Innovative Indian hospitals could teach 'cost-effective healthcare' to U.S.

A few innovative Indian hospitals could show the United States healthcare how to outgrow the challenges of reducing costs while improving quality of care and access for patients, researchers claimed.

Professor of international business at Tuck School of Business, Vijay Govindarajan, and his co-author Ravi Ramamurti, who is a professor at Northeastern University have taken out an article in the current issue of Harvard Business Review.

The article "Delivering World-Class Healthcare Affordably," revealed nine private Indian hospitals provides quality health care at a fraction of U.S. prices, the Washington Post reports.

Most of these hospitals are accredited by the U.S.-based Joint Commission International or its Indian equivalent, the National Accreditation Board for Hospitals and Healthcare Providers, the authors said.

Health services in India have to be affordable because their patients are poor and typically pay 60 percent of their medical costs out of pocket, the report added.

They have innovated in three areas which are as follows:

1. Using a hub-and-spoke design, with hub hospitals located in major cities and spoke hospitals in rural areas.

2. Transfer of responsibility for routine tasks to lower-skilled workers.

3. Old-fashioned frugality. Indian hospitals shepherd resources by building hospitals at a fraction of the cost spent in the United States, replacing imported devices with local equivalents costing a fraction of the price.