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SURAJ

  • 1. Submitted by: Sanjay Bhatt Umakanta Sahu Rohit Kumar Abinash Subudhi Janmejaya Das Healing Touch: Universalizing access to quality primary healthcare Team SURAJ from Indian Institute of Management(IIM) Kozhikode
  • 2. Contextual Background for primary Healthcare Status 3% 8% 56% 28% 5% Primary healthcare Issues from Primary Data Collected Medicines and Vaccines Staff Condition Infrastructure Distance and Connectivity 0 10 20 30 40 50 60 70 1998 2000 2002 2004 2006 2008 2010 2012 2014 Infant Mortality Rate(deaths/1,000 live births) Source: World bank Data  Hospital beds-to-People ratio: 9:10000 where as WHO benchmark is 35:10000; World average: 26:10000  Difference between CAGR of total health expenditure and CAGR of GDP for India: -1.7% where as for Low-and-Medium income countries(LMIC) average is 0.07%  1/5th of the 2,87,000 maternal deaths worldwide in 2010 occurred in India (WHO 2012)  Shortage of at least 6.4 million skilled health personnel  Government spending on primary healthcare is only 1.04% of GDP.  Nearly 70% of the healthcare expenditure is from patient’s own pocket due to low quality healthcare provision by the govt.
  • 3. Issues and Challenges Major Issues Lack of regulation in private sector Lack of accessibility to medicines and healthcare facilities Unavailability of healthcare personnel Inadequate public healthcare infrastructure Infectious diseases dominate the morbidity pattern: 40% Absenteeism Rate for medical personnel is as high as 40% Only 3% specialist physicians serve the whole rural India. 39% PHCs do not have lab Technicians 18% PHCs do not have a pharmacist 70.2% shortfall of medical specialists in CHCs 68% of the population live in Villages 66% of rural Indians DO NOT have the access to the critical medicines 8% primary health centres do not have doctors 31% of the population travels more than 30 kms to seek healthcare RURAL INDIA More than 1 million babies born every year in urban slums having NO or minimal medical assistance. 31.5% of private hospital visiting population goes to doctors having limited or NO SKILLS 32% (growing) of the population live in urban India 70% of urban population visit for doctors to private hospitals Only 25% of specialist physicians live in semi- urban areas. 1/4th of urban population live in urban slums URBAN INDIA
  • 4. Proposal 1: National Medicine Policy Easy Access to medicines: Proposed Medicinal products distribution System Patent Protection Department Bidding Process Central Health Department Bidding must incorporate pricing based strategy and stringent quality check Procurement of medicine through Medical Store Organization(35% Proposed) DRUG DISTRIBUTION SYSTEM Defense Central Govt. Health Centre State Owned Health Centre Public Sector Units National Depot13 national Depot 6 Sub-Depot Assume: Each national depot will cater 30-35 districts and sub-depot will cater 20-25 National Depot Sub-Depot Sub Depot To district hospitals catered by different depots District Hospitals Block medical Centre 1 Block medical Centre nBlock medical Centre 2 PHCs CHCs PHCs CHCs  Distribution from block medical centers to PHCs and CHCs will be done through the recommendation from the doctors servicing these PHCs and CHCs.  Communication to the rural mass for the assurance of the drug standard will be done by “Swathya Sahayaks”, present in CHCs and PHCs
  • 5. Proposal 1: National Medicine Policy Easy Access to medicines: Proposed Medicinal products distribution System (Contd…)  National drug depot to increase from current count 7 to 13 with 6 new sub-depot to increase the accessibility, timely replenishment and thereby catering to the demand of generic and specialized drug.  The Overall Value chain(up to district level) be implemented using Enterprise Resource Planning(ERP) through the Ministry of Health and Family welfare in collaboration with the Ministry of Communication and Information technology to monitor the distribution system effectiveness  Through bidding process ERP vendor should be selected: SAP, Oracle Applications R12.1.3 g, Microsoft Dynamics AX are few options  Significant amount of cost savings by eliminating intermediaries(middle-men, agents etc.)  