Press release from Business Wire India
Source: Accelerator Group LLC.
Sunday, December 06, 2009 10:00 AM IST (04:30 AM GMT)
Editors: General: Consumer interest, Economy, Law & justice, People, Politics, Social issues; Business: Advertising, PR & marketing, Automotives, Banking & financial services, Business services, Education & training, Healthcare, biotechnology & pharmaceutical, Transport engineering; Technology; Automotive; Healthcare
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Accreditation and Privatization of Medical Education Critical for Indian Healthcare Industry - Accelerator Study Highlights Challenges and Opportunities.
Gurgaon, Haryana, India, Sunday, December 06, 2009 -- (Business Wire India) -- Accreditation of hospitals and privatization of medical education are critical to the sustained growth of Indian healthcare industry as it faces several challenges that may impede robust growth. India's hospital industry faces significant shortage of qualified manpower in all categories of doctors, nurses and paramedical staff. This is perceived to be the single most important challenge that Indian hospital industry will have to reckon with. Additionally, building of hospitaIs without a mandatory 'needs analysis' in light of catchment area requirements will lead to an uneven development of healthcare delivery infrastructure and hamper optimal utilization of scarce resources.
Affordability of the high cost of technology by consumers of healthcare in India will necessitate significant adaptations to technology in the context of Indian markets. This is especially important in light of the escalating costs of material and equipment.
Hospitals also face limitations due to significant bureaucratic hurdles in obtaining clearances for setting up new facilities. The other governmental policies that will hinder growth are lack of a consistent policy on accreditation of healthcare delivery institutions, existence of arcane rules that prohibit participation of private sector in owning and operating medical and paramedical educational institutions, lack of availability of health statistics which could promote proper planning of facilities and low government budget allocation to healthcare as an industry.
These challenges to the Indian hospital industry are part of the findings of a recently released report - Sustaining & Growing, a survey of hospital CEOs in India, authored by Accelerator Group LLC. Accelerator Group is a US and India based investment banking firm specializing in healthcare. It has been actively advising India based hospital clients in strategic alliances and raising capital such as a recent transaction where in their client Rockland Hospital received funding from International Finance Corporation.
Accelerator Group conducted this study through a survey of CEOs, Chief Strategy Officers and senior management teams of 50 hospitals in India including national leaders such as Max Healthcare, Fortis Healthcare Limited, Global Hospitals Group and several regional hospitals such as Rockland Hospital, Heritage Hospital, Soni Group of Hospitals, Sahyadri Hospital, Kerala Institute of Medical Sciences, Soundarpandian Bone and Joint Hospital, Rajan Eye Care Hospital Private Limited.
This study focused primarily on the private sector to better understand the best practices, which are being employed by hospital managements in light of the increasing 'corporatization' of India hospital industry. 80% of the respondents were tertiary hospitals and 20% were secondary hospitals.
Ms. Seema Chaturvedi, Managing Director of Accelerator Group, emphasized the importance of these findings in light of the dominance of private sector in delivery of healthcare in India. Additionally, she noted, "with almost 80% of healthcare consumption being financed by private payers, especially through out-of-pocket means, it is critical that CEOs share best practices through such forums to allow for a multiplier effect that leverages the knowledge pool and optimizes resources."
The study highlights the extremely high level of optimism among all participants for the sustained growth of the industry. All respondents were very optimistic about the growth potential of the hospital industry in India in the medium and long term. In the short term, 60% of the respondents were very bullish while 40% indicated a medium level of optimism.
Despite the high capital intensity of the industry, most respondents are planning significant scale-up of the delivery infrastructure. This is expected to come from both Greenfield and Brownfield expansions. A key issue in seeking financing for these expansions was the still prevalent commercial terms that are extended by most commercial banks, as hospitals are perceived to be part of the 'real estate industry' as opposed to being part of the 'infrastructure industry.'
Private sector respondents underscored the substantial benefits of encouraging a strengthening of public-private partnership (PPP) models for healthcare delivery and education as a powerful mechanism for improving healthcare delivery outcomes. Improved awareness of diseases and prevention, mandatory accreditation of hospitals, and provision of a grading mechanism to rank hospital facilities were cited as policies that can lead to favorable healthcare delivery outcomes.
Key strategies being adopted for revenue expansion and cost reduction were identified by respondents. Focus on improving productivity of employees is an important cost containment measure being employed by many respondents. As part of understanding best practices for recruitment and retention respondents highlighted the need to for ongoing training and professional development to be significantly more important than compensation.
About Accelerator Group:
Accelerator Group LLC. is an investment banking advisory services firm focused on providing high quality services in areas of business combinations, mergers and acquisitions and raising growth capital. Accelerator Group also provides customized knowledge services in areas of business intelligence and market research. The firm specializes in the healthcare & pharmaceutical, manufacturing (automotive & aerospace) industries. It has offices in India and USA. www.agroupllc.com
CONTACT DETAILS
Shivam Trivedi, Accelerator Group LLC., 001.248.723 0808 (USA), +91 (124) 404 9479 (India), healthstudy2009@agroupllc.com
KEYWORDS
CONSUMER, ECONOMY, LAW, PEOPLE, POLITICS, SOCIAL, MARKETING, AUTOMOTIVE, BANKING, BUSINESS SERVICES, EDUCATION, HEALTHCARE, TRANSPORT, TECHNOLOGY, AUTOMOTIVE, HEALTHCARE
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