Bridging the trust deficitJune 11, 2019
The private sector healthcare delivery in India has been the bedrock of healthcare capability and capacity, particularly in the area of high-end secondary, tertiary and quaternary care. Multi-specialty, corporate hospital chains have been the flag bearers of capacity and capability growth in high-end care over the last decade or more, but they are currently struggling with the changing dynamics of healthcare business, which is rendering traditional business models suboptimal. While private sector promoters and investors see the changing dynamics characterised by increasing focus on affordability as an overbearing development, in my view, this was imminent, if not long overdue. The reason why this was possibly missed by the leaders and managers could be traced to the key tenets of their belief system. In essence, I have observed three, distinct tenets:
Relative affordability compared to international prices: This has been an overwhelming influence in the minds of leaders of the private healthcare industry in India and has been a real deterrent in facilitating the requisite focus on affordable care in India. I could never understand the rationale behind this belief, as it has very little practical relevance for the consumer or payor for whom the affordability is defined by the size of their own pocket not by what would have been the relative burden in a hypothetical situation of being in a foreign land. This has singularly contributed in catalysing a self-righteous attitude among healthcare managers and leaders, which manifested in the use of price increases as the key tool for realising commercial objectives, instead of focusing on efficiency and the evolution of an operating model that responds effectively to the consumer context.
Inordinate focus on experience: The quest to offer a differentiated experience from public healthcare facility is understandable, but in the course of time, this has stretched beyond a limit, which has not only resulted in higher capital and operations cost, but has given a perception of insensitivity to the large masses of population who were neither used to that kind of experience nor were seeking it, but had little or no option but to avail them in the absence of affordable and credible alternatives. In some ways, what is perhaps a welcome offering for a minuscule percentage of the population with the means is being perceived as vulgar compulsion by the masses. Barring some extreme exceptions, most of the time, the experience factors do not contribute as significantly to the overall cost of delivery when compared to the perception it creates of expenditure that the poor consumer perceives as an avoidable burden.
Making healthcare affordable is government’s responsibility, not ours: This tenet has a rational basis, without doubt, and it is also true that the government has failed miserably to offer a credible alternative through public health delivery systems or to facilitate a robust ecosystem for health education to ensure adequate supply of clinical talent, particularly at the specialist level. This has significantly contributed to the excessive use of private care as well as the high cost of private care. But the irony is that the private sector was happy until the government started taking responsibility for affordable care and is now unhappy when it is pursuing the same with great intensity. That’s where the private sector erred, in assuming that government ownership of affordable healthcare will come on its terms, with the government playing the role of the payor, and will help them expand their market without changing their character. In reality, government ownership will expand the market significantly, but can find its sustainability only by changing the economics significantly to match its fiscal capacity, given the large percentage of needy population (approximately 70 percent).
In conclusion, it is a fact that the vision of corporate healthcare chains (and even many of the trust hospitals whose commercial agenda seem no weaker than those of “for profit” healthcare enterprises) for their enterprise was not really in tandem with the needs of the vast majority of India’s population, even though they have played a stellar role in providing quality healthcare to multitudes of needy customers both rich and poor. However, it is equally true that government policies should target the good of the greatest population and hence it is imperative that private healthcare providers must not waste time in defending status quo, but put in all their managerial, financial and entrepreneurial might to redefine their vision for the future in a way that is in harmony with the needs of the larger chunks of the population as well as the policy direction. This will, in fact, go a long way in bridging the significant trust deficit that exists between private players and policymakers, leading to better mutual empathy, and consequently, more effective policies, principles and practices for the benefit of all.
The author has long-standing association with EY India but the views are strictly personal.