To restrict the involvement of drug mafia, ensuring the supply of quality drugs to the people  Material Resource Planning(MRP) to be implemented using ERP to avoid any leaking, man handling and Business-to-Business(B2B) level corruption based on demand and supply mismatch. (Monitoring Purpose)  MRP will also contribute significantly towards the demand forecasting and fulfillment  Capturing the demand of specialized and chronic disease drugs to avoid local procurement by the state government.  Inventory Management System to be implemented in depot level to cater zone specific demand. (Monitoring Purpose)  Nationally Standardised Regulation of medicines should be managed through rational and transparent criteria and processes  Regulations to ensure appropriate practices are followed in the development, production, supply and disposal of medicines, and that any problems are met with a quick, effective and appropriate response  The level of regulation should be consistent with the potential benefits and risks for the community and based on appropriate risk-assessment processes  There should be an effective post-market monitoring system (for example, for adverse drug reactions), to ensure ongoing assessment of safety  Patent protection law must be strictly monitored to avoid duplication and unnecessary restrictions and to facilitate early availability of therapeutic advances CASH AND MEDICINE IN THE PIPELINE MONTHS Purchase pipeline: About 35% of the medicinal products used in the Indian pharmaceutical market must be sourced by the GoI. An average of 2 months will elapse between the provision of letter of credit and the receipt of the pharmaceuticals at the central supply agency. 2 Safety Stock: A 3 month safety stock will be maintained at the central supply agency. 3 Working Stock: The central agency will tender once a year but will receive deliveries every 4 months. This strategy implies a maximum working stock of 4 months and an average working stock of 2 months. 2 District Hospital Safety Stock: The district medicals will maintain a SS of 2 month. 2 PHCs and CHCs Safety Stock: These must have safety stock of 1 month. 1 District to Centre Cash Transfer: Money received by the district medical stores will be deposited within the week at the local branch of the national bank. On an average, this money will take 1 month to be credited to the account of the supply agency. 1 Cash on hand: In general purchases made by the supply agency will represent 1/3 of its annual turnover. As a result, money will sit In the agency's central account up to 4 months, or on an average 2 months, before being used to effect a purchase. 2
  • 6. Cost Structure Model for the proposed alternatives Medicinal products distribution System  Assumption: The system will be implemented within a span of 9 months.  All calculations are done based on the 13 proposed national and sub-depots.  Only incremental calculations are shown to evaluate the extra monetary burden that the GoI has to carry from its GDP expenditure towards its healthcare.  Software implementation calculation is based on Oracle Fusion ERP software and Sun Microsystem (Oracle Systems) Exadata Server.  Labor hour taken: 6 hours per day for project design and 7 hours per day for Project Development and no. of working days = 22 per month Source of Project Cost(IT and ITes) PROJECT TASKS LABOR HOURS LABOR COST ($) MATERIAL COST ($) TRAVEL COST ($) OTHER COST ($) TOTAL PER TASK Develop Functional Specifications 396.0 ₹ 7,92,000.00 ₹ 1,00,000.00 ₹ 5,00,000.00 ₹ 50,000.00 ₹ 14,42,000.00 Develop System Architecture 396.0 ₹ 7,92,000.00 ₹ 1,00,000.00 ₹ 5,00,000.00 ₹ 50,000.00 ₹ 14,42,000.00 Develop Preliminary Design Specification 396.0 ₹ 7,92,000.00 ₹ 1,00,000.00 ₹ 5,00,000.00 ₹ 50,000.00 ₹ 14,42,000.00 Develop Detailed Design Specifications 396.0 ₹ 7,92,000.00 ₹ 1,00,000.00 ₹ 5,00,000.00 ₹ 50,000.00 ₹ 14,42,000.00 Develop Acceptance Test Plan 396.0 ₹ 7,92,000.00 ₹ 1,00,000.00 ₹ 5,00,000.00 ₹ 50,000.00 ₹ 14,42,000.00 Subtotal 1,980.0 ₹ 39,60,000.00 ₹ 5,00,000.00 ₹ 25,00,000.00 ₹ 2,50,000.00 ₹ 72,10,000.00 Develop Components 924.0 ₹ 18,48,000.00 NA ₹ 5,00,000.00 ₹ 50,000.00 ₹ 23,98,000.00 Procure Software 924.0 ₹ 4,80,00,000.00 NA ₹ 5,00,000.00 ₹ 50,000.00 ₹ 4,85,50,000.00 Procure Hardware 924.0 ₹ 12,00,00,000.00 NA ₹ 5,00,000.00 ₹ 50,000.00 ₹ 12,05,50,000.00 Development Acceptance Test Package 924.0 Included in above NA ₹ 5,00,000.00 ₹ 50,000.00 ₹ 5,50,000.00 Perform Unit/Integration Test 924.0 Included in above NA ₹ 5,00,000.00 ₹ 50,000.00 ₹ 5,50,000.00 Subtotal 4,620.0 ₹ 16,98,48,000.00 ₹ - ₹ 25,00,000.00 ₹ 2,50,000.00 ₹ 17,25,98,000.00 Subtotals 6600.0 ₹ 17,38,08,000.00 ₹ 5,00,000.00 ₹ 50,00,000.00 ₹ 5,00,000.00 ₹ 17,98,08,000.00 Risk (Contingency) 0.0 ₹ 3,47,61,600.00 ₹ 1,00,000.00 ₹ 10,00,000.00 ₹ 1,00,000.00 ₹ 3,59,61,600.00 Total (Scheduled) 6600.0 ₹ 20,85,69,600.00 ₹ 6,00,000.00 ₹ 60,00,000.00 ₹ 6,00,000.00 ₹ 21,57,69,600.00 ProjectDesign (3months) Project Development (6months) Cost Category Total Cost Average Inventory Carrying Cost (At depot level) 1,95,00,000.00₹ Operating Cost (Storage and Stock Management) 2,60,00,000.00₹ Transport Cost (To Operating Units) 65,00,000.00₹ Sub-Total (Incremental) 24,70,00,000.00₹ Pharmaceutical Land Acquisition Cost (Including the registration charges and duties) 19,50,00,000.00₹ Warehousing Incremental Cost Analysis
  • 7. Proposal 2: Quick Response Service (QRS) Total Slum enumeration blocks(SEBs) is about 108000 in India Slums Category: Notified: 37072 in numbers Recognized: 30846 in numbers Identified: 40309 in numbers Total slum households: 13.749 million Largest number of slums in Maharashtra: 21359 Most health issues with urban slums are associated with women and children Primary data Collected from Chennai, Bhubaneswar, Kanpur(150+ respondent): 42% of women had post delivery complications An severe anemia is a cause of high maternal mortality rate and Infant mortality rate(IMR) Since currently there are no primary healthcare centers in urban slums, there is a high need of providing easy and fast service.  63.5% households in slums are having mobiles (as per 2011)  We are proposing for a weekly Mobile Hospital Plan which are capable of providing primary healthcare namely generic drugs, Vaccines etc.  More frequent visits for Women and Child Care based on the information provided over telecommunication network.  Dedicated 24 x 7 helpline number should be provided for ease of access of the service.  To communicate the existence of the facility, We will be conducting rallies, camps and through media campaigns  Special preventive actions should be taken for diseases like Malaria, HIV, Flus etc. as these are the major cause of death tolls in slums  P-P-P Model should be aggressively implemented for Telemedicine : Apollo, AIIMS, Narayana Hridayalaya, Aravind Hospitals etc. few options. Reaching through Mobile Hospitals
  • 8.  The proposal will be launched in a test case basis in 4 states namely: Odisha, Maharashtra, Uttar Pradesh and Tamil Nadu  The States are chosen to represent 4 parts of the country and relatively larger slums and rural population percentage as per census data than other states. Analysis of QRS System Financial estimation of the pilot launch of the program  Larger and effective reach to remote places and places deprived of basic medical facilities in terms of primary healthcare  Easier and faster way to spread awareness  Saves expenditure and time of people who can not afford Medicare facilities, even the basic ones  Diseases that are treated traditionally due to its complexity can be brought into notice so that proper treatment can happen  Effective distribution of vaccination can be done. e.g. Polio vaccination No. of Panchayat Samiti (PS) 314 Each Mobile hospital will cater to 3 to 4 PSs (Assumption) Catering to 226 PSs (4:1 Ratio) 56 Catering to 90 PSs (3:1 Ratio) 30 Sub-Total 86 Vehicle 4,00,000.00₹ Equipment 6,00,000.00₹ Sub-Total 10,00,000.00₹ Total installation Cost 8,60,00,000.00₹ Calculation for State of Odisha No. of mobile hospitals Required Fixed Cost Calculation for infrastructure Variable Cost Calculation Petrol and Salaries (Per annum): Salary@5000 INR per driver per month and petrol@1000 per visit assuming 100 visits per annum 1,37,60,000.00₹ Advantages  Local recruitment and training of para-medical personnel through public-private partnership with organizations like Arvind hospitals, Apollo Group, AIIMS etc.  Outsourcing the transportation/mobility of the vehicles to transport agencies for better co-ordination and effectiveness  Partnership with medical equipment suppliers like General Electric Medical Sciences or Philips for supply and maintenance  Special department to be established for the proposed system How to achieve?
