Friday, April 27, 2012

Meet the Henry Ford of Heart Surgery, Dr Devi Shetty .. ..

Hands that serve are more sacred than the lips that pray - Mother Teresa
Much has been said and written of this great 58 year old young surgeon from Bangalore. There is a radiance emanating from his face which is so pure and sublime.

For long it has been said that Electronic City, Bangalore is just the headquarters of Infosys and houses some of the big names of the Fortune 500 companies of India and the world. More importantly, it has the biggest cardiac hospital in the country, if not in the world and also the  biggest 1500 bed cancer hospital in the country.

From an academic point of view, this is a write up on how process innovations can make a big difference than product innovations, especially in the healthcare service sector.

Meet the Henry Ford of Heart Surgery, Dr Devi Shetty of Narayana Hrudayalaya, Bangalore. Henry Ford brought mass production to the world with the Model T Ford car at the beginning of the 20 th century. Dr Devi Shetty is rewriting the history of cardiac surgeries by offering a case of the cardiac medical factory of the future here in Bangalore, offering cardiac surgeries at the lowest cost anywhere in the world, at quality better than the rest of the world .. Year after year, to the ire of his detractors, he continues to amaze the rest of the world with his simplicity and steadfast commitment to the cause of serving the medical field and the people of the world at large.

In 2011, they did almost 6600 heart surgeries,(highest in the world from a single facility) half on children (paediatric cases). It is the largest paediatric heart surgery hospital in the world. A heart surgery here costs just $ 1800 ( app INR 75,000), a fraction of what it costs elsewhere, app $40,000 - $100,000 for a complicated surgery.. Low-cost factory like innovation happening in the medical sector in India is sure to change the health scenario of the world in the coming years.

It is a service Factory .. Drive huge volumes and bring economies of scale .. They offer the best service in the world at a fraction of the cost to not only the rich, but also the needy in society, catering to the bottom of the pyramid ( as late Dr C K Prahlad used to address the 50 % of world population) who cannot afford costly surgeries but need help of modern medical science and surgery. A copy of an analysis of Dr Prahlad's BOP ( Bottom of Pyramid) theory in the Strategy and Business magazine.

Aravind Eye hospitals, Madurai does it with a missionary zeal, offering 90% of surgeries for free, while Narayana Hrudayalaya offers 5 % free.. Click for Arvind Hospital TED talk here ..

Even after doing all this good for society at cheap rates, Dr Shetty has reported profits of 7.7% after taxes, more than what US hospitals do at 6.9%. There is a big businessman also hiding in Dr Devi Shetty.

And if you thought quality is the casualty, consider this figure. The mortality rates within the first 30 days of a surgery is just 1.4% in Narayana Hrudayalaya compared to 1.9 % in US hospitals, according to data gathered by a group of Chicago based surgeons.

Paediatric heart surgery is many times more complicated than adult cardiology as the child heart is just one tenth of its original size and whatever is done on it has to factor in the growth to its full size. Also unlike other surgeries, heart cannot be bypassed till the wounds and sutures heal, it has to work the moment after the surgery, else the patient dies ..what complication ..!!

I have had the good opportunity of meeting up with Dr Shetty at one of the Rotary Club meetings of the Narayana Health City  which has besides this a 1500 bed cancer hospital, eye care hospital etc.. Working on 3-4 surgeries a day, for 6 days a week, day in day out, the hospital sees that he and his group of 40 surgeons are given less administrative work so that all his time can be productively used on surgeries and patient care. Making them do more at the same salary that they are paid !! A cost cutting measure ..

With an efficient CEO Raghuvanshi and a team of 40 surgeons, Narayana Hrudayalaya is not going to lose its prominence once PadmaShri Dr Devi Shetty puts up his shoes, though he continues to be its face to the outside world. The service has to continue for posterity and the model - service factory, churning out services at low factory costs and high quality, should be the model for many a hospital in the world to emulate.

Dr Shetty says that it was a chance encounter and a chance to treat Mother Teresa till her last breath while in Kolkata that changed his life for ever !

Matching Supply and demand :

Unless there is a constant stream of patients needing the surgeries, the Hospital cannot have volumes to slash down the costs. NH has partnered with Karnataka govt by offering Yashaswini Insurance scheme which enables farmers from different parts of Karnataka to get their medical treatment at NH.

A novel micro Insurance scheme called Yeshaswini with the partnership of govt for all farmers of the state where they pay just 44 cents as annual premium  for healthcare, attracts many a poor customer to Hrudayalaya.

It is indeed heartening to note that low-cost Innovation, ( Gandhian Innovation - doing more at less cost) in the medical field too is now being driven from India ..

NH gives heavy competition to the cut-throat corporate hospitals in the country like Fortis, Apollo, Manipal a run for their money. They charge anywhere from 2.5 - 3 lakhs INR for a surgery and do just about half as much surgeries every year as Narayana Hrudayalaya does..

"Scaling operations (to reduce costs) and maintaining quality" is the crux of operations ..

There is a difference between philanthropy and squeezing the common man .. Even now only less than 10% of Indian population can afford a heart surgery .. Imagine the potential if costs are lowered even further .. ..

Here is Dr Devi Shetty at a TED talk in Mumbai ..

Here are some good articles I have compiled from the Internet for the readers.  The first and second ones are definitely the best !!

6. BBC calls it the "Production Line Heart Surgery" -

(photo cortesy and Wharton Business School, UPenn.)

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