100 years after the first heart surgery less than 8% of the world’s population can afford it. If a solution is not affordable it is not a solution” says Dr.Devi Shetty, Chairman of Narayana Hrudayalaya. His thought to make cardiac surgery affordable and cater to the needs of those who are in the most need of it triggered the birth of Narayana Hrudayalaya. Dr.Devi shetty did his post graduate studies in cardiac surgery and worked at cardio thoracic surgery unit at Guy’s Hospital, London. He returned to India to work and serve the poor. His initial setups and work with other private hospitals didn’t give him the desired satisfaction and thus he ventured out to start a hospital of his own.
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With the support from his family owned business ‘Shankar Narayana Construction Company’, he started Narayana hrudayalaya a 250 bedded cardiac hospital in Bangalore city, India on 8th May 2001, with an initial investment of around Rs. 70 crore ($).The group has grown 25 to 30 per cent year on year.
The hospital/health care group was instituted and is run under the name of Narayana Hrudayalaya private limited incorporated on 19 July 2000 according to the norms of the companies act, 1956 of India. All its present possessions come under the same name.
In a decade of starting its operations the health care group has grown and expanded its services nationally and internationally. Today the company holds many hospitals and health care institutions under its name. Starting with a single cardiac hospital in Bangalore it has now branches in various cities of India and planning to open branches in Mexico City, Mexico and Cayman Islands, USA in the coming years. The rate of growth and expansion of the hospital to other parts of India has been phenomenal. Narayana hrudayalaya pioneered the Indian health care market with a vision towards high quality but low cost health care. It helped to fill in the gap left by the other private hospitals which catered to the few rich at the top of the pyramid with high costs for care and the government health care setup which struggled to provide basic medical services with only around 0.9% GDP (WHO) for over a billion people.
Even as its expansion strategy was mainly oriented at the prospects of delivering affordable health care to the lower and middle income sections of the society. In doing so Narayana Hrudayalaya followed a flexible policy to establish itself in other cities of India. It brought in the concept of Management agreements where in it started to acquire hospitals that could not run to capacity due to lack of funds and other resources or institutions/trusts that showed interest to participate in bringing affordable care to the people in their regions. Narayana Hrudayalaya leased the hospital and the existing infrastructure from such hospitals. The hospital was managed by Narayana Hrudayalaya according to their standard protocols but a monthly/annual payment was made as per the lease agreements. In some instances Narayana Hrudayalaya was invited by state governments by provision of land subsidies or in the forms of potential investments to open new hospitals. A huge spurge can also be seen in the expansions during and after financial year 2007-2008 due to external investments coming into the group. Biocon Pvt.Ltd, an Indian biotechnology company came forward to collaborate in building a specialty oncology hospital in Bangalore, India. In February 2008 Global investment banks American International Group Inc. (AIG) and JPMorgan have taken a 25% stake in the company for Rs 200 crore ($) each.
The hospital chain as of 2009 July has over 4,500 beds spread across India. It aims to expand to have 2,000 more beds in the coming year (2010).It is planning to expand its total bed capacity 7,000 beds in the next 18 months and to 10,000 beds in the coming three years in India. Its target is to hold around 25,000-30,000 beds across India in the next 5-6 years.
