Narayana Hrudayalaya is Walmart meets Mother Teresa.
The organization, a complex of health centers based in southern India (narayana hrudayalaya means "God’s compassionate home" in Sanskrit), offers low-cost, high-quality specialty care in a largely impoverished country of 1.2 billion people. By thinking differently about everything from the unusually high number of patients it treats to the millions for whom it provides insurance--and by thinking a lot like the world’s largest retailer--the hospital group is able to continually wring out costs. Narayana Hrudayalaya’s operations, for instance, include the world’s largest and most prolific cardiac hospital, where the average open-heart surgery runs less than $2,000, a third or less what it costs elsewhere in India and a fraction of what it costs in the U.S.
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"This hospital is for poor people, but we also treat some rich people. So we’re mentally geared for people who are shabbily dressed and have trouble paying. We don’t look at them as outsiders. We look at them as customers." Narayana Hrudayalaya’s flagship hospital has 3,000 beds, more than 20 times as many as the average American hospital. The company (mostly family owned, with JPMorgan among a handful of investors) negotiates for better prices and buys directly from manufacturers, cutting out distributors.
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The company targets even routine inefficiencies. A beefed-up support staff handles the onerous paperwork for surgeons, freeing Shetty and his colleagues to perform more operations than a typical cardiac surgeon would, about a dozen a week.
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Patients who pay discounted rates are in effect compensated by those who pay full price or opt for extra perks. Typically, the latter group includes foreigners for whom a $7,000 heart operation, access to an experienced specialist, and a deluxe private room is a relative bargain. The balance of patients is, in fact, crucial. Every day, Narayana Hrudayalaya’s surgeons receive a P&L statement of the previous day that describes their operations and the various levels of reimbursement.
(..)
Before becoming one of India’s best-known health-care entrepreneurs, Shetty was its best-known heart surgeon. He was interrupted in surgery one day during the 1990s by a request to make a house call. "I said, 'I don’t make home visits,' " Shetty says, "and the caller said, 'If you see this patient, the experience may transform your life.' " Which is exactly what happened. The request was from Mother Teresa.
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The organization, a complex of health centers based in southern India (narayana hrudayalaya means "God’s compassionate home" in Sanskrit), offers low-cost, high-quality specialty care in a largely impoverished country of 1.2 billion people. By thinking differently about everything from the unusually high number of patients it treats to the millions for whom it provides insurance--and by thinking a lot like the world’s largest retailer--the hospital group is able to continually wring out costs. Narayana Hrudayalaya’s operations, for instance, include the world’s largest and most prolific cardiac hospital, where the average open-heart surgery runs less than $2,000, a third or less what it costs elsewhere in India and a fraction of what it costs in the U.S.
(..)
"This hospital is for poor people, but we also treat some rich people. So we’re mentally geared for people who are shabbily dressed and have trouble paying. We don’t look at them as outsiders. We look at them as customers." Narayana Hrudayalaya’s flagship hospital has 3,000 beds, more than 20 times as many as the average American hospital. The company (mostly family owned, with JPMorgan among a handful of investors) negotiates for better prices and buys directly from manufacturers, cutting out distributors.
(..)
The company targets even routine inefficiencies. A beefed-up support staff handles the onerous paperwork for surgeons, freeing Shetty and his colleagues to perform more operations than a typical cardiac surgeon would, about a dozen a week.
(..)
Patients who pay discounted rates are in effect compensated by those who pay full price or opt for extra perks. Typically, the latter group includes foreigners for whom a $7,000 heart operation, access to an experienced specialist, and a deluxe private room is a relative bargain. The balance of patients is, in fact, crucial. Every day, Narayana Hrudayalaya’s surgeons receive a P&L statement of the previous day that describes their operations and the various levels of reimbursement.
(..)
Before becoming one of India’s best-known health-care entrepreneurs, Shetty was its best-known heart surgeon. He was interrupted in surgery one day during the 1990s by a request to make a house call. "I said, 'I don’t make home visits,' " Shetty says, "and the caller said, 'If you see this patient, the experience may transform your life.' " Which is exactly what happened. The request was from Mother Teresa.
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