Narayana Hrudayalaya, Bangalore
Total Page：16
File Type：pdf, Size：1020Kb
Asia • India Healthcare for All: Narayana Hrudayalaya, Bangalore Prepared by • Prabakar Kothandaraman & Sunita Mookerjee (India) Sector: Health Enterprise Class: Local SME Summary In a context of high healthcare costs and low accessibility to quality health care, Narayana Hrudayalaya (NH) was founded as a private enterprise to initiate a medical revolution. Based on the premise that any existing solution to treat cardiac illness was not affordable and therefore could not be defined as a solution, Dr. Devi Shetty founded Narayana Hrudayalaya (NH) in 2001 to provide quality cardiac healthcare to the masses. The term “Narayana Hrudayalaya” means “God’s Compassionate Home” in Sanskrit. NH’s approach towards providing affordable, quality healthcare for the poor is a combination of compassion, high- quality medical knowledge and skills, and an astute sense of making the business work for the poor. The Healthcare Situation in India Ajay Dhankar, Principal at McKinsey’s Asia-Pacific healthcare practice, recently noted, “No matter how you look at it, healthcare situation in India is hopeless.”1 Dhankar identified two key challenges: one, the majority, 80 percent, of those that paid for their own healthcare were poor people; and two, the government funding was mainly focused on secondary and tertiary2 healthcare and not on basic primary care where patients made first contact with the system. The following statistics point to an underserved healthcare market. India has less than one doctor per 1,000 people, compared to 2.56 doctors per 1,000 people in the United States and 1.05 in China;3 in terms of healthcare, India is far behind the rest of the world. It had 1.1 hospital beds per 1,000 people, a figure that was inferior to countries such as Thailand and China where the comparable statistic was 4.34. The situation was worse in rural areas where, in some cases, one doctor catered to almost 200,000 people. However, some measures of healthcare in the country have improved since the 1970s. The infant mortality rate, for example, decreased from 120 per 1,000 live births, in 1975, to 63 in 20025. However, India still had miles to go to bring healthcare infrastructure and services up to international standards. Of the 5.1 percent of the GDP that was spent on healthcare (including creating infrastructure, paying doctors’ salaries, maintaining hospitals and dispensing drugs) in India in 2002, only 20 1 “Taking India’s Pulse: The State of Healthcare.” 30 March 2005. Available at http://knowledge.wharton.upenn.edu/article.cfm;jsessionid=a830a655d0f448561485?articleid=1111&CFI D=14378119&CFTOKEN=72958985&jsessionid=a830a655d0f448561485 2 Primary care is at the lowest level where people make contact with the nearest physician or their family practitioner when they fall sick; secondary care includes diagnostics and treatment, and tertiary is specialized care-giving and was also typically found in teaching or research hospitals. 3 Konan, Prabhudev, “Opinion: The Healthcare tourism conundrum.” The Hindu. November 24, 2006 4 Onkar S. Kanwar, Ex-President FICCI (a Federation of Indian Companies) in a speech at a Global Healthcare Conference hosted by FICCI in New Delhi in January 2007 (Available at http://www.ficci.com/media-room/speeches-presentations/2007/jan07/WelcomePresident.pdf). 5 Source: Ministry of Health & Social Welfare and Registrar general of India (Available at http://indiabudget.nic.in/es2004-05/chapt2005/chap109.pdf) Case Study • Healthcare for All: Narayana Hrudayalaya, Bangalore 2 percent came from the government, which left the bulk of the spending in the hands of private individuals and employers. Of India’s 15,393 hospitals (the second highest number in the world), roughly 75 percent were private and 30 percent catered to secondary and tertiary care6. The need for skilled labor was also profound. Each year, 18,000 new doctors graduated from India’s 170 medical colleges (please see Appendix A for healthcare infrastructure), leaving a projected yearly gap of 45,000 doctors by 2012 and a total of 350,000 new nurses needed to support the doctors, excluding tertiary care, by 20157. A study by FICCI and Ernst & Young predicted that India needed to add over one million hospital beds by 20128. The situation of inadequate infrastructure, little available public healthcare and a growing gap of human capital to meet the country’s healthcare needs threatened to have an adverse effect on the poor, especially the 34 percent of the population that lived on less than one dollar a day9. PREVALENT CARDIAC ILLNESS In 2003, worldwide heart-related ailments accounted for 17.2 million deaths, about 29.2 percent of the total deaths. The incidence of cardiac disease in India was exceptionally high. Indians were particularly at a higher genetic risk of heart disease than other nationalities. They also consumed foods that were rich