Paradox of Primary Healthcare Business: Water, Water Everywhere But no Water to Drink!

February 16, 2016

 

A healthcare segment, which has a market share of 60%, worth US $60 Bn and handful of organisations focusing on, must present a great opportunity, right? A typical “Blue Ocean strategy”. Still people ventured in are gasping for sustaining their business.

So, what’s wrong? Is data incorrect, our service offering is wrong or the way we structured our offerings is wrong?

Is our data misrepresented?

Rest assured it’s correct. Even our own assessment has revealed that overall spend by a family on primary healthcare is more than secondary and tertiary care put together, over a life span. 

Is our service offering wrong?

Not really, to be honest, people have done some justice in organizing themselves in offering a bouquet of services, however, there is still room to innovate as where to draw the line between Preventive, Primary and secondary is ambiguous. But in a way, that is also an opportunity. 

Is our business ethos misaligned?

Definitely, A Big Yes. We say this with reasonable confidence that people currently venturing into the business have not oriented the services to cater to the real need. After interacting with most of the players, it’s disheartening to learn that they are still thinking on lines of typical hospital settings and best what they could do is to ideate and create a business unit, which is tailor down version of hospitals. They still talk of “How many centers we should have”, “What should be the ideal size of premise”, “What would be ideal consulting room size” etc. In most of the cases, the physicians selected to do the job, is also a super specialist brought to deliver primary care.

So, the big question is, can we really have profitable primary care business in India? Yes, definitely we can.

In our View, following criteria should help organizations to address the market need.

  1. It’s an unorganised business: The word “Unorganised” has been the most common word floating in business communities, however understanding the real meaning and developing services around is a big challenge. What it actually means that your business model should be flexible enough to take care of various unstructured demands by the consumers. It will vary from customer to customer, place-to-place and time-to-time. It takes lots of learning to develop a product for unorganized market.

 

This is the reason, we predict that, there would be a #diagnostic company which would evolve to setup most successful primary care business in India, as the learning curve to create a business in an unorganized market has already been done by them.

  1. It’s an outward business model: Like other healthcare models, which are inward in nature i.e. people come to you to seek care. The business has to orient the services to reach out to the people. 

  1. Reinventing the wheel of Pricing model: The most critical part of the puzzle would be to evolve a new pricing method. Our current incident based pricing model, where you charge the patient almost on every visit and every test, which is equivalent of any typical hospital, is certainly not going to work. Outcome based pricing will the biggest challenge for our business leaders. The organizations have to move away from market based pricing method and develop their own cost based pricing. The day organizations are able to charge on outcomes, they would become market leaders. For example: can you charge a diabetic / pre-diabetic patient for managing its HBA1C within 4 – 7? And I am not saying to provide services at cheaper rates, but to link the pricing with an outcome, in fact there is opportunity to charge premium over others. And trust me, there are people who are attending to do this in primary care. 

  1. Business model to touch million lives: The business leaders have to move away from modular thinking of creating more centers to reach to profitability has to be radically changed to a model where they can reach to masses without being physically present.

  1. Allopathic system of medicine is not the only method, at least for primary care: The business of primary care should include all the systems of medicine and they should be able to support decision-making process of people in deciding the method. Over the period of time, other systems of medicines like homeopathy, ayurveda, naturopathy, Yoga, acupressure etc. have been able to revive their lost confidence and we believe, as far as primary healthcare is concerned, they are better methods to consider. However organizations will have to invest in making them more scientific and transparent. Their ability to understand the limitations of each system would actually be a game changing aspect of addressing primary care business.

  1. Let research be your back bone: In a way we have totally forgotten the need of research in medicine. It’s not only the job of pharma companies. We need a well-structured data support system to support our decision-making. We need India centric parameters. Even simple parameters like BP and Blood Sugar levels are taken from western countries and applied on Indian population. We need to understand what’s the nutritional value of our food items and how it’s impacting peoples’ health. An effective system will radically change the way we have been delivering healthcare services till now.

  1. Think beyond medicine: For an effective primary care system to function, we need to think beyond medicine. For matter of fact the success of primary care ventures would be determined by its ability to keep people away from medicine and hospitalization.

  1. Keep your organization lean, but not mean: the operating cost of primary care center by design has to be lean, as one should not expect huge profit margins from each patient. The format is typically a volume driven business, in which one can expect profits once the critical volumes have achieved. Of course you can not be mean in engaging with patient as the nature of the business is build on long term relationships with the families and trust over period of time.

  1. Inbuilt mechanism to provide next level of care: One of the very important parameter in building confidence of people is your organization’s ability to seamlessly guide a patient to next level of care incase it is required. People wont depend on you incase you are not loop to provide the more specialized care.

  1. Use of #Health Technology will be the Key: The use of technologies would be the key and we are not referring to just apps and web presence to reach out people. Apps and similar tools would just act as enablers, the business has invested in development of need based devices and similar aspects to increase their reach and deliver their services. Of course, effective use of mobile technology will bring lot of value to the business, however it needs to be planned from scratch and very specific to purpose.

 

Synapse Healthcare has developed business models to address these needgap in the market. We shall be happy to share and discuss with organisations/ people, who are contemplating to start a business in Primary Care.

This initiate is part of Synapse Healthcare Incubation center, where we will support organisations / people in building a successful business in primary care. 

To know more about Synapse Incubation Centre, follow the link

#Healthcare #IndianHealthcare #HealthcareBusinessideas #Primarycare #PrimaryHealthcare #Mobilehealthcare #mhealthcare #innovations #healthit #hit #ehr #digitalhealth #healthapps #mhsm

Please reload

Featured Posts

Five Unconventional Healthcare Business Ideas!

November 27, 2015

1/1
Please reload

Recent Posts
Please reload

Follow Us
  • LinkedIn Social Icon
  • Twitter Classic

© 1996-2020 Synapse Healthcare Consultants Pvt. Ltd