The following are its established institutes and some in the pipeline:
Narayana Health city, Bangalore, India:
Institute of cardiac sciences-1000 beds
Super specialty hospital-1500 beds(just started operations as of July 2009)
Kiran Mazumdar Shaw cancer center-1400 beds
Narayana Nethralaya eye hospital
Sparsh super specialty trauma center – 200 bedded, to be scaled to 500 beds
Thrombosis research institute – In collaboration with TRI, London
Asha dinesh institute for advanced surgeries
Rabindranath Tagore institute of cardiac sciences – 800 bedded super- specialty cardiac center, Kolkata, India
Narayana hrudayalaya- 600 bedded cardiac super-specialty hospital, Jamshedpur, India
Narayana Malla Reddy hospital Hyderabad, India – 500 bedded -started operations in October 2010, soon to be scaled to 5000 beds
Rotary Narayana Nethralaya, Kolkata – 100 bedded scaled to 350 beds by early 2010
Armenian church trauma center, Kolkata- 400 bedded
Manjulaben Mehta kidney hospital- 14 acre medical, nursing, paramedical campus at Narendrapur, Kolkata
Narayana SDM cardiac institute -Hubli, India
Narayana hrudayalaya MS Ramaiah, Bangalore
Narayana health city Ahmadabad – 37 acres campus to accommodate 5000 beds, medical, nursing, paramedical school, 1000 bedded cardiac hospital by 2010
Narayana hrudayalaya Jaipur under construction -1400 bedded heart hospital to start from October 2009
Narayana hrudayalaya buwaneshwer-100 bedded cardiac hospital in association with government of Orissa by 2010
Narayana hrudayalaya Siliguri- 1000 bedded super-specialty heart hospital by 2010 with Bengal government
Narayana hrudayalaya Mysore- 1000 bedded multi specialty expertise in cardiac care to be functional from early 2010
Narayana Hrudayalaya also plans to have a chain of dental clinics. It has already set up five clinics with 25 dental chairs in total in Bangalore city. These clinics will be manned by specialists and other staff from Narayana Hrudayalaya. The group is funding the project from its internal accruals.
Narayana Hrudayalaya’s business model is simple. It functions within its comprehensive vision to provide “Affordable quality health care to the masses world wide”.
In achieving this goal the main areas of concentration are to maintain a world class quality and expertise which will attract huge number of patients leading to optimize its operational costs and bring down the price of health care services in their hospital. It identifies that utilizing the resources efficiently and increasing productivity like in any other industry will definitely bring down the unit cost of the service and it can be priced at the lowest price possible. This ability not only provides the highest level of care but also leaves a provision to make health care possible for the poor Indians who are in need of treatment.
The hospital has used this unique model to transform itself into a tertiary care referral center for complex surgical and medical problems with its huge infrastructure facilities which are one stop solutions for the rich to the low and middle income families.
Based on the High volume low cost model, the management ensures large number of potential patients who are in need of quality health care treatments by different outreach programs, schemes, telemedicine consultations and special micro health insurance programs.
It has also kept its administration lean and effectively and motivates its human resources to provide best results for its patients. Recognizing shortage and need of human resources for health in developing countries like India, It has winged into health academics where it trains, conducts research in medical and paramedical, and allied sciences to produce and enrich itself with the best man power. With thousands of satisfied patients, it is now looking at venues to replicate the success of this model nationally and internationally.
Operations at Narayana Hrudayalaya, Bangalore:
As per the scope of the thesis it is intended to stick to description of procedures and operations management at the mother institution of Narayana Hrudayalaya at Bangalore, India.
Brief Background Narayana Hrudayalaya, Bangalore:
This was the first hospital which opened its doors in 2001 under the chain. It was a 250 bedded exclusively cardiac hospital. By 2004 Narayana already lived up to expectations and also the satisfaction of its patients. It increased its operations by adding another 250 beds and built a new cardiac hospital complex.
Now in 2009, it is a 1000 bedded world’s largest cardiac hospital. Its expert cardiology teams have performed more than 35 thousand cardiac surgeries and 50 thousand cardiac catheterization procedures. Currently the company’s two specialized heart hospitals, the one in Bangalore and the other in Kolkata perform around 10% of the heart surgeries done in India. In Bangalore alone infrastructure to perform 73 major heart surgeries in a day is present.
Narayana Hrudayalaya performs largest number of heart surgeries on children in the World attracting children from 30 countries. The postoperative pediatric cardiac surgical unit has 80 critical care beds to look after children who underwent heart operations and this is World’s largest Pediatric cardiac surgical Intensive Therapy Unit (ITU).
It is a specialized center for organ transplants in India and Asia’s first and only artificial heart transplant LVAD center. It also houses a homograft cardiac valve bank.
It has developed expertise in highly specialized procedures like pulmonary thrombo endarterectomy for pulmonary embolism, aneurysms of aorta, Dorr’s procedure for heart failure, Double switches for correction of transposition of great arteries, unifocalisation for pulmonary atresia, one stage correction for correction for new born babies with Swiss cheese VSD, Mitral valve repair in new born babies and infant, Ross’s procedure for aortic stenosis with narrow root, Coronary artery neo roofing procedure for diffused coronary artery disease, Disorders of aorta, Re-do sternotomy with Gigli saw.