  • 9. Proposal 3: Securing Human Lives National Health Insurance Policy PROPOSED CHANGES IN THE RSBY SCHEME Total BPL population 22% 279.5 million Registration Fee Rs. 0 per household Expected no of people per household 5 Total no of households in BPL category 55.9 million Plan coverage Rs. 50000 per household per annum New Scheme for the people above BPL but Poor National Health Insurance Policy(NHIP) This scheme will help to cater the rest of the poor section of the population, who cannot avail the facility through BPL schemes but also don not have sufficient money to avail good medical services Total Population 120.5 million Total No of households 24.1 Proposed premium amt. Rs. 100 per person For a family of 5 Rs. 500 per household Mode of payment In 2 installments of Rs.250 each. The new insurance scheme should be launched in the UP, Maharashtra, MP and Odisha with highest no of poor public First instalment (DOP*) 1st- 5th April Valid Up to 31st September Second Instalment (DOP*) 1st- 5th October Launch the scheme phase wise in various districts with the help of NGO’s, locally active committees like Rotary club etc. to increase awareness about the scheme Valid Up to 31st March *DOP: Date of Payment Coverage Package Rs. 1,00,000 Part1 (million) Part2 (million) Total (billion) Permium earned Rs. 6025 6025 12.05 billion If all the people file medical claim Total Cost (Rs.) 2410 billion Facts and Issues  Only 11% of the population has any form of health insurance coverage.  It is estimated that 20 million people in India fall below the poverty line each year because of indebtedness due to healthcare needs.  The first ever general medical insurance policy by GoI in 1996-97was a major FAILURE due to:  The insurance was on a reimbursement basis  The claim of the insurance was lingered most of the time even up-to 1 year from date the application. ASSUMPTION:  All BPL and above BPL but poor will avail the policy having 5 members/family.  Rs. 100,000 as coverage for the poor section other than BPL.  Cost is given for 100% claims, though this is highly unlikely that all the insured people will file claim AMENDMENTS IN RSBY:  Since the cost of treatment has gone up, So coverage plan should be revised from Rs.30000 to Rs.50,000  The registration cost should not be collected from the BPL people  The selection of insurer & empanelled hospitals should be made for a bigger time period ADVANTAGES OF THE NHIP:  Medical insurance for every poor in the country  Improve the HDI by providing timely and effective medical care which earlier was not possible because of money  Reduce the no of people falling into poverty because of taking loans for medical treatment
  • 10. FACTORS MEDICINE DISTRIBUTION SYSTEM QUICK RESPONSE SERVICE NATIONAL HEALTH INSURANCE POLICY POLITICAL  Huge pressure on pricing of the drugs  Issue of more harmonization of healthcare systems across India  Acceptability of initial capital outflow and its approval in the political level  Huge political stand-point regarding PPP model in Indian healthcare insurance scheme ECONOMIC  The spend on healthcare per capital continues to grow in private expense  Low cost of innovation, manufacturing and operations  Cost benefit analysis of the infrastructure spending and challenge on the break-even attainment  Huge negative impact in health insurance models particularly where part payment is required.  Opening of the health insurance sector SOCIAL  Huge increase in domestic demand of generic drugs  Increasing aging population and health concerns  Problem of the increasing obesity amongst the population and its associated health risks.  Awareness about the mobile hospital concept among the poor and the rural people  Dealing with the beliefs of the people about the effectiveness of the system  High level of social dis-belief regarding paying insurance premium without availing the benefits for years if not needed. TECHNOLOGY  Outsourcing of clinical data management may trigger threat to the effectiveness of the system.  Opportunities in terms of: a. New info and Communications technologies. b. Social Media for Healthcare. c. Customized Treatments. d. Direct to Patient Advertising. e. Direct to patient communications.  Challenge of in-house procurement of the medical equipment and outsourcing of the same to external vendors.  Proper trained staff/para-medical personnel for handling and operating the equipment giving quality treatment to the people.  