The Good, The Bad & The Healthcare Industry


I got the opportunity to converse with a former administrator for a hospital. I am restraining from citing my source, because of the nature of the questions asked and information shared. This is by far the most thought provoking and intriguing interview I have been able to record.

My interviewee is an MBA graduate with a major in accounts and holds 10 + years of experience in the Indian health care industry. Our conversation went as follows –

Do you look at the hospital as a business or a social commitment?
In my opinion, the basic purpose of healthcare is to provide services to all those in need of medical attention, using the most affordable and available resources. Unfortunately, be it private or public as an organization the industry cannot be self-sustainable and has the necessity to generate profits. Also, on an average many medical providers invest a lot in training to become a provider and work for a hospital, hence a return on their investment is justified.

How prevalent is the problem of counterfeit drugs? 201036wbd001
Most of the hospitals have their own quality check. However, because of the commission offered to individual consultants and pharmacists by drug companies and medical sales representatives, there are institutes and providers willing to compromise their ethics to mint additional income. In rural areas of many states, although, government provides free drugs, patients still do not have accessibility to these drugs, neither do they receive sufficient quantity. On the contrary, quacks are accessible even in the rural, and are able to serve to the patients. Unfortunately, patients are not educated enough and rest their belief in the quacks and fail to differentiate between a quack and an authorized doctor.

Every hospital has a continued medical education (CME), but there is no implementation on grass root level and also it’s not taken that seriously by hospital management. There are no teachers, there aren’t enough doctors teaching new techniques. Recruiting teachers is not prioritized. They do not see it being productive. Training programs are provided only when there is an up-gradation. Very few hospitals have on-going training.

Government always purchases authentic drugs because of the auditing board, but they fail to disperse these in time. Often fifty percent are expired and remain in the inventory. The government does not have enough manpower to make these drugs available to medical practitioners in time. Because of which, the quacks and counterfeiting still exist.

How can the government regulate counterfeit of drugs?
Regulatory bodies have all power to stop quacks from practicing, but fail to do so. Although, there is a regulatory body, there isn’t enough manpower and the regulators enjoy mutual benefits from these quacks which include medical and political benefits.

What can change?
Rashtriya Swasthya Bima Yojna (RSBY) is a great concept, but many hospitals are not willing to register. RSBY supports free treatment to the needy, having said that, government also fails to reimburse the claim amount to the providers for years. Because of which, individual hospitals are forced into using their reserve amounts to pay the consulting medical providers – piling up a heavy backlog under accounts receivable for RSBY. Hence, many hospitals are withdrawing from the scheme. If this scheme is given the importance it deserves and if a dedicated team is provided to clear backlogs, it has the potential to become a game changer for the Indian health care industry.

Is there a mechanism in place to control counterfeit drugs?
Every state has a central drug standard control organization (CDSCO), they conduct periodical checks in pharmacies and hospitals. They check if the drugs are authentic and if they are stored and dispersed as prescribed. They also audit the drug committee in hospitals. Pharmacists have replacement drugs which are inexpensive compared to the prescribed ones. The CDSCO does not have knowledge about these replacement drugs, because they are never on display. This is mostly practiced by pharmacies which are out sourced by individuals or companies. Hence, the pharmacies in the hospital are expensive, because hospitals prefer purchasing drugs from reputed makers and as per the industry standards. Doctors en-cash on this opportunity, by referring patients to the pharmacies which offer these replacement drugs. Although, there is a mechanism in place it is not efficient enough.

3309888339_3d45cee4f8Why is healthcare not an attractive employer?
Doctors are presented as an entity larger than reality, and they overshadow all the other workers. As an organization, a hospital is no different to any other business. Doctors are key players but there are other personnel’s involved in running hospitals and their contribution to the success of a hospital is very important. There is more to a hospital than the doctors, there is finance, procurement, stock and inventory, HR, housekeeping, sales and marketing, public relations, project development, publicity and advertisement, liaison and the legal department. Without the support from all these departments, a smooth transaction between a doctor and a patient cannot be achieved. It’s a very challenging job to accept – both physically and emotionally, and I always encourage aspiring applicants, if given an opportunity one should go through this experience – it’s simply awesome!

How effective is marketing in the healthcare industry?
Healthcare is no different from any other business, marketing and sales play a key role in
establishing a successful facility. Hum do humare do and the AIDS campaign was such a big hit, government should work on many such campaigns and educate the community. It is a very complex and sensitive process, but we need more of these.

Which of your strategies have proven to be most effective?
My priority is always the patient wait time, it is important to keep the patient wait time very low, doctors should always be available. We try to maintain an average of 3minutes as the wait period, in case we fail, we offer our patients a complimentary food coupon. The coupon could be redeemed in the hospitals dietary. With this strategy we were able to build our good-will by establishing a rapport with the patients. My team tries to make every patient feel important. We recruited interns from hotel management, and learned from them how to make every patient (visitor) feel important and special. We conduct a market research on every recruit before making an offer. We conduct an intensive and highly detailed background verification on our doctors. I also, had to take the best doctors out for dinner, to convince them to serve at our facility.

Is treatment in government hospitals really free of cost?
Government hospitals might have all the materials required for an operation or treatment, irrespective, most of the doctor’s order patients to purchase materials from a private – independent pharmacy. Surgeons conduct surgeries late night. On the surface they claim free treatment but make a commission from the pharmacist. The doctor gets the stock issued from the hospital, and shows it as utilized for the patient. And sells the stock to the pharmacies. By the end patients end up paying as much as they would in a private hospital.

What motivates you to work in this environment?
I got the opportunity to work with few providers who are truly dedicated towards servicing patients and provide to the best of their capacity. There are medical providers who work to make money, there is nothing wrong in this, but one should maintain a certain honesty. Even if I am able to serve a single patient and am able to see one say good bye with a smile – it is worth the crazy ride. I take immense pride in my industry.

              Although, my interview ended in two hours, I kept thinking about our conversation for rest of the evening. It is fascinating to me how ultimately business can take over humanity. Will the industry ever be able to establish and follow a standardized ethical code of conduct, or, will we continue to barter commerce for life?