Though it started out as a cardiac hospital, with the motto of “caring with compassion” this world’s largest heart hospital for children has transformed itself into a multi specialty setup offering the best medical services.
In view of better utilization of technology and medical personnel the hospital expanded its services in other health care departments making it a multi-specialty setup. Now the hospital caters to a varied range of patients and provides health care services in Pediatrics, Neurology, Gastroenterology, Nephrology, Solid organ Transplants, Bone marrow transplants, Nuclear medicine, Imaging and radiology, blood bank and laboratory services, Metabolic medicine, Medical genetics, urology, Reproductive medicine, Telemedicine, Yoga, Nutrition and dietetics, Diabetology, Otolaryngology, Dermatology, Pulmonology, Psychiatry, Physiotherapy, Stem cell related therapies.
In 2008, it also started the world’s largest, 1400 bedded cancer hospital by partnering with Kiran Mujamdar Shaw of Biocon limited a biotechnology company in India. It has a super specialty eye hospital which pioneers in complicated eye surgeries and performs about 500 cataract operations every day. Sparsh super specialty orthopedic and trauma center with 200 beds was also started in 2008 which is to be expended to 500 beds in future. As an academic center it has a Thrombosis research center with 30 scientists working on vaccine to prevent heart attacks in collaboration with TRI London.
Attracting large number of patients:
Narayana Hrudayalaya’s main aim is to bring health care services to everyone, as Dr.Shetty puts it “An equitable distribution of world class healthcare for the masses at an affordable cost”. It is based on the principle of high volumes drives costs down. So from the beginning it concentrated on ways to attract large number of patients. When it started, it was the only hospital which had the expertise to deal with pediatric cardiac care with such high cure rates in India and a world specialist in some expert cardiac procedures. Dr.Devi Shetty was the expert and his name drew many other specialists from all over the world to come and join hands with him to make his noble vision come true. This expertise attracted patients from all over the country to Narayana Hrudayalaya at Bangalore. Now the brand name Narayana Hrudayalaya and the expertise is enough to draw a large number of patients from all over the country and the world to the hospital for various surgical procedures.
The hospital also recognized that they should not only passively receive and treat patients but reach out to them in various ways. India being a vast and diverse country, illiterate and economically poor pockets living in many remote areas it was very difficult for patients to recognize the presence of the hospital and reach to it. Thus the hospital started its outreach services. They believed that community outreach programs would develop a sense of collaboration between the communities and the hospital and a good relation would contribute to a shared vision towards health. Narayana Hrudayalaya’s outreach programs were started and have created awareness at least in some parts of the country. These programs not only have improved the understanding of health among the population but also provided them with specialized care by experts in the field. The programs have reached remote places where there are no public health facilities or only provide basic health care if present.
Narayana Hrudayalaya Bangalore has provided care to 182981 out-patients and 23868 in-patients in 2008 alone (only those who visited the hospital, tele-consultations excluded). It has done 9040 cardiac catheterization procedures, 5318 coronary angiograms, and 1071 angioplasties in the same year which is way higher than any hospital compared in India or the world. Looking at the figures from 2003, the immense growth in numbers and procedures performed can be traced (Figure 1). They performed 128 permanent cardiac pacemaker implants which is their expertise and almost 10 times any other hospital in India can perform in a year. They are still going in the very direction to treat more with the increase of facilities and awareness among the population. As Dr. Shetty says “the need for Cardiac surgical treatments in India is around 2. 5 million per year, an enormous task to fulfill and all the hospitals as a whole are now perform just 80-100 thousand surgeries a year. The others perish over a period of time due to lack of access to care. So the need is immense just the way it is achieved is not concrete.
The following are such schemes and programs which ensure to attract potential patients to Narayana Hrudayalaya.