Huge challenge in managing database for all the genuine candidates for the scheme  Data integration and security issue in terms of claimant amount and quick and effective transfer of service to the needy ENVIRONMENT  Presence of more unorganised players versus the organised ones  Growing environmental agenda and community awareness  An opportunity to incorporate it within their Corporate Social Responsibility programmes  Huge scope of business for both public sector and private sector companies due to a wide market segment LEGAL  Import duty on foreign trade in pharmaceutical products.  Huge export may pose challenges on domestic demand-supply equation.  Trade Related aspects of Intellectual Property Rights (TRIPS) have an adverse impact on pricing of pharmaceutical products.  An ever growing culture of litigation across Indian subcontinent.  Proper validation of applicants during registration to the scheme.  Stake of private sector companies in case of PPP model implementation in insurance domain.  Low public expenditure and high government involvement in investment policies PESTEL Analysis Challenges, Risks and Factor Analysis
  • 11.  India being one of the most populated subcontinents in the world with very high population density we would have to ensure proper distribution system in terms of medicine and other medical facility.  For ensuring availability of medicine as per requirement, the proposed National Medicine Policy would not only bring in efficiency but also will lead to a transparent and sustainable medicine distribution system.  Reducing IMR and MMR will help India in improving its HDI ranking  Considering India to be an emerging economy with increased technological adaptation, a proposed paradigm like QRS would lead to better access to emergency medical facility which is the need of the hour.  As the per capita income is also growing, the applicability of health insurance scheme can't be ignored any more. Hence, with the wide adaptation of health insurance schemes it would be easier on the part of both the general public and government to bear the cost of health care facilities. For this, government has to increase its spending on healthcare sector by 2% of the GDP to accommodate the increase in cost structure.  By cutting on the cost incurred by people on the medical care, they can now invest more on other things like food, education etc. After all, government should not consider these options as a source of income; rather a good investment for a better future.  Lastly we would propose increased focus on preventive measures in order to ensure a healthier breed in coming future. For this we should spread awareness related to yoga and Ayurveda which is not only cost effective but has been proven effective in many instances. Institutionalizing yoga would not only ensure health but also would lead to lower healthcare liabilities on Governments' part to bear for. Sound mind lives in a healthy body. Thus by implementing all these, we can put a step closer for making India a better place to live, because after all Sound mind is a necessity for a country to grow. Conclusion Towards a better India
  • 13. • http://www.oracle.com/us/corporate/pricing/fusion-applications-price-list-418746.pdf • http://www.oracle.com/us/corporate/pricing/exadata-pricelist-070598.pdf • http://www.dnb.co.in/SME_cluster_series2012_Indore/PDF/IndustryOverview.pdf • SWOT analysis of Indian pharmaceutical industry by Kapil kumar, research scholar, Bhagwant university, Ajmer and Dr. M. K. Kulshreshtha, director, s. d. college of management, Panipat • Ministry of Health and Family Welfare Government of India. "Financing and Delivery of Health Care Services in India." 2005. Web. 30 Apr. 2012 • "Rashtriya Swasthya Bima Yojana." Rashtriya Swasthya Bima Yojana. Web. 30 Apr. 2012. http://www.rsby.gov.in/. • World Health Organization. "National Health Accounts in India." 2005. Web. 30 Apr. 2012 • Priya Shetty, “Health care for urban poor falls through the gap”, The Lancet, Volume 377, issue 9766, page 627-628. • Indian Health Industry, DINODIA Capital advisors, November 2012. • Health of the Urban Poor in India, UHRC, March 29, 2007. • Analyzing and Controlling pharmaceutical expenditures, Chapter 40, Planning and Administration, Management Control System. • Infant and Child mortality in India, National Institute of Medical Statistics, Indian Council of Medical Research • Emerging Market Report: Health in India 2007, PricewaterhouseCoopers • Jan Swasthya Abhiyan, Universalising Health Care for All, November 2012, Published by Amit Sengupta, on behalf of Jan Swasthya Abhiyan, and Printed at Progressive Printers, 21 Jhilmil Colony, Shahdara, Delhi. • Coverage plan for BPL population, Government of India Publication Appendix and Sources