Patient-centric corporatization: Making the twain meet

-Dr. Anuja Joshi

First year, MHA (HO)
Tata Institute of Social Sciences

The last decade has been a revolutionary journey for healthcare in the Indian subcontinent, as it finally begins to take
centre stage after prolonged subordination and anticipation. The excitement is palpable amongst healthcare providers,
the government and other stakeholders alike, as Indian hospitals rise to stand up shoulder to shoulder with world class
healthcare providers. Driving this revolution is a wave of business restructuring - we know as Corporatization.

Some say that this is just a part of the metamorphosis most sectors undergo in a fast developing economy like India.
On a more critical note however, there may be more to it than meets the eye. The transformation seems well beyond
apparent swanky infrastructures and medical technology. The very perception of patients, doctors & hospitals is
changing at a pace that is startling most of those involved and affected by the same. There is a paradigm shift
occurring in the way healthcare will be delivered in the times to come. But again, should this be a matter of concern or
even thoughtful discussion?
It should indeed, because healthcare is no ordinary sector. It is the unlikely business of saving lives.

Where do we start?
We could start with understanding the evolution of Corporatization in healthcare.
Necessity was the most primary driver considering healthcare is an essential service in society. Given the enormity
and the diversity of the population of a country like India, this ‘necessity’ probably was soon a challenge for any
government to manage. As a result, what should ideally have been a social security measure provided by the State,
was opened to other organizations to provide as a service at a cost. It was at this juncture that healthcare was
transformed into a ‘sector’ subject to the formidable forces of the ‘market’.
Healthcare is probably the most input-intensive and outcome-sensitive industry. The new players, who started singly
or in small groups, were struggling at both ends- first, to arrange for inputs whether in terms of capital or
professionals and next to ensure favorable outcomes in terms of affordable and effective treatment. Rising
expectations and paying capacities of a burgeoning middle class, started creating a demand that called for
organizations, much larger and more organized than islands of private providers. Going back to the essential nature of
healthcare services, the scope for business per se is both tremendous and relatively immune to typical market
fluctuations. This was a huge business opportunity in waiting. Thus was the advent of a new breed of players in the
form of ‘corporations’ who promised a restructuring of the healthcare industry to world class standards.
Some of the other major influences were lessons from the west, especially the health systems of the United States of
America. State of the art hospitals, high paying jobs for healthcare professionals and the best medical technology in
the world were attractive ideals to aspire for.
Accreditation was another inspiration from the west. Simply put, it was aimed to building and ideally running
hospitals at a benchmarked uniform international standard. Getting accreditation automatically offers the credibility of
maintaining international standards for either the department or the hospital as a whole.

Impact of corporatization
Initially, corporatization translated into well planned investments; quality infrastructure and creating a ‘brand’ image
for the hospital. One of the first and key steps to sustain such a venture was finding a pool of multiple investors for the
capital and ensuring returns on this investment, through pricing. Having had some success with this, the next step was
scaling up in terms of volumes, to generate generous margins and cut running costs. What started with large single
hospitals was now developing into a chain of corporate hospitals spread over major cities in the country.
These new hospitals also embraced quality infrastructure effectively. Infact, the interiors of most newly built hospitals
could give some of the best hotels a run for their money! Specially formulated healing environments for inpatient
departments, a flurry of well trained attendants and great food were just some of the creature comforts for those who
could afford them.
Setting standard operating protocols was the other cornerstone of corporatization. Meant to streamline the working of
the organization as per evidence based standards, they also assist newer professionals to learn the right way to do
things rather than rely on trial and error.
Ownership in the meantime shifted to the hands of a separate board of management who were not necessarily doctors
but trained in hospital management or business administration. Everyone else became an employee, including all
medical professionals who would be bound by the policy guidelines of the hospital. The hospital was now bigger than
any of its employees.

The other side of the story

At the receiving end of this transition, were patients with mixed reactions to the situation. Many of those who could
easily afford it initially patronized these hospitals for the promised quality on offer. The market however, did not
remain monopolistic for long, and competition was quick to set in. This competition unlike in other sectors however,
did not lead to fall in prices. Not very adept at dealing with competition, hospitals resorted to adhoc marketing and
newer service attractions, without analyzing their potentials leading to a paradoxical increase in prices for the end
users. Very soon, the cost of corporate healthcare spiraled out of reach for the middle class. .
The relative subordination of doctors in these hospitals, led to two groups: clinical and administration, both striving to
ensure their importance and decision making capacities. One of the probable options sought was defensive medicine,
at the cost of the patient who had little choice but to agree. Fewer patients meant tighter competition and malpractices
began to creep in the system. The hospital/patient-doctor bond translated into a legal customer-provider contract with
patients dragging the once demigod doctors to courts!

