Presented By:

Group No. :- 05
Group Members:
CASE  Adarsh Kumar Mishra (110005)
 Avinash (110013)
SOLUTION  Kalyani (110021)
 Mona Ranjan (110029)
 Prayag Pushkaram (110037)
 Rohit Kumar (110045)
 Siddhant Ranjan (110053)
1. How focused factory model suitable for
healthcare? Compare and contrast the focus
factory of Health Care Global(HGC) with
other such factories in US.
 Focused factory model is the model that mainly focuses on narrow range of
products. The factory that is simple and mainly focus on one or two key tasks.
 In case of Health Care Global, it acted as the focussed factory as one stop shop
for its patients.
 Its main focus was on the treatment of cancer and it main aim was to provide
treatment on rural and urban areas. It covered every speciality and sub- speciality
for both child and adults.
 For its treatment it focused on providing services including imaging, treatments
and laboratory.
 It owned chain of pharmacies that offer a distributer or retailer price to the
customers that allowed low-income patients to benefit from well- tested generic
drugs.
 In this way we can say that the focused factory model helped in improving the
healthcare.
Compare and contrast the focus factory of Health
Care Global(HGC) with other such factories in US.
Salick Health Care

It was founded by Dr. Bernard Salick.

 This organization break the treatment into inpatient and outpatient care.
 The outpatient segment was provided by his cancer centres.
 Bone marrow transplants and other similar complex procedures were
demarcated as inpatients procedures.
 This model provides training to families to meticulously treat and use
procedures.
 Training families not only ensured a patient centric approach but also in a
reduction of hospital costs without compromising care.
 Cancer Treatment Centers Of America
 It was founded by Richard J Stephenson.
 It was set up as a focused factory in which two thirds of the patients had complex
late-stage cancer.
 Every detail of patient care process was overseen by CTCA.
 It took care of all the airline reservation for the patient and one family member.
Dana-Farber Cancer Institute
 It was the non-profit cancer institute providing multi-disciplinary clinics for every
speciality and sub-speciality of adult and child cancers.
 It provided outpatient cancer care while its partners provided inpatient care.
 Medical radiation oncologists were employed full time by Dana-Farber while
surgical oncologists were employed by its partner hospitals.
2. Trace the status of cancer health care
in India before and after 1990.
Before 1990
• Before 1990 early detection and treatment were a major bottleneck to reducing
cancer-related mortalities.
• More than 0.9 million new cases of Cancer occurred annually with more than
9.4 million prevalent cases recorded and 0.4 million deaths and out of 1.25
billion people.
• India before 1990 had a shortage of hospital beds less than one-third of the
WHO norms.
• Cancer care was considered as a service that should be provided by
government or trust hospital due to a widespread belief that Indian patient
could not afford a specialised cancer care service.
• The condition of government hospitals was poor and lacks infrastructure and
usually has a long waiting period due to excessive demand.
• The regulation was also a barrier to using radiation equipment like linear
accelerators which were new to India.
After 1990
 After liberalisation new private player entered the market which was resisted
by public hospitals.
 HCG started to expand operation creating Healthcare Global Enterprises
(HCG) a holding company, they choose a hub and spoke expansion model.
 Technology has been utilised to its benefit across its network telemedicine
give the Spokes access to hub doctors.
 Introduction of advanced technologies like linear accelerator, Cyberknife,
modulated radiotherapy etc and treatment specialities (medical, radiation &
oncology) helped in early detection.
 Telemedicine, teleradiology and telephysics were provided to hospitals
outside its geographic scope, such as ruler areas and other emerging market.
3.Comment on the hub and spoke expansion model
adopted by HCG in India. What were the challenges/
entry barriers faced by HCG during establishing its
operations in India?
HCG “hub and spoke” expansion model was key to its value
proposition.
Hub – Hospital providing three treatment specialities (medical,
radiation and surgical oncology) with high end technology. Located in
Bangalore and Ahmadabad.
Spoke – Chemotherapy centre providing basic therapy and follow-
ups. Located in small cities and town.
Spokes provided localised services to patients in collaboration with
hubs.
Spokes were decided with environmental scan of the area, assessing
cancer incidences, market size, availability of medical expertise,
insurance.
Faced the complex elongated procedures from Local bureaucracies
to obtain permission for land, electricity, and other basic needs
Corruption among government officials
Financing challenges for his technology-intensive model.
Receivables were also a challenge – government payers took
significantly longer than usual to pay
Indifferent investors due to low profitability.
Regulation to using radiation equipment like linear accelerators.
4. What steps did HCG take to ensure
high quality of its services ? Comment on
HCG’s CSR efforts.
• Both physics (planning of radiation function) & pathology (Study &
diagnosis of a disease) were centralized.
• Through centralization, a team of highly qualified physicists could
design a complex plan for patients in spoke hospitals
• In centralized pathology, the diagnosis and treatment strategy was
controlled by HCG’s highly specialized hub doctors
• The procurement for drug was also centralized.
 CSR Efforts

