It's business, honey

The corporate healthcare segment may replicate the success of the Indian IT sector, say experts.

The corporatisation of the Indian hospital sector has begun in a big way. Well known corporates such as Escorts and Apollo are already in expansion mode.

With corporate chains expected to garner over 20 per cent of the advance healthcare business of urban India, even first generation players are lining up to enter the lucrative sector. Birla, Reliance and Paras are some of the names eyeing the hospital segment.

Existing players such as Apollo, Escorts, Fortis, Max, and Wockhardt are strengthening their presence through capacity expansions, greenfield projects and acquisitions of mid-sized and big hospitals. International hospital chains like Columbia Asia are also planning to enter the Indian healthcare business.

According to industry watchers, each corporate group is in the process of identifying its core strength in the hospital business, thereby creating niche areas of operations. The move is triggered by the growth in the GDP, emergence of health insurance and the expected growth in medical tourism.

"The growth of professional healthcare managers is an indication of this changing trend. The number of universities and institutions offering management courses in healthcare is increasing. The sudden growth of hospital chains will require qualified and trained human resources," says Vivek Shukla, a health consultant.

The entry of private players in health insurance, the possibility of India becoming a healthcare destination for patients from developed nations and innovative marketing models adopted by corporate hospitals are all contributing to the success, experts say.

The corporate healthcare segment may replicate the success of the Indian IT sector. The healthcare sector is getting more organised. Ten years from now, 30-40 per cent of tertiary healthcare delivery could come from the corporate sector, says Vishal Bali, CEO, Wockhardt Hospitals.

"India's strength today is its huge clinical acumen. It has developed into a quality healthcare destination. A replication of what we have done in IT is to happen in the healthcare sector, as the demand-supply gap in the organised healthcare segment is huge," adds Bali.

Health insurance could be a big driver of healthcare services in the country. Only 10 per cent of medicare is covered by health insurance today, and even there, 7 per cent is the penetration of private health insurers.

Corporates expect a huge shift in this share and the entire growth that comes from the health insurance segment is expected to benefit corporate hospitals.

SNIPPETS

Tour for health
The central government has estimated that the medical tourism market in India is worth over $300 million, with about 1,50,000 foreign patients coming in every year. The government expects this to grow into a $2 billion business by 2012.

The government recently initiated a worldwide campaign to showcase India as a destination for world-class medical treatment at immensely competitive costs, through brochures and promotional films.

The brochures, brought out in association with the Indian Health Care Foundation (IHCF) and the Confederation of Indian Industry (CII), highlights treatments offered by Indian hospitals across diverse specialties.

The government has also set up expert committees to chalk out plans and set criteria for accreditation of hospitals and related agencies. The accreditation norms, price banding for identified hospitals and specialised medical services along with a list of hospitals, have been prepared by the Indian Healthcare Federation, an NGO affiliated with CII.

A new category of visa "" Medical Visa "" has been introduced for foreign tourists visiting India for medical treatment. Guidelines for the accreditation of Ayurveda and Panchkarma centres have also been issued to ensure the required standard of services.

Big and growing
The report of the National Commission on Macroeconomics and Health (NCMH) estimates that the size of the private healthcare sector in India is worth Rs 69,000 crore.

The NCMH projects that the size would double to Rs 1,56,000 crore by 2012. The study estimates that the proportion of in-patient care will go up to 47 per cent, largely due to increasing lifestyle diseases such as cardiovascular disorders.

It also points out that hospitals in India would need an additional 7,50,000 beds, 5,20,000 doctors, and an overall investment of Rs 1,00,000-1,50,000 crore (of which 80 per cent has been projected as the share of the private sector) by 2012.