LifeSpring Hospitals: A Chain of community level hospitals providing affordable quality healthcare to working poor in India.
LifeSpring hospitals are a chain of small sized private hospitals providing services to its customers which are :
(a) Efficient (because of better management system/processes)
(b) Fair & affordable Price of services ( no ambiguity/surprises in the prices of the services)
(c) Better Outcome (because of focus on clinical quality)
(d) Personalized service (because we treat our “patients” as customers/guests and not as patients.)
LifeSpring hospitals primary customers are women from the working poor class.
About You
Location
Project Street Address
Project City
Project Province/State
Project Postal/Zip Code
Project Country
Your idea
Focus of activity
Service/process
Year the initiative began (yyyy)
2005
Positioning of your initiative on the mosaic diagram
Which of these barriers is the primary focus of your work?
Health care not consumer friendly
Which of the principles is the primary focus of your work?
Center consumers in business model
If you believe some other barrier or principle should be included in the mosaic, please describe it and how it would affect the positioning of your initiative in the mosaic:
This field has not been completed
Name Your Project
LifeSpring Hospitals: A Chain of community level hospitals providing affordable quality healthcare to working poor in India.
Describe Your Idea
LifeSpring hospitals are a chain of small sized private hospitals providing services to its customers which are :
(a) Efficient (because of better management system/processes)
(b) Fair & affordable Price of services ( no ambiguity/surprises in the prices of the services)
(c) Better Outcome (because of focus on clinical quality)
(d) Personalized service (because we treat our “patients” as customers/guests and not as patients.)
LifeSpring hospitals primary customers are women from the working poor class.
Innovation
Define the innovation
LifeSpring hospitals are a chain of small sized private hospitals providing services to its customers which are :
(a) Efficient (because of better management system/processes)
(b) Fair & affordable Price of services ( no ambiguity/surprises in the prices of the services)
(c) Better Outcome (because of focus on clinical quality)
(d) Personalized service (because we treat our “patients” as customers/guests and not as patients.)
LifeSpring hospitals primary customers are women from the working poor class.
Context for Disruption:
It is estimated that approximately 29 percent of the Indian population lives below the poverty line (World Bank 2003). This figure accounts for more than 290 million people, or nearly 25 percent of the world’s poor population. The effect of poverty on health care—and vice versa—is significant. Studies have shown that the poor in India are disproportionately affected by disease and have limited access to adequate medical services. Although India has made significant strides toward improving the overall health condition of its people, a substantial unmet demand for basic health services remains. Facility surveys in various states have recently estimated that the private sector includes as much as 93 percent of all hospitals and 64 percent of all beds nationwide (World Bank 2001). This remarkable growth in private sector health services has occurred largely by accident as the private sector has stepped in to meet needs that the public sector could not address.Majority of the private sector institutions are single doctor institutions with very little infrastructure or paramedical support.
Providing health care for the poor means focusing on areas that most strongly affect the poor. Coverage levels diverge widely between the richest and poorest segments of society with respect to key interventions, such as antenatal care provision, contraceptive prevalence, and institutional deliveries. The poorest population quintile has fertility rates of 4.1 children per woman, and the richest quintile has fertility rates of 2.1 (World Bank 2003). Increased fertility only increases the level of poverty caused by the increased financial burdens that accompany larger family sizes.
Therefore there are three broad needs identified:-
- Need to Reduce cost,
- Need to Improve quality. &
- Need to focus on maternal and child health care.
LifeSpring Hospitals aims to position itself by meeting the above mentioned gaps in the Indian Healthcare Sector.
Delivery Model
The delivery model is based on setting up a chain of LifeSpring hospitals across India primarily focused on working poor population in urban slums.
(a) Setting up small sized mid market hospitals : Hospital facilities with fewer than 30 beds account
for nearly 84 % of private for- profit sector and this sector also happens to be the most unorganized with most of the facilities managed by individual doctors. LifeSpring hospitals would focus on this segment by setting up hospitals with 20-25 beds.
