HEALTHCARE SERVICES IN INDIA 2012: THE PATH AHEAD

Link:http://www.assocham.org/7km2009/presentations/Inaugural_Session/Mr_Abhishek_Bhagat_Sr_Vice_Presid ent_Yes_Bank.ppt#346,1,HEALTHCARE SERVICES IN INDIA 2012: THE PATH AHEAD

Indian Economy on a Growth Path

Consistently growing GDP (%)
10 8 6 4 2

Indian economy in a resilient mode in terms of GDP growth Mobile connections have increased from 6 mln in March 02 to 362 mln in June 09

0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

Growth of Healthcare Industry The Healthcare Industry has grown from USD 18.7 bln in 2000 to USD 35 bln in 2008.
40 35 30 25 20 15
CAGR 9.3%

Increasing mobile penetration

No. of Mobile Connections (mn) 400 350 300 250 200 150 100 50 0 362 261 161 90 52

10
5 0 2000 2005 2008

34 13 6 2002 2003 2004 2005 2006 2007 2008 2009

Population Growth
India is the worlds second most populous country Significant population growth between 1970 - 2000
1,600 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% Indian Population Count (mn) 1,400 1,200 1,000 800 600 400 200

With a billion plus population the need for healthcare is universal for both Urban and Rural India. With an increasing incidence of life style diseases (approx. 33 percent of the total pie) and a growing geriatric and pediatric population, there is an emphasis on the need for specialty care
Derma 6% Neuro/ CNS 6% Gynaec 6% Vitamins/ minerals/ Nutrients 10% Pain/ Analgesic 10% Gastrointestinal 13% Anti-Diabetic 5% Antiinfectives 21%

-0.5%

60 yrs & above

6 yrs & below

7 - 14 yrs 15 - 59 yrs

Respiratory 11%

Cardiac 12%
3

Public Healthcare
There has been a significant increase in public infrastructure over the years. While in 1947 the number of hospital beds was 3.2 per 10,000, the present number of 9 per 10,000 is commendable, but still far behind that of other developing countries The governments share in the healthcare delivery market is only 20 percent. The current NHP aims to increase the government contribution to healthcare to touch 2 percent of the GDP by the end of the five year tenure, an increase from the present contribution of 0.9 percent. Government Initiatives like NRHM, NUHM and RSBY are working towards better healthcare for the poor.
Country Japan France Switzerland Australia United States of America Thailand Malaysia India
4

Head
Beds/ 10000 141 73 57 40 32 29 18 9

Budget FY10
INR Cr 14,127 1,448 734 350 100 10 4,344 21,113

National Rural Health Mission Institutes like AIIMS in Tier II cities AYUSH Rashtriya Swasthya Bima Yojana (RSBY) Medical education for OBC National Programme for Prevention and Control of Deafness (NPPCD) Other heads Total

Private Healthcare
India has one of the highest private spending in healthcare as compared to other countries. Nearly 80% of the total spend. In India, Out of pocket spending is one of the highest, constituting 94% of the total spend in the private health industry. Extensive landscape of private players with multi & super specialty hospitals, innovative rural models, and MediCities. Increasing Private Equity investment into the sector, with an affinity towards innovative rural models and super specialty care. With Infrastructure status, 100% FDI under the automatic route, Service Tax exemption and Rural and Tier II hospitals exempt from Income Tax for 5 yrs, Private healthcare is on a high growth path.
No. of Beds

8000 Apollo 7000 6000 5000

4000
3000 2000 1000 0

Fortis
CARE Hospitals Narayana Hrudayalaya Kolkilaben Ambani Hospital Dr. Trehan's MediCity Max

Healthcare Services Associated Industries

Diagnostics & Pathology
3.0 2.5 USD bn USD bn 2.0 1.5 1.0 0.5 0.0 2006 2008 2012 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 -1.0 -2.0

Medical Equipment & Devices

2006

2008

2012

Medical Tourism
1.2 1.0 USD bn 3.5 3.0 2.5

Private Health Insurance

USD bn
2006 2008 2012

0.8 0.6 0.4 0.2 0.0

2.0 1.5 1.0 0.5 0.0 2006 2008 2012

The Healthcare Industry In India: 2012

INDIAN HEALTHCARE SERVICES INDUSTRY TO REACH USD 77 BILLION BY 2012
80 Insurance Medical Equipment Diagnostics

70
Medical Tourism 60 Hospitals

USD Bn

50

40

30

20

10

Insurance Medical Equipment Medical Tourism Diagnostics Hospitals

2006 0.49 0.18 0.35 0.83 19.15

2008 1 0.4 0.5 1.2 27.4

7

2010 (P) 1.9 4.8 0.7 1.7 32.9

2012 (P) 3 6.7 1 2.5 54.5

Growth Drivers
Economic Growth

Availability of Insurance

Regulatory Support

GROWTH
Available Skilled Manpower

Changing Population Demographics

Multiplicity of Disease Profile

Challenges & Recommendations

Challenges
Low Government funding & lack of efficient execution of schemes & initiatives Shortfall in Health care infrastructure and Workforce Inadequate accessibility to affordable quality services Financial constraints with respect to infrastructural needs

Recommendations
Step-up in Government funding and initiatives via a special task force Implementation of REITs and increased use of Private-Private Partnership Models Addressing geographic accessibility through PPP and harnessing local resources

Creating a Global Source of Skill

Efficient dissemination of healthcare related information Establishment of Industry Body with adequate representation from all stakeholders