurvedic medicines:
8,400

SURGICAL EQUIPMENTS

World market growing at a rate of 6% from 2010


Market is highly price sensitive.
Good network of distribution channels
Powered Instruments :- 47% of the total market
Non-Powered Surgical Instruments:- blades,
scissors etc
Wound Closure Devices:- staplers, wound
closure strips etc

Pharmaceuticals in India

TheIndianpharmaceutical industryis the world's second-largest by


volume.
India's bio-tech industry clocked a 17 percent growth with revenues of
Rs.137 billion ($3 billion) in the 2009-10 financial year .
Bio-Pharmaceutical was the biggest contributor generating 60 percent of
the industry's growth at Rs. 8,829/- crore, followed by bio-services at
Rs.2,639/- crore and bio-agri at Rs.1,936 crore.

Service Marketing 7 Ps

PRODUCT
Both intangible and tangible, seeking to satisfy the new
wants and demands of the consumer.
Service products of the hospitals normally have the
following features

Quality Level
Accessories
Packaging (Bundling) like offering full
Product line
Brand name

health checkup.

Service Marketing 7 Ps

PRICE
The government uses price controls to
ensure that vital drugs are affordable to
the Indian population. It is an ongoing
challenge to balance the commercial
interests with the broader social objective.

Service Marketing 7 Ps

PLACE
The number of public health facilities also is inadequate.
For instance, India needs 74,150 community health
centres per million population but has less than half
that number.
Telemedicinethe remote diagnosis, monitoring and
treatment of patients via videoconferencing or the
Internet. Telemedicine is a fast-emerging trend in India,
supported by exponential growth in the countrys
information and communications technology (ICT)
sector, and plummeting telecom costs.
Many
hospitals
have
developed
public-private
partnerships (PPPs), among them Apollo, AIIMS,
Narayana Hridayalaya, Aravind Hospitals and Sankara

Service Marketing 7 Ps

PROMOTION

Word-of-mouth plays an very important role in


promotion of hospitals.
Either advertisement or PR or sometimes both.
Print media like Newspapers, Magazines Journals and
Periodicals.

Hoardings and wall writings near the markets and


recreation centers.
CSR activities to create awareness among the people.
Ex. Aids awareness camp, Blood donation camps etc.

Service Marketing 7 Ps

PEOPLE

Internal customers of the hospitals which includes


doctors, nurses, supporting staff etc.
Patients

Service Marketing 7 Ps

PROCESS
Different tasks that are performed by the
hospital.
Communication within the setup.
Experts and specialists of different disciplines
Quick and healthy service under all situations
from the staff.

Admission

Diagnosi
s

Treatme
nt

Discharg
e

Followup

Service Marketing 7 Ps

PHYSICAL EVIDENCE
Physical evidence can be in the form of
smart buildings, logos, mascots etc.
Proper diagnosis and cure of the
problem.
Diagnostic equipment used in the
hospitals.