Out Reach camps:
This was one of the first programs started and has been the prime source of publicizing the expert quality present at Narayana Hrudayalaya in Karnataka. The hospital runs a well equipped mobile diagnostic and care van donated by the ‘Ashraya Hastha Trust’ of Mr. & Mrs. Dinesh of Infosys, which on every weekend visits rural areas of Karnataka. The planning and scheduling is done in collaboration with the local voluntary associations and organizations like the rotary club and youth clubs. These organizations also advertise the event and arrange for the patients to fully participate and take advantage of the diagnostic services provided. The staff evaluates the patients for any disorders and runs a few tests to provide medical advice on the same day. If the patients are found to have any major abnormalities, they are referred to the main hospital in Bangalore or its nearby branches. Such camps have already covered most parts of Karnataka State and also nearby states of south India.
Rajiv Gandhi Aarogya Yojana – Amethi
This program started in 2005 to promote rural primary health care in Amethi region (2.4 million in population) of Uttar Pradesh in North India. 16 primary clinics were established and in the past three years, the clinics have recorded 6, 78,219 patient visits (2008 reports). In a day almost 40 to 120patients take advantage of this system. In need of secondary and tertiary care treatments the patients are referred to Sanjay Gandhi memorial hospital in Amethi which is linked with Narayana Hrudayalaya though telemedicine network and specialist consultation is offered to the patients.
Yeshasvini Cooperative Farmers Health care scheme
Narayana hrudayalaya in association with the State Government of Karnataka created a concept of a farmer’s health scheme called ‘Yeshasvini’. It started on 14 November 2002 and bases itself on the collective power of the masses to provide for them, quality healthcare.
It is a micro health insurance scheme which was built upon already existing infrastructure of state co-operative societies of the farmers. The premium was just Rs 60($1.5) per year per person in the family which was very affordable for any Indian farmer. It offered surgical and medical services regardless of predisposing medical conditions which insurance companies usually consider in deciding the premiums.
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It started with two districts of the state but soon was spread to all the farmer’s co-operatives in the state. The government recognized the scheme’s acceptability and now 92 selected hospitals all over the state accept this scheme. Free outpatient consultation services, subsidized diagnostics and medicines and over 1600 surgical packages including all costs of hospital stay are provided for to the beneficiary for cashless treatment. With about 1.8 million farmer’s families enrolled, this scheme attracts maximum number of patients to Narayana Hrudayalaya. According to Harvard business review, in 2003-2004 out of total surgeries the hospital performed 12% were on patients coming through Yeshasvini. (Recent data about the hospital attendants through this scheme was not disclosed due to reasons of confidentiality)
Arogya Raksha Yojna:
This another scheme based on micro health insurance and it is a joint venture between Narayana Hrudayalaya and Biocon Foundation (an initiative of Biocon, a biotechnology company in India). It covers the residents of Anekal Taluk. (A province in state of Karnataka).A member enrolls by paying Rs 180 ($ 4.5) per annum per individual. There is also a provision to enroll under a family package of 4 or more where the total premium paid is Rs 120($3) per person per annum.
The scheme provides free outpatient services, diagnostic investigations and medicines at discounted rates, over 1600 listed surgeries done free of cost and Medical Treatment up to maximum of 3 days admission.
Under the same umbrella, the clinical program of providing affordable primary care services has clinics in Bangalore, Chikballapur, Bagalkot regions of Karnataka and is equipped with a doctor, pharmacy stocked with generic pharmaceuticals supplied at a subsidized price, a laboratory offering basic diagnostics at a discounted price. It also offers mobile medical services. Chikballapur clinic has a telemedicine center which provides the patients expert consultation with Narayana Hrudayalaya.
A similar micro health insurance scheme in the state of West Bengal is being started in the coming year which will cover the teaching community in the whole state.
Narayana Hrudayalaya has pioneered the art of delivering expert consultations through its telemedicine network all over the world. This has been phenomenal in expanding its services all over India and globally. The ability to attract huge number of patients has been fostered through this effort. A hospital in a region is usually connected to the nearest branch or the main hospital through telemedine network or the patient visits the telemedicine center in his surrounding area established in a school, post office, public health center or a small unit of Narayana Hrudayalaya. He/ she attends a general consultation free of cost with the expert aided through a doctor /technician present at the hospital. If he already has his diagnostic reports he provides them for a second opinion on his condition for expert advice. Any patient found to have genuine problem visists the branch or the main center to get treatments done.
