NH Adapting Locally and

Globally
Session 4

02-07-2021 HETP – Session4 1

 Narayana Hrudayalaya Heart Hospital

Founded in 2001 by Dr. Devi Prasad Shetty

500 beds, 10 fully commissioned operating theatres (OTs), two cardiac

catheterization laboratories, and its own blood and valve banks.

The paediatric intensive therapy unit, consists of 50 beds, was one of the largest
in the world .
40% of all procedures performed at NH being paediatric treatment

02-07-2021 HETP – Session4 2

 To provide affordable cardiac care to the masses, NH followed a hybrid strategy of attracting patients
by virtue of wherever
Hybridpossible so thatfollowed
Strategy a larger number
byofNH people
forcould affordpatients
paying to seek treatment by

its reputation for high quality its costs of operation

The surplus gained frim paying patients was used to subsidize procedures performed for
patients who could not afford the full fee

02-07-2021 HETP – Session4 3

 • Heart hospital

• Yeshasvini Insurance Scheme

• Health City Plan

02-07-2021 HETP – Session4 4

 Heart Disease

• One of the most common illnesses in India

• Approximately 2.4 million people needed heart surgery every year,
due to lack of affordable treatment only 60000 surgeries were
performed
• Congenital heart disease was a particular concern – around 224000
new-borns in India affected every year
• Two common methods- Angioplasty and CABG

02-07-2021 HETP – Session4 5

 • Operation Strategy

• Telemedicine

• Outreach programme

• Training specialists

02-07-2021 HETP – Session4 6

 Operations Strategy at NH
Dr. Shetty called his strategy as ‘the
Wal-Martization of health care’
Embracing new technology to reduce
cost. Using digital X-Rays Instead of
chest X-rays to eliminate recurring
costs.
Salaries – NH spends 22% of
revenue (industry norm 60%); work
longer hours (12-16 hours a day) with
fixed salaries; not % revenue
generated
02-07-2021
NH performed approximately 19OHS Medical supplies - The hospitals
and 25 catheterization procedures a enjoyed 30-35% discounts, the
day almost eight times the average at largest cost component and also
other Indian hospitals signing short-term contracts.
Using comprehensive hospital
Pharmaceuticals – NH used Biocon
management software – min.
Ltd drugs - estimated up to 80%
inventory, quick processing of tests +
cheaper than market rate
increased hospital’s efficiency.
Financial – Finacial department
employed a unique daily accounting
Use of telemedicine
syrem wher all revenue and costs for
the day were accounted for
HETP – Session4 7
 Telemedicine
• Nine coronary care units(CCUs) across India linked to NH or RTI
• Each CCU was equipped with beds, medication, computer , electrocardiogram (ECG) machines, videoconferencing
devices and technical staff trained to operate the equipment.
• With the help of software development company (SN Informatics) they created a software program that allowed ECG
images to be scanned and transmitted via a web connection
• The project was supported by the Indian Space Research Organisation (ISRO) adopted telemedicine as community
project and provided connectivity for the CCUs free of charge by allowing to operate by satellite connection which
provides clear images.
• Outreach camp for cardiac diagnosis and care. Each weekend two buses sent our to rural areas up to 800 kilometres
away from the hospitals , each bus was staffed with atleast three doctors, including experienced cardiologist and two
technicians trained to perform echo cardiograms
• Buses were equipped with echocardiography equipment, a treadmill, a defibrillator, ECG machines, equipment needed
for resuscitation in emergencies and a generator

02-07-2021 HETP – Session4 8

 Training Healthcare Specialists
• They effectively involved in training the next generation of specialists

• 19 postgraduate programs for doctors and other medical staff.

• Diplomas in cardiac thoracic surgery, cardiology and medical laboratory technology.

• Offered country's’ only formal training program for paediatric cardiac surgery

• India’s first diploma in cardiology in collaboration with the Indira Gandhi National Open
University (IGNOU). The program require MBBS qualified doctors to spend two years
training at NH or at 50 recognised heart hospitals in India

• Training of nurses – a year of training with minimum six month period in a critical care unit

02-07-2021 HETP – Session4 9

 Yeshasvini
• Health insurance scheme for 1.7million farmers and their families in Karnataka

• Launches in 2002 for farmers belonging to various state cooperative. All farmers who had been member for atleast a year were

considered eligible

• For Rs 5 a month, cardholders had access to 150 hospitals in 29 districts of the state for any ,medical procedures costing up to Rs 100000

• In order to keep costs at minimum, the state government made available its post offices to collect the Rs 5 premium, track monthly

payment and issue a ‘yeshasvini member card’

• The first year showed the most common use of the scheme was for nonsurgical treatment. 9000 people underwent various operations and

a further 35000 received outpatients treatment across the state.

