Fond memories are not something that an average person associates with hospitals, but for most Indians, their relationship with hospitals has always been more than a little fraught. Given the scarcity of good hospitals, doctors and nurses and the prohibitive treatment costs -— not always covered by insurance — people can’t really be blamed for becoming increasingly anxious at the prospect of hospitalisation. And there are enough associated challenges to worry about — decent and affordable post-operative care, trustworthy service professionals, convenient visit timings and consistent follow-ups. For those living away — especially overseas — from their geriatric family members, these problems are compounded manifold. And this is precisely where the next big opportunity — and challenge — for the healthcare industry lies: home-based healthcare. Over the past few years, several companies have popped up in this space, trying to bridge this gap and offer a significant advantage over the prohibitively priced home visits or nursing solutions offered by some hospital chains. Some of the well known names include Bengaluru-based Portea Medical, Chennai-based India Health Care at Home (IHCH), Hyderabad-based Medwell Ventures and the Delhi-based Health Care at Home (HCAH). But how exactly are they faring in a highly unorganised market where cost and convenience are the main motivators for customers?
That need for convenience, in fact, is what led to the launch of most of these companies. IHCH founder V Thiyagarajan had found it difficult to supply reliable nurses to the ailing mother of one of his friends. This, coupled with the complete lack of home healthcare providers, prompted him and his doctor wife to go to the US and intern with a retirement home community and home healthcare firm, respectively. Three months later, IHCH came into existence. Serial entrepreneur power couple K Ganesh and Meena Ganesh, on the other hand, didn’t have any training in the field but were looking for an investment opportunity after exiting their education enterprise Tutorvista. “Education and healthcare were the obvious choices, as these sectors always offer great opportunities to build businesses,” recalls Portea CEO Meena Ganesh. Again, what catalysed her decision to take over Portea in 2013 from founders Karan Aneja and Zachary Jones, who had started the company in the US and brought it over to India, was a bad experience with post-discharge healthcare for a family member. “The delivery of healthcare outside hospitals was very poor back then. Consistently reliable and quality healthcare was non-existent,” says Ganesh. Much like the duo, healthcare professional Lalit Pai and former Fortis Group CEO Vishal Bali spotted a business opportunity for managing chronic diseases within the home healthcare segment and started Medwell Ventures in April 2014. HCAH, on the other hand, was launched by Gaurav Burman, Gareth Jones, Charles Walsh and CEO Vivek Srivastava, as a joint venture in 2012.
What’s on offer
The services rendered by these companies don’t stop at crucial post-operative care, either. For instance, Portea offers doctor visits, long-term nursing care, attendants, physiotherapy for rehabilitation and lifestyle problems, diagnostic pick-ups, medical equipment on a rental basis, delivery of medicines and point-of-care services for a variety of ailments such as diabetes, neurological disorders, cancer, chronic obstructive pulmonary disease (COPD) and cardiovascular diseases. Medwell provides home healthcare for patients who’ve had strokes, COPD, diabetic wounds, dementia and mental healthcare, dental care and oncology treatments. Based on an initial assessment by its team, a comprehensive care plan is prepared and the treatment is decided for each patient. While HCAH started out providing post-operative care, it later expanded its range to include post-organ transplant, home oncology, home ICU ventilators, pulmonology care, physiotherapy and a range of allied services such as dressing, injection administration and lab sample collection.