Narayana Hrudayalaya was one of the first collaborators for introduction of telemedicine networks in health care in India. The Integrated Telemedicine Tele-health Project was the first and jointly sponsored by is Indian Space Research Organisation (ISRO), Asia Heart Foundation, Kolkata and Narayana Hrudayalaya in Bangalore. It started in 2001 and has been implemented in the remote and difficultly reachable areas of north eastern states of India. It also has been extended to the tribal belts of south Indian state of Karnataka and various parts of the world. Now this system covers 322 hospitals – 229 remote centers connected to specialty hospitals in major cities of India. Narayana hrudayalaya is one among them and provides its expert consultation services to the patients who in need of care reach its branch hospital or the main center.
Narayana Hrudayalaya also has initiated a project called ‘Hrudaya Post’ where in it has connected 25 district head post offices in the state of Karnataka. This service caters to all patients who would like to have a consultation for diagnosis or a second opinion. The patient can go the post office and hand in his reports, angiograms, ECG etc to the staff there. They then upload and send these reports to the main hospital in Bangalore where go through the reports and send their expert advice with in 24 hrs back to the post office from where the patient can collect the information. The services are charged around Rs.100-125 per consultation by the postal department paid by the patient.
Apart from this network, Narayana Hrudayalaya with Asia heart foundation runs the World’s largest Telemedicine network globally with over 800 centres. Internationally they have a network base with Malaysia, Tanzania, Burundi, Zambia and Bangladesh.
Another initiative which the hospital has been involved in is the PAN African-e- network an initiative of Ministry of External affairs, Government of India. Narayana Hrudayalaya is one among the 6 hospitals connected to 53 African nations through the network. The hospital has been connected to provide comprehensive health care and medical education program in the sub Saharan Africa region. It also connects the 53 cities in Africa to its network through which it provides its consultations and advice to the patients.
Through its wide range of telemedicine networks, its name for expert pediatric cardiac care, affordable cost, prefixed treatment package costs which enable patient to exactly know how much the whole treatment and travel costs; Narayana Hrudayalaya attracts patients from around 73 countries all over the world. The hospital through its international division facilitates the patient travel and post operative follow up care efficiently. It has a predetermined plan and flow of activities, like a care pathway through which the patient is driven along seamlessly without any disturbance aided through a personal coordinator per patient. The patient accompanied by a family member (if a child then both the parents) avails expert quality care at affordable prices and travel costs included in the package for almost quarter the price he pays in his own country or other developed country if the treatment procedure is available and done there. The package price is same as for the Indian patient with travel costs extra. Started in 2004 the international services have attracted around 15000 patients till 2008 and almost an average of 3000 patients a year. Special partnerships have been forged with the governments of Malaysia, some African countries and NGO’s to send patients after expert telemedicine consultations for treatments at the main hospital.
Attracting large number of patients to provide expert care was aimed at affordable pricing of its services. The hospital has taken care to price itself lowest possible when compared to global and Indian prices. It has segmented its services into two broad categories, paying and non paying patients. Paying patients are those who pay for themselves or come through one of the insurance schemes provided by the state or some NGO’s or micro health insurance plans. Non paying patients are those who cannot pay the costs for their treatment procedures, they are not turned down but provided with free treatment compensated by charitable fund existing wing of the hospital. As per the manager finance ‘the number of non-paying patients over the years has decreased due to emergence of many state/NGO provided health insurance schemes and now the charity wing spends only about Rs 3-4 crore a year on such patients.
The hospital further categorizes paying patients according to the hospitality treatment they would like to receive when they are in the hospital.
The cost and quality for the technical procedure and treatment are same except for the hospitality (or the hotel) services provided. The hospital cross subsidizes the money across these categories and still earns surplus to spend money for its outreach and telemedicine programs.
The department of finance declares its approximate hospital running expenditures as follows and confirms they try to make a profit of at least 7-10% every year.
