One forty million Indian households are expected to enter the middle class in the next decade and will drive a two-fold increase in healthcare consumption. The use of disease management tools could result in USD 8.5 billion in additional drug sales by 2024. The unique opportunity that the boom in digital health presents for the life sciences industry is now at an inflexion point.
Increase in disease burden
Forecasts by healthcare experts and service providers, India has a massive disease burden, and the rise in life expectancy has also led to an increase in chronic disease instances. Since the disease burden is increasing, it has become essential to increase healthcare expenditure accordingly. Home healthcare is all set to play a critical role in serving the rising demand. Further, our existing institutional healthcare services are already overburdened. Hence digital technology-based home healthcare providers are the best options for those without access to general health services.
Local innovations to drive growth
Further, the boom in digital health in India will steer the evolution of the life science industry and amplify its positive impact on the quality of care. Amongst internet consumers currently, 140 million individuals are healthcare browsers, while only 10 to 20 million are online buyers. Due to an increase in affordability, demand will outweigh supply, and local innovations will drive this growth.
Ayushman Bharat and healthcare
India’s national health protection scheme, Ayushman Bharat offers growing opportunities in affordable healthcare. It will benefit many of the healthcare providers affiliated to this scheme. Penetration of healthcare insurance has occurred almost across urban and rural India, witnessing an upward trajectory.
The digital health segment saw more than USD 500 million of venture capital investment in last 2 years. New digital models emerging across the healthcare and life sciences value chain will shift profit pools and patient behavior.
Does the widespread deceleration mean that growth will fall?
While we are witnessing an economic downturn, healthcare is one industry that is usually not as affected as the rest. Having said that, it does not mean that the industry is recession proof. It will eventually come down to the survival of the fittest and its opportunity for growth and impact. India is a wide nation and it would take time to implement any new policy. Many experts believe that banks are still not ready to lend and open up for the new ventures. PSU banks will take more time to release the funds for startups.
Challenges faced by healthcare service providers
Healthcare providers face a number of challenges like–up dating with advanced medical devices, qualified medical professionals, well equipped hospitals and clinics, rising cost of medical care and aging population trying desperately to fit in the complexity of future.
Here are a few things healthcare providers can do to reduce the healthcare cost for patients:
- Provide local price variations to patients, either by healthcare providers or insurers;
- Empower patients to choose high value plans according to their wallets;
- Reduce the number of medical tests for patients;
- Negotiate prescription drugs costs for consumers; and
- Investment in IT healthcare such as revenue cycle management software has proven to reduce the operational cost.
Post pandemic effect–An opportunity to reshape healthcare
The COVID-19 pandemic has massively disrupted our lives. Besides direct devastation of health, the epidemic and lockdown have had myriad indirect effects on environment, livelihoods, or supply chains. Indian healthcare has been increasingly privatized over the last few decades, with intense market competition. Unfortunately in our country the questionable practices have been under the media and public glare leading to a huge trust deficit.
During COVID-19 there is dramatic reduction in the numbers of patients seeking care. The planned, non urgent problem including procedures and surgeries are reduced considerably. This has caused collateral damage, with the condition of some patients worsening. Caesarean section and hysterectomy are reported to have gone down. Similarly the procedures such as coronary stent, knee replacements, or cosmetic surgeries are reduced. Routine admissions for observations or insurance claim have got curtailed. Strangely, even emergency medical cases have declined with decrease in cases of heart attacks or strokes reporting to the hospitals. There may be genuine reduction of number of these cases perhaps because of the unpolluted air, decreased work stress and home cooked food which has had a bigger impact on health than we assume.
In routine sometimes we may be over diagnosing and over treating certain emergencies. Looking to these questions and critically analyzing them may make future healthcare more beneficial to patients.
There are dangerous fallouts of the disruption as well. The breakdown of over burdened healthcare facilities, negative impact on the morale of healthcare workers, and collapse of private institution under financial strain are all real.
The medical fraternity in India has risen admirably to the challenges of COVID-19. The call of duty has led many to don corona virus warrior outfit and set aside the commerce for now. It has forced them to consider alternative paradigms. Public respect for the profession has also improved. If we can seize this chance to correct undesirable practices, it may help the return of trust in the doctor-patient relationship.
Post COVID challenges for hospitals and their solutions
Hospitals must begin implementing measures to reduce or defer costs with a view to reserve cash in hand.
In the context of consumables, supplier consolidation for better rates, and renegotiations of credit period for pharmacy and consumables.
- Changes should be made to doctor-engagement models of fixed salaries by moving doctors to revenue generation model;
- Other staff/employees, increments and pay is to be evaluated depending upon their performance;
- Renegotiation of rent rates;
- Vendor consolidation (for outsourced services such as housekeeping services, security services, kitchen services, etc);
- Deffered or staggered payments of annual maintenance cost; and
- Reduction in the advertisement and sales promotion costs.
When making decisions in 2020, for next two years or more, healthcare enterprises have to consider a range of healthcare challenges that emerge with new technology and change in the market practices. To thwart the challenges in healthcare, it is essential we map the requirements and preferences of our patients and based on that we create an implementation approach.