Richard Smith: Can Devi Shetty make healthcare affordable across the globe?

Richard SmithIt’s impossible not to be impressed by Devi Shetty, heart surgeon and the “the Henry Ford of healthcare.” We can be impressed by his surgical skill and his refusal to turn away the poor. But perhaps even more impressive is his entrepreneurship and his vision of making healthcare affordable for everybody.

As he points out in his BMJ blog, a century after heart surgery was developed only 10% of the world’s population can afford it. India needs 2.5 million heart operations a year, and yet there are only 90 000. Most need is unmet.

Shetty has managed to reduce the cost of heart surgery dramatically. The average price for open heart surgery in Shetty’s hospital, Narayana Hrudayalaya Hospital, is around $2000, whereas it’s $5000 in the average private hospital in India and $20 000 to $100 000 in a US hospital. At the same time his family owned business is making higher profits than the average American hospital.  Shetty is clear that “charity is not scalable” and that good health care depends on good business.

 How has Shetty done all this and can developed countries learn from his achievements? The question of whether he can achieve something similar in a developed country has become real because of his plan to build a hospital in the Cayman Islands, an hour’s flight from Miami.

Scale is perhaps the main reason why Shetty has managed to reduce costs so dramatically. He has built a health city with thousands of beds that operates at near capacity, and it’s well established with complex surgery that high volume means better outcomes. And better outcomes mean lower costs because patients don’t need so long in intensive care and don’t need to have further operations. Shetty’ vision is to build more health cities, moving his group from 5000 to 30 000 beds.

One consequence of scale is that the group can use its purchasing power to drive hard bargains with suppliers and encourage new suppliers. Shetty galvanised a medical audience in England earlier this year by telling them that England should have three centres doing heart surgery not 22.

Standardisation is the next part of the answer. Present a medical case to 200 doctors, and you are likely to get 300 different answers to the patient’s problems. Healthcare is famous for huge variation in what is done, the outcomes, and the costs. Shetty is driving out that variation. He concentrates on improving processes and has reduced the rate of bed sores, a common complication in most hospitals, to zero. Now he wants to do the same for hospital infections.

 Technology is also important. “In five years’ time,” Shetty told the Health Services Journal, “a computer will make more accurate diagnoses than doctors. In 10 years’ time it will be mandatory for a doctor to get a second opinion from a computer before starting treatment.”

Another part of the puzzle is using staff efficiently. When Shetty spoke to a group in London by video he showed them a painting on his office wall and asked them to admire what must have been painted by a famous artist. In fact it was painted by a trained elephant. The World Health Organizsation estimates that the global shortage of health workers is four million, but Shetty thinks it is eight million. He sees a future of many more doctors and health workers but trained to do particular jobs in standardised systems.

How can all this be paid for? In the  Narayana Hrudayalaya Hospital 40% of patients can pay for their care, while 60% pay less with 20% paying almost nothing. The rich pay a premium for single rooms and other benefits, and Shetty operates a Robin Hood business model. He also runs a micro-insurance scheme and—despite his criticisms of the charitable model— encourages philanthropists to pay for surgery for the poor.

Shetty’s vision for governments is that they should run insurance programmes not provide care.
Some of Shetty’s model—scale, standardisation, more technology, and more efficient use of staff—is undoubtedly transferable to wealthy countries, but the resistance to change in health systems seems to be greater than in almost any other sector. Shetty may have his influence not by encouraging the incumbents to change but rather by brining competition to their doorsteps—as he plans to do in the Cayman Islands.

It’s in the developing world where Shetty may have most influence—because the health system is currently so underdeveloped. But I have to say that Shetty has a very different vision from that currently prevailing in global health. The current vision is much less about hospitals, specialists, doctors, and treatment, and much more about public health, primary care, community health workers, and prevention. Even in the poor world it’s heart disease, diabetes, cancer, and chronic respiratory disease that are causing the biggest problems, and these are conditions that can largely be prevented with simple measures.

Not everything can be prevented, however, and there will always be a need for hospitals and complex treatments. The challenge is to get the balance right, which is not the case in rich countries where treatment has tended to trump prevention, and a fusion of Shetty’s vision and the current global health vision could mean affordable health care for everybody in developing countries.

Competing interest: This piece was written to accompany a series of programmes on Devi Shetty’s health city currently being show on Al Jazeera:  The programmes have been made by Paul Roy, a friend of RS’s, and RS was asked to write a piece for the Al Jazeera website on whether Devi Shetty’s vision might make health care more affordable in developed countries. He is expecting to be paid for the piece.

Richard Smith was the editor of the BMJ until 2004 and is director of the United Health Group’s chronic disease initiative.

  • Dr RNSrivastava

    Cardiac surgery and other tertiary procedures are quite dramatic and attract a great deal of media attention. Can this model work for organ transplantation? Developing countries must identify their problems and priorities. A huge number suffer from preventable diseases, and “lifestyle” disorders. These must be tackled with global effort. Health education and information are crucial. Vector and water – borne diseases must be controlled. Developed countries again need to adopt whatever model can be used for all people. A sizable number should not be left behind. Dr Devi Shetty’ s venture is benefiting a fraction of the needy.

  • Dr.Pandurangan Harikrishnan

    I agree Devi shetty’ model will work in India, seperately in each speciality by creating centers of excellence providing high quality care with good outcomes than multiple small centers. Government should provide insurance and monitor the health care delievery system. Rich people funding these centers will be beneficial to the community and also satisfying the Donors and family. Basics of prevention from school education is baseline for future healthcare in India.