Comparing prices with other hospitals:
Quality control mechanisms at Narayana Hrudayalaya have kept the hospital floating and aiding to the progress. The hospital since inception recognized quality management measures would not only maintain the reputation of the hospital but also help them device strategies to deliver medical services efficiently to their patients. These have been the most important functionalities to assure that the prices are kept low by cost optimization with quality and safe care to ensure the hospital’s vision for affordable care to the middle and low income families. They also strongly believe that such measures may add to initial investments but would later add to cost cutting measures in the long run.
Following their vision for “quality health care to the masses” the management instituted a comprehensive quality management policy covering total quality control and a continuous quality improvement program. The main objectives were to provide timely and holistic quality patient care by continuously upgrading knowledge and maintaining a good patient relationship.
The hospital has been accredited by National accreditation board for hospitals and health care providers in India which is instituted by quality council of India (QCI). The QCI is an autonomous body was set by the union government of India jointly with Confederation of Indian Industry (CII), The Associated Chambers of Commerce and Industry of India (ASSOCHAM) and Federation of Indian Chambers of Commerce and Industry (FICCI) in 1997.
The hospital has instituted a quality management department which takes care of the quality control and assurance, not a frequent phenomenon in other Indian hospitals. It has a program that covers all major functions needed to ensure quality care and monitoring of risk management to provide effective treatment outcomes to the patients. It identifies the key indicators to monitor the managerial structure, processes and outcomes. A system of data collection analysis and documentation, processes for corrective and preventive action are in place encompassing all the activities connected with patient care.
The quality improvement program is coordinated by a management representative and accreditation coordinator along with a quality improvement team comprising experienced executives and staff (multi-disciplinary committees consisting of experts drawn from various clinical and non clinical services) who help in implementation of the policy initiatives.
Trained internal auditors (experts from operations, clinical services, Operation Theater, Cardio pulmonary resuscitation (CPR) and critical care, emergency, laboratory and diagnostics, information management systems, nursing, bio medical engineering, hospital services, infection control, quality management team) conduct internal audits and check for effective implementation of the program assisted by quality improvement team.
Quality indicators used by the hospital are specific for the processes (clinical and business) involved and thereby are apt mechanisms to know and keep a check on the overall quality of the hospital.
Quality improvement indicators monitored in the hospital are broadly divided into four categories:
Indicators which are used to monitor the volume load of the hospital are in place due to large number of patients coming every day. These indicators help them to keep a check on various necessities needed by the patients and how they can plan their resources well.
Some indicators in this category are outpatient and inpatient attendance, Annual admissions, Yearly Patient trends, Number of procedures done in each department like no. of cardiac surgeries, Neurological, General, Invasive surgeries, Dialysis, bone marrow and organ transplants.
Laboratory data like number of tests performed in Hematology,
Biochemistry, Serology, Microbiology, Number of Echo examinations, X -rays, Computed Tomography, Magnetic Resonance Induction, Ultra -sono gram, Tread Mill Test, Holter, Perfusion -echocardiogram
Resource planning has been identified one of the most necessary indicators to know the quality of the institution as having the right people at the right place ensures patient safety, communication and patient satisfaction. Thus, staff and nursing patient ratios are monitored .They also recognize that different work areas need different staffing ratios like in the wards, critical care units with ventilated or stable patients.
Resource and infrastructure utilization indicators help the quality department to know how effectively they can use the resources present .Bed occupancy rate, Average length of stay in intensive care units, Average length of stay in hospital, Bed turnover rates, Equipment utilization for major procedures, Equipment down time for major equipment are all monitored.
Is also a key indicator which helps to determine the patient treatment outcomes and avoids wastage of resources and cost optimization. Infection rates like surgical site, Urinary tract hospital acquired infections, intravascular device related infections, respiratory infections are all charted and their causes are enquired into.
The quality department also ensures a plan for every department so that the following key indicators are known, and their causes determined.
Parameters indicating the quality have been instituted and followed up. (The details and data for each of these parameters are not provided here due to reasons of confidentiality)
Narayana hrudayalaya identifies that health care is a knowledge intensive industry and its main force of sustainability is labor and their knowledge which needs to be replenished and sharpened to cater to the ever changing medical environment.
Thus the human resource department has aligned itself with the principle vision for sustaining the model with competent staff. The process of maintaining the reputation of such highly expert professionals in whom patients tr
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