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About the author :Astha Gupta, M.Sc MHA PAHM (in.linkedin.com/in/asthagupta87/) - Astha is a Healthcare Business Consultant with Program Management Office of Care Hospitals Group, India. She has been focusing on Excellence in Healthcare Service Delivery and Healthcare IT since past 3 years.
Healthcare Business Strategy
Family Medicine Clinics in India: The Next Big Thing for Indian Healthcare ? Astha Gupta -Healthcare Business Consultant
Healthcare in India has fast moved away from general practice to super specialised medicine. As a consequence the erstwhile family physician who had detailed knowledge of his patient’s lifestyle, family history and clinical history has somewhere gotten lost. Family Medicine is a branch of medical sciences which aims to provide comprehensive and continuing healthcare for individuals of all ages and genders. A popular branch of practised medicine across the globe, it provides for the first line of treatment and preventive care. In India, very recent times have seen a resurgence of this concept with a few private players stepping into this arena. The next few sections highlight the potential for this stream of healthcare in India and the challenges associated with it. Family Medicine v/s Specialised Care
World Organization of Family Doctors defines the aim of family medicine to provide personal, comprehensive and continuing care for the individual in the context of the family and the community. While as is implicit from the word itself specialised medicine focuses on a particular part of the body (Cardiology deals with conditions of the Heart) or a super specialised medical condition (ocular oncology deals with cancers of the eye). The first focuses on coordinated preventive management of health and the latter on management of a particular condition post its manifestation.
The Potential for Family Medicine Healthcare in India continues to be funded out of pocket with private provisioning. This fact is substantiated by the recent WHO report which states that private sector contribution to the healthcare sector is approximately 75% of the total spending (WHO, World health statistics 2010). However, most of these private investments in healthcare are concentrated in urban areas with focus on specialised and tertiary care facilities. Going at the current rate Bed strength in urban areas is likely to increase to approx 3.8-4.2 bed per 1000 as per a study by Mckinsey-CII in 2012, well above the WHO guideline of 3.5 beds per 1000. On the other hand the potential for growth in comprehensive healthcare even in urban areas is still huge. Pan India models of holistic care catering to needs of both rural and urban populations are likely to produce a win-win scenario both for the society and the investors
Changing demographics is another major factor which will lead to rise in importance for primary care. There is a dual burden of disease that Indian population is likely to bear in the next couple of years. This implies that while the burden of communicable diseases would continue to be on the higher side, lifestyle disease like diabetes would see a sharp rise in both rural and urban populations.(WHO states that there are nearly 50 million diabetics in India). In addition to this, 60 percent of the Indian population is currently in the younger age bracket and is likely to increase the geriatric population from current 96 million to around 168 million by 2026 (Emerging Trends in Healthcare, KPMG, 2011). Hence preventive care and chronic disease management would gain importance both of which are the pillars of family medicine.
In addition to these set up cost is a major driver. Set up cost of a specialised hospital ranges between Rs 40 Lakh to Rs 50 Lakh per bed (Emerging Trends in Healthcare, KPMG, 2011), while an entire facility of family clinic can be established between Rs 1-2 crore depending upon the service mix and the location. The argument here could be that revenues earned out of each of the two are not comparable but when looked at from an EBITDA and overhead costs perspective small clinic set up seems far more profitable. (Average EBITDA Indian Hospitals - ~12-15% Picking Winners in the Private Hospital Market) Models of Family Clinics 1. Single Practitioner A decades old model followed within the Indian market, it typically involves a single physician catering to a small local population. Services provided may range from only consultation to limited pharmacy, basic diagnostics and small procedures like suturing. Word of mouth is the most commonly employed tool for marketing. Mainstreaming and expansion of this model is extremely difficult since it is largely person dependant.
2. Practice Association A step further from the above model, practice association models would involve a group of physicians coming together to provide healthcare. Though still at a single city level this models offers protection from financial burden of investment on a single entity, scope for larger expansion in comparison to single practitioner, greater bargaining power while negotiating for any form of tie-ups and better chance at marketing though the sheer number of individuals involved. Also since it involves more number of physicians, person dependency is a lot lesser.
3. Clinic as an arm of Corporate Hospital Groups This model involves establishment of clinics in the form a hub and spoke model with the tertiary care set up. In a strategic language this model has the potential to perfectly serve for backward and forward integration for hospital chains. Family clinics established as outreach arms of a large tertiary care hospital can serve as feeder for referrals and then provide post acute care as well. The crucial factor to success of this model however lies in coordination of care given between the two entities. Apollo group with 1500 clinics nationwide is a prominent example.
4. Chain of family clinics These are typically a number of clinics established under a single corporate entity providing uniform services of general consultation, pharmacy, basics diagnostics and minor procedures under a single roof. A number of players are already using this model, prominent names being Nationwide Primary care clinics, Bharat Clinics and Wellspring Healthcare. In order to provide holistic care tie-ups with tertiary care facilities could be an essential factor that these chains may need to look into. Challenges Though immensely promising, family medicine is not devoid of its share of challenges.
India produces nearly 42,000 MBBS doctors every year, but of these, only 8,000 to 10,000 take up general medical practice as a profession. In fact India has negligible seats for MD in Family Medicine. Very recently Diplomate National Board has introduced this course which has now started producing only 100 to 200 qualified family physicians a year. This number presents a very sorry figure in comparison to countries like UK where 50% of medical graduates opt for family medicine. Shortage of qualified family physicians is a serious challenge to establishing family clinics.
Outpatient healthcare in India is devoid of quality regulation mainly due to the lack of monitoring by any Government agency. This makes family medicine clinics a risky business due to lack of any guidelines for processes and functioning
Lack of regulation with regards to access of healthcare is another major challenge since there is no concept of primary care as first access. Free flowing availability of specialists especially in urban areas only makes the matters worse. Hence success of family clinics hugely depends on sensitization of the population towards primary care. Conclusion Family Medicine clinics have the potential to fill the gaps in provisioning of a comprehensive and well managed healthcare to Indian population. They can prove to be an extremely profitable line of business for current or new players. But it is yet an unrealized need of Indian society due to the absence of streamlined access to healthcare in private sector. Appropriate branding, extensive awareness programs, membership plans, innovative pricing strategies and organisational partnerships could hold the key to success of this model of healthcare delivery. References 1. Indian Healthcare, Mckinsey & Co, Dec 2012 2. Emerging Trends in Healthcare, KPMG, Feb 2011 3. New Horizons In Indian Healthare, The Parthenon Group 4. Healthcare, Indian Brand Equity Foundation, Mar 2013 5. E Article: Do you still have a Family Physician, DNA, Feb 2014 6. E Article: India is world's coronary, diabetic capital, says expert, NDTV, Nov 2013