• The insurance scheme relied on using government infrastructure. NH’s reputation in the state helped gain support from both the farmers

and the hospitals

• New insurance programs – for teachers, to organize self-help groups in the state

02-07-2021 HETP – Session4 10

 Plan for Health City

The blood
bank, had
The Emami previously
National discarded
Another Institute for unused blood
building to Bone Marrow after 10 days
500 –bed house existing Transplant was now they
orthopaedic neurosurgery started in 2004 utilize blood
Neurosurgery and trauma and a planned as the state up to 26 days
unit was hospital paediatric unit largest bone after
Started started in May marrow collection.
noncardiac 2004 with transplant unit.
The plan was units with each three surgeons Reducing the
to build 10 speciality in and within cost from
hospitals in a new building 10months had national
common area constructed I completed 320 average of Rs
with one or the 35 acres operations 1.2 million to
two specialities around the Rs 400000.
hospital

02-07-2021 HETP – Session4 11

 Next?

How this could be

sustained?

02-07-2021 HETP – Session4 12

 HEALTH CITY CAYMAN ISLANDS

02-07-2021 HETP – Session4 13

 HCCI

To bring NH affordable 104 bed hospital located at the

HCCI was the outcome of Dr.
healthcare model to the western East End of the Grand Cayman
Shetty’s vison
hemisphere. Island

The cost of the hospital was

us$70 Million ; with US$30
Developed jointly by NH (based
million debt to the US$40
in India) and Ascension (in US).
Million equity investment shared
70:30 by Ascension and NH.

02-07-2021 HETP – Session4 14

 Narayana Health
2005 NH housed 500
beds, 10 operating
theatres, two cardiac
2001 Narayana catheterization labs and
Hrudayala was founded blood and valve banks.
02-07-2021 HETP – Session4
2011, the cardiac
hospital had evolved
into a multi speciality
2009, the first heart ‘health city’ that
transplant surgery in the consists of 25 acre
state of Karnataka was campus and housed a
2008, NH became one performed 900 bed heart hospital, a
of the first in Asia to 1400 bed cancer
perform an artificial hospital, a 500 bed
heart transplant. orthopaedic and trauma
hospital, a 300 bed eye
hospital, an organ
transplant institute and
departments in
neurosurgery ,
neurology, paediatrics ,
nephrology, urology,
gynaecology and
gastrentology.
They started building
multi speciality health
model in Kolkata and
Ahmedabad with 200-
300 bed low cost
general hospitals
15
 By 2013 the volume of cardiac
surgeries reached 7800 (5000
adults and 2800 paediatric
cases)

17600 catheterization lab

procedures

2400 of the adult cardiac surgeries

were CABG procedures.

Overall 15900 cardiac surgeries

performed which accounted for
12% of the 135000(approx.)
cardiac surgeries performed in
India

02-07-2021 HETP – Session4 16

 Innovative Mechanisms
• Telemedicine - accessible to more than 800 clinics across the world, including Malaysia,
Mauritius and the capitals of 53 African countries

• The Yeshasvini Program in 2003 with the support of the Karnataka state government
allowed its 4 million members to access to more than 1600 surgical treatment.

• The accreditation by JCI validated the high quality care at NH and this led to an increased
number of patients visiting from other countries like South Asia, the Middle East and
Africa. To cater to these international patients, NH developed services like assisting the visa
process, airport pick up and drop-off, local accommodation and other needs for their stray

02-07-2021 HETP – Session4 17

 Cayman Island and NH In 2009, NH signed a Memorandum of
Understanding with Cayman to develop
the Health City Cayman Islands (HCCI)
.
A one-hour flight from Miami, Florida was
a British Overseas Territory in the western
Caribbean sea consisted of three islands:
Grand Cayman, Cayman Brac and Little
Cayman with a total population of
approximately 50000 Dr. Shetty sought help for nine
supporting issues form the Cayman
Government

Cayman Islands’ GDP per capita (US$

58000) was the 14th highest in the worked
and the highest in the Caribbean tourism
and financial, services. On the 7th of April 2010 the agreement
regarding the development of HCCI was signed
. According to the agreement the first phase of
HCCI would be a hospital offering a limited
number of specialities and subsequent phase
would expand hospital in scope and size.

