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Avi Batra BBA Semester I

Roll No. 4501/09

Parameters Influencing the Choice of a Hospital by Patients

Submitted in partial fulfillment of the requirement of the award of the BBA Degree

Birla Institute of Technology

Acknowledgment
For any research project to be successfully executed and taken to its logical conclusion, it is vital to have detailed knowledge, not only of the subject but also the overall industry perspective. My teachers at BIT have always been a source of inspiration and I owe all that I have learnt of the practical aspects of management, to them. Their constant goading, invaluable encouragement and occasional criticism have helped me developed as in individual and hopefully, as a fine manager tomorrow. A special word of thanks to my family members for their active encouragement.

( Avi Batra )

I N D E X

Section Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

Contents Executive Summary HealthCare in India Survey Design & Execution Data Analysis Data Interpretation Limitations Utilization

Annexure A

Questionnaire

E x e c u t i v e

S u m m a r y

The present project has been undertaken to gain insight into the factors which influence the mind of a present / prospective patient and / or his family members, while deciding upon a medical institution. Healthcare is one of Indias largest sectors, in terms of revenue and employment and is expanding rapidly. During the 1990s, Indian healthcare grew at a compound annual rate of 16%. Today, the total value of this sector is more than $34 billion (approx. Rs. 170,000 crores). This translates to roughly 6% of the GDP. By 2012, Indias healthcare sector is projected to grow to nearly $40 billion (approx. Rs. 200,000 crores). The private sector accounts for more than 80% of total healthcare spending in India. India is very well placed to tap the growing potential of the healthcare sector. It has the relevant skill-sets with adequate human resources to become the preferred healthcare player in emerging countries across the globe. Increasing urbanization, superior demographics, better health consciousness and higher life expectancy has enhanced the demand for quality healthcare. Consequently, the discerning Indian patient has begun to demand quality healthcare and is becoming increasingly choosy of both, the medico-technical and human aspect of medicare. Under the circumstances, corporate hospitals will do well to understand the current trends of patients preferences and provide services accordingly. This is an humble effort in that direction of identifying the preferences.

HealthCare in India

H e a l t h C a r e Preamble

i n

I n d i a

Healthcare is one of Indias largest sectors, in terms of revenue and employment, and the sector is expanding rapidly. The private sector accounts for more than 80% of total healthcare spending in India. Unless there is a decline in the combined federal and state government deficit, which currently stands at roughly 9%, the opportunity for significantly higher public health spending will be limited.
Growing population and economy

One driver of growth in the healthcare sector is Indias booming population, currently 1.15 billion and increasing at a 2% annual rate. By 2030, India is expected to surpass China as the worlds most populous nation. By 2050, the population is projected to reach 1.6 billion.
What is driving the sector?

The increase in expenditure by government towards enhancement of medical facilities is a big plus, as is the involvement of large corporate houses. The reduction in customs and excise duties on various items is proving to be of great help to the sector resulting in the formation of the healthy competition. Constant research and development have led to the discovery of new and better life saving drugs while the development of infrastructure and various incentives provided by the government is proving to be a great booster. The government has also come up with various insurance schemes, which could help the sector and this is aided by the formation of various institutes, which have given the country the best of the doctors.

Where are the roadblocks? One of the biggest roadblocks is the fact that the cost of many of the required equipments in this segment is too high. Resultantly, small healthcare centers cannot afford them and lag behind. Similarly, many people are unable to enjoy the benefits of the new and advanced technology as the cost of treatment by this advanced equipment is very high. Finally, there are many dealers in the market who dupe people by selling them outdated medicines. However, the government is using legislation to place serious curbs on this malpractice. Notwithstanding proliferation in the urban areas, the lack of good healthcare facilities in the backward rural areas is a cause of concern. It is undisputable that the total available healthcare centers are lesser in number than required. Finally, though there has been a reduction in duties, there have also been certain changes in the excise norms, which affect pharma companies. The road ahead Healthcare is a fast-growing sector which is developing at a very fast pace. People are becoming health conscious and are demanding better quality healthcare measures. Many hospitals have been formed for the purpose of providing quality healthcare to the people. Huge investments are being made in R&D which has led to development of new and better life saving drugs and equipments. The government has reduced certain duties, which has brought down the cost of various drugs and equipments. There has been a constant focus by the government on the development of the healthcare sector. The future of this sector looks bright and promising. Both, the government and private sector enterprises are joining hands to boost the Indian healthcare sector. Overall, the prospects appear very bright and reflect the old adage 'Health is Wealth'.

S u r v e y

D e s i g n

&

E x e c u t i o n

A questionnaire was designed to include various facets considered important, while taking a final decision of the choice of hospital. To ensure the applicability / correctness of the same, the questionnaire was taken for preview to 2 hospitalbased doctors, whose suggestions were incorporated. From the wide list of possible parameters, the group zeroed-in on 10, which were included in the final questionnaire (refer Annexure A). To ensure a statistically significant sample size, it was decided to get answers to these queries from 80 people, across the following variables: Gender Educational background Income groups For further reference, the age was also recorded, though not used for processing data. For the convenience of people recording their response, the Multiple-Choice pattern was given, as it was felt that people would be hesitant to think and then write their answers and would find it convenient to give a range against the options offered. As the survey was being done with people holding a graduation degree (at the least), the language / content was not made overly simple and almost everybody was able to comprehend the context and respond accordingly. It was made sure that the responses were recorded in the presence of the team members, so that clarifications, if any, could be given right at the time and directionally correct responses recorded.

The questionnaire was then circulated within the group and collectively 77 responses were assimilated. The profile of respondents covered a wide gambit of professionals, including junior level executives, mid-level managers and senior members of the management. Due care was taken to ensure that all respondents were responsible for taking such decisions for self / family members and their opinions carried weight in such family matters.