(b) Affordable health care : The pricing of the hospital services have been kept between 30-50 % of the prevailing market prices, for eg. LifeSpring charges only Rs. 1499.00 ($ 35) for a normal delivery compared to a average prevailing market price of Rs. 5450.00.($ 120)
(c) Quality of health care : Standard quality protocols have been developed for provision of healthcare services . Some of the key protocols used in LifeSpring hospitals are (a) Access, Assessment and continuity of care (b) Patient Rights and Education (c) Care of Patient (d) Management of Medication (e) Hospital Infection Control (f) Facility Management and Safety (g) Human Resource Management (h) Hospital Operation System, and (i) Hospital Clinical System. LifeSpring hospitals are also in process of acquiring ISO 9001-2000 certification for standardization of all processes in the hospital.
(d) Focus on maternal and child health care service : LifeSpring hospitals primary customer are be women and her children. The key services provided in the hospitals are antenatal care, postnatal care, deliveries , family planning services, Medical termination of pregnancy, pediatric care including immunization, diagnostic services & pharmacy.
(e) Leveraging Information technology : LifeSpring hospitals are in process of setting up datacenter and linking all existing and new hospitals with it.
Key Operational Partnerships
(a) Medical Equipment vendors: We are developing tie up with national and international vendors for supply of Medical equipment. The tie up at national and international level would also help us in negotiating a better price for our hospitals, leveraging the economies of scale.
(b ) Nursing Training Institute: It is also pertinent to note that in the next ten years the requirement for doctors, nurses and other para-medical staff in the country is expect to record tremendous increase. According to an estimate, about 350000 additional nurses would be required in the country by 2015. Keeping this in mind, we are developing strategic tie up with Nursing Colleges across India to source nurses for our hospitals.
(c) Union & State Governments: We are also developing tie up with various state and central government health schemes. LifeSpring hospitals would also be used for routing Government schemes to patients who are below poverty line. A number of centrally sponsored schemes currently operational like Janani Suraksha Yojna (Mother protection scheme) would be linked with the LifeSpring network. Innovative schemes implemented by the state Government like voucher scheme would also be linked to the network.
(d) Mobile Health Clinics and Emergency transportation network: To improve the reach of the hospital services, LifeSpring hospitals we are networking with sponsored mobile health clinics and emergency transportation system.
Impact
Financial Model
The LifeSpring hospitals is a self sustaining model. The hospitals would turn cash positive in 21 months and the payback is in 4 years.
We charge for the services provided in the hospital. The charges of the services provided are based on:
(a) the internal costing of the services: LifeSpring uses a very strong cost control system where all the important key cost elements are tracked and analyzed on a monthly basis.
(b) Internal cross subsidization: As a part of over all financial sustainability without losing focus on lower income class customers, LifeSpring also have private and semi private rooms. The business model provides collection of competent prices (which are lower than the prevailing market prices) from the sharing room / private room customers, insurance and corporate clients enhances the sustainability of business model.
(c) market prices : We also benchmark our charges with prevailing market prices to ensure that our charges are competitive and affordable for target population.
(d) Innovative revenue sources : We also identify innovative revenue sources for augmenting the revenue of LifeSpring hospitals.
What is your annual operating budget?
$2M
What are your current sources of revenue? (please list any sources that are foundation grants)
We do not receive any grants from foundations/donor agencies. The project cost has been met by Hindustan Latex Ltd.
Effectiveness
LifeSpring hospitals have been effectively reaching out to its target customers.
(a) Income profile of our customers:-
We have been effective in reaching out to our target customers. The income profile of our customers shows the following:
(i) Daily wage earner : 34 %
(ii)Petty business : 16 %
(iii) Private trade : 34 %
(iv) Others : 16 %
(b) Education profile of our customers
(i) No formal schooling : 22 %
(ii) Below class X : 23 %
(iii) Class X : 19 %
(iv) Intermediate education : 12 %
(v) Graduate : 18 %
(vi) Post graduate : 6 %
(c) Saving to consumers
LifeSpring hospitals would be resulting in significant savings to customers due to the sub market pricing policy for the poor customers. The sub market pricing will result in falling of quality adjusted reproductive health services leading competition in health care markets in its areas of operation. With 80% of the health expenditure being out of pocket, LifeSpring hospital network offering quality reproductive health service at sub market price will significantly reduce the burden of the underserved population from the rising health costs.
Which element of the program proved itself most effective?