However both the sectors depended on US

economy thus the Great Recession in US
had severely affected the economy of
Cayman
The agreement exempted HCCI from all
tax liability for a period of 25 years
irrespective of any changes to tax laws.

02-07-2021 HETP – Session4 18

 Nine Point Request by Dr Shetty to Cayman Government
• Cayman Government will cap the amount of insurance claims related to non-economic losses in medical
malpractice cases

• Cayman Government will recognise medical qualifications from India and approve Indian doctors and nurses
to practice in Cayman

• Cayman Government will issue work permits for HCCI staff from India so that they can come and work

• Cayman Government will support the Health City in Cayman initiative in principle as it will bring large
economic opportunity to Cayman

• Cayman Government will allow HCCI to set up a large scale medical school to train nurses and doctors

• Cayman Government will permit HCCI to build a large assisted living community

• Cayman Government will help HCCI to obtain land at reasonable costs for the project

• Cayman Airways will work with HCCI to provide cheap fares and new flights to bring patients to Cayman

• Cayman Government will upgrade the airport to accommodate to increase in arrivals

02-07-2021 HETP – Session4 19

 Ascension
• In July 2011, NH was in their process of purchasing island in Cayman, however Dr Shetty wanted
to partner with a US healthcare organization willing to co-invest in the HCCI project

• Ascension was formed in 1999 with the four provinces of the Daughter of Charity if St. Vincent
de Paul and the Sisters of St. Joseph of Nazareth, Mich

• During 2013 Ascension earned $400 million in income from operations on total operating
revenues of $17 billion

• Ascension health managed around 19000 beds at over 110 hospitals and employed more than
155000 associated in more than 1900 sites of care on 23 US sates and the District of Columbia

• In 2013, Ascension provided $ 1.5 billion in care of persons living in poverty and other
community benefit programs/ Ascension realises the charity was inadequate and was looking fir
opportunities to transform US healthcare.
02-07-2021 HETP – Session4 20
 Opportunities for the locals

20 percent of the initial staff of 140 was

expected top be Caymanian. As health city
HCCI construction would create immediate
expanded it was expected about 30 -40
employment opportunities
percent od the total 8000 jobs created would
be staffed by locals,

Additional revenues was expected from

hotel, restaurant , retail and transport
business and for the government in terms of
work permit fees, visa fees and duties
earned on import of non-medical supplies

02-07-2021 HETP – Session4 21

 HCCI First Phase
• Construction started in February 2013
• The design followed JCI standards and borrowed ideas from the recently completed NH Mysore hospital to incorporate features like wall insulated
concrete forms (ICF) to reduce electric y bulk
• Two floors to ensure safety regulation and to reduce construction costs
• Large windows (for saving electricity and for the natural light), open bay 17 bed intensive care unit (allow nursing station to have an easy view of all
patients and staffed with fewer nurse)
• About 65% of the construction labour consists of locals
• Only specialist not available on the island were hired from outside and the vast majority of materials were procured from local business
• The construction effort took only a year by using modular pre-fabricated bathrooms, to u se solar energy and implemented Sea Water Air
Conditioning (SWAC) (reduced air conditioning costs by 75 percent
• Constructing a dedicate oxygen generation plant to reduce expensive oxygen cylinder procuring from outside the island
• iKare system – mobile technology based healthcare product which is already in use at NH India was implemented at HCCI
• Source medical equipment procurement from the existing supplier based in India rather than significantly higher costs (4x 5x) in US.
• A group of 96 – 18 doctors , 30 nurses, 26 para medical technicians and 22 administration staff were selected based on prior experience and
interviews .HCCI salaries was higher compared to Indian salaries but lower than corresponding US salaries
• Over the next six months, the non physician staff attended soft skill development program. The entire staff completed American Heart Association
Certification programs like BLS(Basic Life Support), ACLS (Advanced Cardiac Life Support) and PALS (Paediatric Advanced Life Support)

02-07-2021 HETP – Session4 22

 Pricing CABG procedure Questions

Discussion to review the Earlier estimated around $ 50, 000 resulting

Should HCCI rates be given the limited
operations plan and finalize the flexibility in increasing prices post the initial
in 200 cases
agreement with insurance companies?
procedure rates before any
formal agreement?
As the volume would grow to 450 cases per
year by the fifth year of operation, the team Would Dr Shetty’s model successfully
wondered pricing CABG at $50,000 would transfer out of India?
be appropriate

Would the model be relevant to the

developed world, as well as to other parts of
the developing world?

02-07-2021 HETP – Session4 23