D a t a

A n a l y s i s

As per standard statistical technique, the following steps were undertaken to analyzed the responses: Step 1 The number of respondents giving Priority # 1 to the first parameter (A particular doctor from the specialty you want to consult) was plotted in the Excel Sheet. Likewise, the number of respondents giving Priority # 2 10 was plotted in the subsequent columns. Step 2 The exercise was repeated for all 10 parameters Step3 Weights were assigned to each parameter in descending order, i.e., Priority #1 for the first parameter was assigned a Weight of 10, Priority #2 was assigned a Weight of 9 and so on Step 4 Using the Excel spreadsheet, the count of respondents giving individual priority 1-10 were multiplied by the respective weights, to arrive at the Total Score Step 5 A pie-chart of the Total Score was then plotted to arrive at the parameters influencing hospital choice, as per weights-based Priority Rating

Step 6 Parameter 1 was then analyzed in greater detail, by plotting the percentage of respondents assigning Priority # 1 to the same. Similarly, the percentage of respondents assigning Priority # 2 10 was plotted and a histogram was generated

Step 7 The exercise was repeated for Parameters 2 - 10

D a t a

I n t e r p r e t a t i o n

From the analysis of data, it was obvious that customers had a clear mental priority in their minds. The sizeable majority was in favor of getting referred to a specific doctor, irrespective of his / her location. This can be easily understood a reputed Cardiac Surgeon like Dr. Naresh Trehan is a brand in his own right. When he was attached to Escorts Hospital and Research Center, patients from all over the country were flocking because of his individual image and track record. When he shifted to Apollo Group of Hospitals alongwith his team, patients started consulting him there. The clear prioritization emerged as follows:

Parameter A particular doctor from the specialty you want to consult Brand image of the hospital Level of cleanliness Distance from your residence Tie-up with your medical insurance company (if having insurance cover) OR Likely expense for hospitalization (if no coverage) Behavior / handling by paramedical staff On- campus availability of diagnostic / screening infrastructure In-house pharmacy Boarding / lodging arrangements for attendants Recommendation from friends / relatives

Total Score

Ranking

596 538 521 460 440 414 389 310 301 294

1 2 3 4 5 6 7 8 9 10

The analysis of the percentage of respondents giving a designated priority rating to each parameter revealed an interesting mindset, which had logical explanation, thus confirming the veracity of the survey: Parameter: Preference for specific doctor As many as 48% respondents clearly opted for preference for a specific doctor as Priority #1 (explained with Dr. Trehans example above) Parameter: Behavior / Handling by paramedical staff None rated this parameter to be at Priority #1 and the bulk of respondents (24%) rated the same at Priority #5. Interestingly, priority ranking # 3 was polled next highest (20%) Parameter: Boarding / Lodging arrangements for attendants Expectedly, the highest percentage of respondents (32%) rated this parameter at Priority #6; clearly indicating that patient welfare was predominant over secondary issues like comfort of the attendant Parameter: Brand image of the hospital This parameter scored the highest at Priority #3, signifying that any medical institution will need to focus upon the perceived brand image as a vital factor Parameter: Distance from residence Low priority was accorded to this parameter; with Priority #6 being polled by a high of 24% respondents may be erroneous if the nature of medical requirement is considered e.g. a cardiac emergency / roadside trauma may warrant giving the highest priority to the vicinity of the medical facility Parameter: Facility of in-house pharmacy Expectedly, the highest percentage of respondents (28%), assigned low-end Priority #9 to this parameter as it appears that the need for all emergency drugs would be met by the hospital store itself. For additional requirements, the attendant would manage from the retail pharmacy in the vicinity.

Parameter: Level of cleanliness Increasing customer satisfaction was clearly reflected by the fact that nearly 2/3rd of respondents cumulatively assigned a high priority rating to this parameter (Priority #2-4)

Parameter: Availability of diagnostic / screening infrastructure It appears that respondents did not understand the significance of this parameter, as the highest percentage (20%) gave it a low priority rating (#7). In cases of hospitalization for severe illness, it is desirable that screening facilities like MRI, CT Scanning etc. are available in-house, to avoid transportation of patients.

Parameter: Recommendation from friends / relatives This parameter recorded a low priority, with the highest percentage (28%) being accorded at Priority #8. It is obvious that patients / family may get various options from their friends, but the same does not rank high on the decision-taking list.

Parameter: Medical Insurance Empanelment With almost everyone having a medical insurance cover, the empanelment of a said hospital with the particular insurance company ranks high, with the highest percentage (24%) rating it at Priority #2, after the choice of a specific doctor.

L i m i t a t i o n s Like with all opinion-based research assignments, this survey appeared to have some limitations: The list of parameters is obviously not exhaustive and more work needs to be done in this direction Respondents were asked to list out any other parameter they considered important, but the same was not included the survey. Some interesting & useful parameters emerged: o Availability of ambulance pick-up / drop service o Reward points for repeat utilization of hospital services The gender-based and age-linked prioritization needs to be done, so that more specific results and interpretations are arrived at A larger population base needs to be covered to examine if the same influences a shift in prioritization Spread of the survey to Class II & III towns should be undertaken

U t i l i z a t i o n Such surveys would be of tremendous help to the HealthCare Service Providers (HSPs) like Hospitals / Research institutions / Market Research organizations etc., for better understanding of customer preferences. The survey clearly shows that patients are now demanding more and wanting Value-for-Money from the HealthCare sector. More exhaustive exercises done on this front will enable the HSPs to address the specific needs of the patients / families much better and channelize their investments / expansion plans in the right direction.