Medwell stresses on its quality of care and convenient services. For home ICU ventilators and IV treatment, the company’s costs range from Rs.12,000-14,000 a month to Rs.22,500 a month and Rs.10,000-12,000 a month, respectively; at a hospital chain, ICU ventilators would cost around Rs.1.8 lakh-3 lakh a month and IV treatment Rs.60,000-1.2 lakh a month. Portea, on the other hand, offers both standard and customised packages, among them being elder care packages and those for diabetics and cardiovascular patients. Its packages are priced 10-50% less than what most hospitals and clinics charge, depending on the treatment and situation. For instance, for chemotherapy, the drug, doctor and nursing care costs come to Rs.25,000 at most hospitals, versus Rs.16,000 at home for Portea’s services. “Our main target group is the middle class and we want to ensure that everybody has access to really good quality care at home. But we do also offer premium packages — priced between Rs.40,000 and Rs.50,000 a month -— to patients who need extensive treatment and can afford it,” says Ganesh. In fact, Portea is working closely with some insurance companies under exclusive agreements to cut costs for patients. Apart from other extensive therapies such as oral chemotherapy, neurology and cardiology care, the company also offers physiotherapy, neurology, cardiology and CTVS pulmonology, pediatric, gynaecology, oncology and geriatrics services. It also provides customers with point-of-care devices, data from which is uploaded onto a management portal, through which clinicians monitor the heart rate, pulse rate and other vital parameters of the patients. As for HCAH, its services come in the form of packages priced at Rs.500 a day for things like injections and blood infusions to Rs.15,000 a day for home ICU (hospitals charge Rs.3,000 and Rs.50,000, respectively, for the same services).
Instead of taking hospitals head-on and competing directly, these companies choose to tie-up with them for referrals instead. Apart from digital advertising, Portea acquires customers through referrals by hospitals and doctors — around 30% of its patients are sent to it by hospitals. The company has tied-up with nearly 40 hospitals in the country, including Manipal Hospitals, Columbia Asia Hospital, CumbalaHill Hospital and Fortis Malar Hospital. With nearly 2,200 employees, including 25 doctors, 300 nurses, 350 physiotherapists and 1,500 nursing attendants, on its rolls, Portea operates in 22 cities and conducts 50,000 patient visits a month. The company raised $9 million in series A funding from Qualcomm, Venture East and Accel Partners in December 2013 and is looking for funding to achieve a 50-city footprint within the next two years. In comparison, Medwell functions only in Bengaluru and Hyderabad with 400 employees, servicing 8,500 customers. The company uses an EMR system to collect data and save medical records and customers can access these on a real-time basis. Pai says, “Medwell will add to the eight branches it has in Bengaluru and Hyderabad and foray into six more cities by the end of 2018.” The company has raised $10 million from Fidelity Partners, although Pai is mum on how much more cash will be required for the expansion. IHCH is present in 11 cities, including Chennai, Bengaluru, Hyderabad and Pune, and seven more in Gujarat, and is now looking to enter Coimbatore, Visakhapatnam and Chandigarh. The US-based Bayada Home Health Care has invested $10 million so far in the company. “Our partnership with Bayada, which has 40 years of experience in this field and provides extensive training and support to our staff, is a key differentiator,” says Thiyagarajan, who intends to scale up the business to 30 cities in the next five years at an estimated cost of $10 million. Finally, HCAH has 4,000 clients and does 3,500 patient visits a month through its staff of 350.
Fueling this growth and, indeed, being the central pillar of support for the home healthcare business is technology, which plays a key role in this industry, right from monitoring patients to remote monitoring of clinicians. In Portea’s case, every aspect of the patient’s care is monitored through an enterprise resource platform. All clinicians and field staff are monitored through an Android app on smartphones that the clinicians have to carry. Likewise, patients can book and monitor appointments, check their health records and provide feedback via the same app. Portea has addressed standardisation by using this proprietary app and tech platform to display its SOPs for each medical procedure. The company currently uses American Megatrends’ smart diagnostic tool called BOLT, which collects patient BP, temperature and pulse oximetry in a passive manner, and is in the process of creating predictive analytics, which will allow its technicians to proactively intervene when a patient’s health indicators deteriorate. In IHCH’s case, the company uses training practices adopted from BAYADA and has incorporated a technology platform to impart training and monitor the process. “All the procedures — from monitoring patients and clinicians to updating patient data — are followed through a CRM platform and this is augmented by a cell phone app through which clinicians can pull out data,” adds Thiyagarajan. To ensure standardisation of care, every city manager in the company is sent to the US to receive training at BAYADA. “We have leveraged technology from day one and been paperless thanks to our technology platform. We have also tied up with outstanding players overseas to design our protocols and train our staff,” says Srivastava. HCAH has also invested millions in setting up a completely automated paperless technology platform that registers customers through SMSes and has automated care plans on the basis of the customer discharge summary. All its medical staffers carry tablets that have the patient’s medical history and care plan fed into them and send a home visit report that goes to the doctor and the patient’s family. Doctors can monitor the process on video through their phones.