• HCG Foundation was formed. The foundation raised funds by theatre, art
auctions, dinners and other fundraising events.
• HCG employees were encouraged to give their 0.5-1% of the salary to the
foundations.
• HCG did not turn away any patients even if the patient could not afford to
pay.
• It also contributed 5%-8% of its top line towards these discounts and free
treatments.
• Persuaded suppliers to give free drugs for poor patients.
• HCG assigned medical social worker to each patient.
• HCG conducted camps to create awareness about cancer .
5. What effect did the changing insurance
landscape in the country have on HCG’s
operations?
Government insured people below poverty line.
 40% of HCG patient’s were insured.
 40% of HCG’s patients were insured out of which 15 % were
government and 25% were private insurance
 Government is poor in reimbursement.
 “Arogya Shree” paid 70 % less than private insurers.
 Usually government payments were received after 6 months of
claim.
6. How did the Human Resources Model of
HCG help ensure success of the
organization?
• Human resource model established relationship between nursing
schools and medical colleges by recruiting more than 2,000 staff
members.
• HCG also attempted to resolve the problem of quality medical care in
rural areas of India by stationery specialists at the hubs.
• Prioritise recruitment through management schools for full time
strong managers.
• In- home care provision protocols, HCG also tried to shift care to
patients’ home.
• Same salary was offered to doctors to came back India from foreign
nations.
• HCG also innovated its in house training programs for nurses by
creating new cadre of nurses to sense cancer patients “onco- nurses”
7. Comment on the financing model of
HCG and its financial performance.
Revenue growing at the rate of 70% CAGR (Compound Annual Growth
Rate)
EBITDA at rate of 115%
EBITDA margins were inching towards 20%
Costs were cut down with centralization and scale purchasing.
Maximum use of technology. Linear accelerator were operated whole
night to ensure full usage.
Prescribed generic version of drugs. Persuaded suppliers to give free
drugs for poor patients.
They directly connected with the manufacturers to get low cost rates
New centres take $4-$10Mn to set up as per scale. Cash breakeven is
around 2 years.
Physicians partnered in creation of new spokes owned 20% equity in
company. Dr. Ajaikumar retained 26% of equity.
8. What recommendations do you have for Dr.
Ajaikumar for expansion in India with an IT focus?
Should Dr. Ajaikumar go ahead with his plans of
setting up cancer centres across Africa?
• YES! Of course, Dr. Ajaikumar must expand in India with focus in
IT.
• Technology can be well used for collection of data, understanding
patients genomics, stages of disease leads to create a bio repository.
• When patients comes back with a recurrent disease they can go back
to bio repository to recheck the genomics and finds the reason and as
per this can change in therapy, if any.
• Right treatment at right time through integration of technology and
prescribed medicines helps doctor in proper analysis.
Cont..

• Yes, he should go ahead with his plan of setting up cancer centers

across Africa in coming years.
• He should go for partnership with common wealth development which
is arm of British govt.
• Establish corporation in Mauritius which will drive the African
initiative not only in terms of setting up clinics but also starting actual
centres due to unmet demand of centers to establish.
• For awareness regular medical camps in East Africa through check
ups.
Cont..

• Role of govt is very limited just only to perform online registration.

• Marketing of their services can be done through local consultants,
insurance groups and health check up plans.
• HCG provides travel, insurance and financial services to their patients.
• Have capacity to deal with corruption as in India well handled the
situation of corruption.
• Corruption issue- problem in getting permission of land, electricity
and other needs, allied with honest politician & conducted string
operations.