 "Private hospital segment to reach $125bn by 2017 : Assocham")
With a staggering 20% compounded annual growth rate (CAGR), the Indian private hospitals segment is estimated to reach a level of US$ 125 billion by 2017 from the present level of US$ 70 billion, said a recent study by the industry body Assocham.
The significant increase in tier II and III cities will drive both the growth and the size of this segment.
Releasing the study on “Healthcare in India” D S Rawat Secretary General Assocham said, rising income levels and exposure to international standards of quality have led an increasing demand for quality private healthcare.”
The study brought out by the two institutions have also projected that the Indian diagnostic and pathology services contribution to healthcare industry shall touch US$ 5.2 billion by 2017 as against US$ 2.5 billion during 2012-13.
The private sector accounts for 80% of India’s healthcare delivery market which is higher for India than in any other country in the world. Out of pocket spending by Indians constitutes 94% of total spend in the private health industry.
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Medical tourism industry is pegged at US$ 1 billion per annum, growing at around 18% and is expected to touch US$ 2 billion by 2015. Medical tourism is an important segment because it allows most hospitals to charge a premium of around 20-25% over what it does to local patients.
India attracts patients mostly from Africa, Gulf and SAARC nations, Pakistan, Bangladesh and Myanmar, who come mainly for organ transplant, treatment of orthopedic, cardiac and oncology problems, adds the study.
The private healthcare landscape is poised to be a key contributor to the healthcare industry. With substantial Private Equity investments in private hospital chains not only in urban cities but also in innovative rural models, we expect this large investor appetite to contribute significantly to the increase of private healthcare establishments, Rawat said.
Innovative infrastructure financing models will reduce incubation periods stimulating increased investor interest. Large corporations have also begun venturing into this highly lucrative business and we expect to see continuity in this trend.