But then, the industry is not only manpower intensive but also highly dependent on the quality of the clinicians and other medical staff employed. And given the predatory practices in the health industry, finding the right talent can be a bit of a challenge. To address this, Portea has instituted an extensive training programme and works closely with physiotherapy, nursing schools, and the National Skills Development Council to hire and train nurses. Initially, hiring nurses and retaining them proved to be such a huge challenge for IHCH that Thiyagarajan was nearly ready to pull the plug on the business. But he changed tack, replacing nurses with female medical assistants. IHCH focuses heavily on geriatric services — 65% of its patients are geriatrics, while the rest comprises differently-abled children, stroke and cancer patients and those who require post-operative geriatric, neuro and pregnancy care. Owing to low profitability in working with short-term patients (currently, it operates at 10% net margins and 45% gross margins), the company services only long-term patients, to whom it provides caretakers who also double up as cooks and drivers. Doctors and nurses are provided in line with the package — Rs.5,000, Rs.8,000 and Rs.25,000 a month — subscribed to. The company has a total team strength of 824 and will be hiring physiotherapists on a freelance basis soon. The company posted a revenue of Rs.15 crore in FY15 and Thiyagarajan expects revenues to multiply fivefold to Rs.75 crore in FY18. But BAYADA founder Mark Baiada cautions, “It is difficult to scale a service business rapidly and yet maintain a high quality standard. Hiring and retaining high-quality staff is also a problem. This will be a key challenge for IHCH.” Gaurav Burman, co-founder and investor in HCAH, agrees that scaling up could be a challenge. “Maintaining a patient-centric business as you grow quickly and geographically is a key challenge; everyone in the company has to be passionate about what it does and continue to demonstrate the highest standards at all times,” says Burman. Both companies are relying heavily on technology and intensive training of their resources to overcome the standardisation challenge.
And the importance of quality control cannot be underestimated given the high expectations customers have from companies in this field. A case in point is the middle-aged Monica Sachdeva, who availed of HCAH’s services for cervical back pain and muscle spasms that she and her geriatric aunt were facing. Sachdeva was happy that the usually 15-day isometric and muscle-strengthening exercise treatment ordeal was shortened to just five days with HCAH, since that is how long it took for her pain to disappear. While she was happy with the prompt and good quality care, she complains, “HCAH’s services are priced on the higher side, especially with respect to physiotherapy. When I recommend their services, people are a little reluctant to sign up because of the pricing.” Her sentiments are echoed by Rima Bhattacharjee, who availed of the company’s services for her father, who was suffering from brain surgery complications. She feels that while the company’s promptness and care standards were good, more frequent auditing and patient monitoring could have been conducted. While there have been huge learnings for the Indian market in terms of protocols to be followed and devices to be used from the US, there is still a long way for these companies to go towards becoming the panacea that the Indian healthcare market needs. At the end of the day, while the home healthcare business receives ample private insurance support in developed countries like the US, the same has not happened yet in India. Home healthcare companies are lobbying hard with insurance companies and they believe in 2-3 years insurance should cover home healthcare once proper guidelines are in place by IRDA. Portea is working closely with some insurance companies under exclusive agreements to cut costs for patients. It is also lobbying with government to ensure home healthcare is covered under the central government health scheme for its employees.
However, with rising income levels in the economy, increase in working women, geographic separation of families and India having the second largest geriatric population in the world, the potential for these businesses to scale up remain immense but the chinks in their execution ability — be it standardisation of care or finding and retaining talent — need to be addressed quickly. While hospitals concentrate on critical surgeries and reducing the average length of stay (ALOS) of their patients as it becomes less lucrative for hospitals if the patients stay longer, home healthcare definitely fills a void in the healthcare value-chain. That is not the only reason it will grow in size though.