CUSTOMER RELATIONSHIP MANAGEMENT
We believes that pendulum of customer influence in healthcare has significantly shifted in the past few years and continues to shift with gaining momentum in favour of “voice and choice of customers”. We has developed LifeSpring CARES (Courteous, Attentive, Respectful, Enthusiastic & Safe) Protocol for the hospital employees. All employees are expected to be proficient with the CARES protocol. we also conducts mystery client survey & in-depth discuss with customers to get feedback about the hospital services. The feedback is fed into the operational system to improve the overall service. Few of the indicators used by us to measure customer satisfaction with the hospital are: (a) Customers coming through old customer referral, and (b) Customer defection rate.
Our quality policy is centered at exceeding customers expectations.
Number of clients in the last year?
April 2006-March 2007 (1 hospital)
a. Deliveries: 370
b. Other Surgeries: 207
d. Daycare Procedures:93
e. TOTAL In Patients serviced:669
f. Total Out Patients serviced :8903
What is the potential demand?
(a) At a macro level, nearly 49 % of India’s billion plus population fall in the category of Lower middle income class. This category of population is being either serviced by public/charity hospitals or unorganized private sector. LifeSpring hospitals are positioned to reach out this population category by providing quality healthcare at an affordable price.
(b) As per the CII-McKinsey report on Indian Health care industry, maternity is the second largest reason for hospitalization in the country leading to about 7.4 million inpatients treatment annually. (Acute infection 43 %, Maternity 23 %, Accident/injuries 16 %, Rest 19 %) In Outpatient care, maternity accounts for 47.1 million treatments each year.
Scaling up Strategy
LifeSpring hospitals would follow a cluster approach by setting up hospitals in proximity of each other as to ensure faster scale up, resource optimization and management control. The places selected would be contiguous subject to fulfillment of criteria as mentioned below :-
(a) High Current level of Institutional Deliveries- LifeSpring hospitals would like to set up in areas where the current level of institutional deliveries are high as it would ensure more footfalls in the hospital.
(b) High Private Sector participation in Institutional delivery -LifeSpring hospitals would like to focus on states where the private sector plays an important role in institutional delivery.
(c) High Female literacy rate among the 20-24 years population -Research have shown that higher female literacy has a direct correlation with increase in the utilization rate of maternal health services compared to illiterate women, even after controlling income and healthcare supply factors.
(d) Ease of Management of hospitals-Ease of management of hospitals from HQ would be an important criteria. Initially LifeSpring would like to focus on states which could be managed easily from Hyderabad.
(e) Human Resource Availability - LifeSpring hospitals would like to focus on states which have better medical human resource availability.
Stage of the initiative:
1
Expansion plan:
The expansion of LifeSpring hospitals would take place in 2 stages – Stage -1 : 30 hospitals (2007-2010) The first 30 hospitals would be set up in three states namely Andhra Pradesh, Maharashtra and Karnataka.
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Origin of the Initiative
The seed of LifeSpring hospitals sown in the summer of 2003 when CMD of Hindustan Latex Ltd., Mr. M Ayyappan, visited Hyderabad’s leading Government Maternity hospital. Seeing the dilapidated condition of the government hospital and overcrowding, he commented “we need to develop a middle alternative in healthcare for the poor where they get best of healthcare at a price which they can afford and service which is unmatched.” What we see today as LifeSpring is the result of his vision.
This Entry is about (Issues)
Sustainability
What are your two main challenges to finance the growth of your initiative
(a) Hospital Project Cost management, &
(b) Managing HR cost.
At this point of time, LifeSpring hospitals are not looking for additional financing as most of the
investment are tied up for scaling up.
How did you hear about this contest and what is your main incentive to participate?
The business head of LifeSpring hospital was approached by India’s Change agent representative (Ms. Supriya).
Main Incentive to participate
Building partnership with likeminded organization
Spirit of competition
Information Sharing
The Story
Do you have an annual financial statement?
Yes
Do you currently have an annual financial statement that tracks profit/loss?
We do have audited financial statements like P&L statement and Balance Sheet. All our accounts are also audited by statutory auditors and presented to our board.
Please describe the amount (and/or type) of funding you need to implement your initiative, at year 1 and at year 5.
The project requires investment in the range of USD 8-10 million over a period of 3-5 years depending upon the scaling plan. The funding could be as
(a) Grant
(b) Loans
(c) Equity participation
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