in saturated fats and tended to have a sedentary lifestyle. In addition, there were about 224,000 babies that were born every year with congenital heart disease. India needed about 2.4 million heart surgeries every year, while only 60,000 were being performed, as of 200410. The Indian sub-continent11 accounted for nearly 45 percent of the world’s incidence of coronary heart diseases, and it has been estimated that by 2010 the figure will reach 60 percent. Since the 1950s, while OECD countries experienced a decline in heart attack deaths, the figure steadily climbed from four percent to 11 percent of all the deaths during that period in India. Thus, Indians were three times more vulnerable to heart disease than the average European. The average age for an Indian to suffer a heart attack was 45 years as opposed to 65 years in the western world. One in four Indians suffered from a heart attack before they retired (usually 58 years) and half of these deaths from cardio vascular deceases occurred before their 70th birthday. Comparatively, the figure for the west was 22 percent. Despite these indicators, very few could afford a heart operation12. 6 Available at http://www.ita.doc.gov/td/health/india_indicators05.pdf 7Onkar S. Kanwar speech 8FICCI Presentation of the FICCI-Ernst & Young Report (2007): Opportunities in Healthcare: “Destination India” Available at http://www.ficci.com/media-room/speeches- presentations/2007/jan07/ExecutiveSummaryReport.pdf 9 UNDP Human Development Report, 2006 10 Viswanathan, Vidya (2005), “Heart Care for Everyone,” Civil Society, Vol. 3, No.3, December 11 The Indian sub-continent includes India, Bangladesh, Bhutan, Nepal, Pakistan and Sri Lanka 12 Hutchison, Jim, “King of Hearts,” Reader’s Digest, February 2004, pp.18 Case Study • Healthcare for All: Narayana Hrudayalaya, Bangalore 3 Background of Narayana Hrudayalaya Dr. Shetty, like many doctors of his era, went to England after graduating in 1982 from Kasturba Medical College in the coastal town of Mangalore in Karnataka, India. He worked at a hospital in Midlands, England and later at the Guys Hospital in London. But after a decade of experience abroad, he returned to India and founded the Asian Heart Foundation (AHF) in Calcutta in 1989 as a non-profit foundation focused on cardiac care. AHF initially helped set up hospital for other organizations. The first one was opened in 1989 by the B.M. Birla Heart Research Institute. In 1997, Dr. Shetty assisted in setting up the Manipal Heart Foundation’s hospital in Bangalore. Dr. Shetty’s AHF, in association with the West Bengal (an eastern Indian state) government, built a 150-bed cardiac facility in Calcutta that quickly became the largest cardiac hospital in eastern India. In 1999, AHF also built its own cardiac hospital called the Rabindranath Tagore International Institute of Cardiac Sciences (RTIICS) in Kolkata (formerly Calcutta). Dr. Shetty never had problems raising the funds to build the hospital. A stockbroker patient donated £72,000 (US$142,732) as working capital, while a private company, Tata Finance, provided soft loans for buying equipment. Another patient’s son, who had a construction company, offered to build a cardiac diagnostic laboratory, and the Armenian Church, impressed by Shetty’s venture, came forward with a pledge of US$1 million. “Believe it or not, it’s not difficult to arrange for funds when your cause is noble,” opined Shetty in an interview to the New Scientist magazine in 200213. While Dr. Shetty was in Calcutta working at RTIICS, he also served as Mother Teresa’s personal cardiac surgeon, and this association deeply inspired him to think deeply about how he could better serve the poor. In a letter he wrote to children on completing 4,000 pediatric surgeries, Shetty shared what the nun had told him at the ICU14 of the hospital where she was convalescing: “Now I know why you are here. To relieve the agony of children with heart disease. God sent you to this world to fix it.” Shetty wrote, “...[this is] perhaps the best compliment that I have ever received.” 15 Demand for cardiac surgeries in India was underserved. In 2003, it was estimated that there were only 55,000 open-heart surgeries that were performed in India per million people whereas the demand was upwards of 125,00016. The cost also remained high and varied from hospital to hospital, depending on the type of facility. The top-tier private hospitals typically charged anywhere from US$1,500 to $6,000 for an open-heart surgery. Some of the government hospitals, such as the All India Institute of Medical Sciences in Delhi (AIIMS), charged much less (US$1,200) but did not have adequate capacity to treat a large number of patients. In 2001, Dr. Shetty’s father-in-law Narayan Shetty, who owned a construction firm Shankaranarayana Constructions (SNC) that was celebrating its 50th anniversary, invited him to start a state-of-the-art cardiac hospital in Bangalore.