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Indian Hospitals Offer Lessons for US Health Care


One of the biggest problems facing the U.S. health care system is money. Services cost a lot, and many people don't have the money or insurance to pay for the health care they need. Rose Hoban looks at the latest approach to solving that problem.

American academics have spent years looking for ideas about how to make health care affordable. Some professors from Duke University in North Carolina have turned their gaze outside the U.S. They think they've found some examples that work – in India.

Kevin Schulman is a physician. He's also a professor of business at Duke. He went to India to study their health care system and says the health care market there is fiercely competitive.

He describes a new class of hospital that's emerged in the past two decades to serve the rapidly expanding middle class. "Most of the hospitals that we looked at had very, very high volume, so their surgeons are really very technically excellent," he reports.

Research shows that surgeons that do more surgeries are more skilled. "The arguments are that some of their surgeons are even better than most of our surgeons here [in the US]," Schulman adds. "The care provided in the Indian hospitals was of consistently high quality."

Schulman says maintaining that quality was the focus of hospital managers, and doctors were paid incentives to do good work.

"Where they need to make investments to make the operating rooms the best that they could be, they made the investment," he says. "But where they needed to make investments to make the rooms look a little nicer, they saved money in order to save the patient money."

Schulman argues this shows that you can offer quality clinical services, and not worry about the amenities as much. That's different from the situation in the US, where the assumption is that a fancy hospital with lots of amenities gives better care.

Few people in India have health insurance. Most medical care is paid for out of pocket. Schulman says this means patients need to know what they'll have to pay – unlike the U.S. system, where insurance companies negotiate prices directly with hospitals. This is also unlike the system in many European countries, where the government pays the bill. Patients in neither the United States nor Europe know what their care costs.

But Schulman says in India, patients are conscious of cost… and of getting a good value. "If the hospital tells you your service is going to be a certain dollar amount, then complications that arise as a result of surgery, in some cases, are even [covered] by the hospital, financially. So, there's a financial incentive for the hospitals to deliver high-quality service," he says. "There is moreover a custodial reason that they feel that when they make a contract with someone to offer a service, they're bound to deliver that service at that price."

Schulman also says Indian doctors and nurses are extremely proud of their health care system – and of how sophisticated it's become.

His paper is published in the journal Health Affairs.

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