In the backdrop of the situation so far, it seems apparent that the gap between healthcare providers and patients is
widening at an alarming rate, and needs to be bridged before the damage is irreversible.
The point to note here, is that corporatization like globalization, is an evolutionary phenomenon that is bound to have
favorable and unfavorable repercussions. The catch lies in maximizing the favorable outcomes and dealing with the
unfavorable ones to minimize damage.

Hence the need for making the twain meet, the only way being a patient-centric approach to corporatization.

Patient-centric: Ethical, Intelligent and Affordable corporatization in that order

Ethical
The raison d’etre for healthcare is the patient and at stake is the patient’s life. There cannot be any hospital that could
justify malpractices of any magnitude under the pretext of rising costs, evidence based medicine or just blatant
commercialism. Unless the hospital commits to ethical practices irrespective of the challenges involved, there is no
way it can even attempt to regain the patient’s trust, leave apart loyalty.
It is also important to remember that affordability is not a trade off for ethics. The human life cannot be equated with
the pay potential of the patient, and acts of both omission and commission count for unethical practices.

Intelligent
The first important aspect of intelligent planning is comprehending ‘quality’. As discussed before, quality is often
relative, and customizing quality to the user is the key. There are certainly places where quality may be absolute like
in case of infection control, but interiors can certainly be experimented with. Sky lit domes, well maintained internal
gardens/ potted plants and children’s paintings can be brilliant alternatives to typical expensive interior options. The
focus must remain on cutting/minimizing all avoidable input costs without compromising on the outcomes.
 The second important aspect is a SWOT analysis of India as a market. We are a nation of volumes and
variations. Any hospital model must aim to reduce costs through large volumes. These numbers may however not be
easy to achieve in urban areas, simply because they are already saturated and land is dear. The idea then is to use the
variation. The tier 3 and 4 cities are growing faster than we can comprehend back home in our cities. Instead of
fighting over a contracting size of the pie in these urban areas, it makes absolute sense to reach out to the growing
demands in the semi-urban and rural areas. It is also preferable to train local residents to work for these hospitals
rather than haggle with reluctant urban staff.

Affordable
The cost of quality healthcare is a rather interesting debate. That is because neither inputs nor outputs can be
compromised with. Given the fact that investors would obviously be looking for returns, it is worthwhile making them
understand why it takes time to make money in healthcare. Returns are slow, but usually certain, unless expectations
are unrealistic.
An option here would be staggering and sharing input costs over time. This can be feasible in volume based models in
semi-urban and rural setups. Diagnostic facilities, support services could be shared or efficiently outsourced in the
local areas at very affordable rates. Other overheads like administrative costs, electricity and staffing could be kept at
minimum possible with effective technology like HMIS, telemedicine and green hospital infrastructures.

Public private partnerships

Considering the major players in the health market are private/corporate and public companies, the most logical
concept is the emerging trend for public-private partnerships, PPP in India. PPP, as Kent Buse and Gill Walt explain
is a collaborative relationship which transcends national borders to involve at least 3 players, out of which one is a
corporation (or industry) and the other, an inter-government organization to achieve a shared health-creating goal on
the basis of mutually agreed division of labor.
PPPs could be of various types, either owned by public sector involving private players like in GAVI, SIGN or RBM
programs, or have NGOs involve corporate participation like World heart federation. The local governments may
choose to tie up with key private providers like Government of Chhattisgarh with Apollo and Escorts hospitals for the
“Bal Hridaya suraksha yojana” for pediatric cardiac ailments or the Government of Gujarat, with IIM-A, FOGSI,
Sewa and private practicing gynecologists for the “Chiranjeevi yojana” to ensure safe deliveries.
Keeping in mind the promises PPPs offer to make, a word of caution may nonetheless be exercised. The concept is
still emerging, and there isn’t yet substantial evidence to prove its capability in mass application, so a gradual, and
well calculated approach would be pertinent atleast initially. A formidable, responsible and transparent governance to
protect from exploitation, forging of figures, and to ensure that public interest is preserved throughout as the target of
all activities.

At a closing note, the relevance of the patient-centric approach deserves a reiteration. All of the
options discussed above, are expansions of this very basic ideology. Whatever happens in healthcare must
protect and benefit the patient before anyone else, because he is the most vulnerable of all stakeholders
involved. The most reliable question for any decision-making in healthcare is whether it benefits the patient.
If it does not benefit the patient, don’t do it because it won’t benefit anyone else in the long run either!