Healthcare-IT Business Strategy

Wednesday, April 23, 2014

Why All Indian Hospitals IT is in Bad Shape

Recently I got a call from a Board member of a leading Hospital chain. I have known him for many years now. He asked me "Which Hospital has the best IT System"; to which I responded that "everyone is suffering...everyone is in the same boat". Then he asked me to give top 3 reasons "Why All Indian Hospitals IT is in Bad Shape". Here is what I told him:

Policy - India lacks a healthcare policy. Therefore there is no incentive for any stakeholder to improve process or technology. Therefore Process and IT are seen as a marketing fad rather than a business need. 

Tangible - No CFO pays of intangible things such as process and technology. All expenses on the process and IT are seen on the liability side but it doesn't add anything to the Asset side. Obviously CFO will have a problem with this intangible model.
Pay out of pocket - There is no Healthcare Financing model. 85-90% of market is pay-out-of-pocket. Therefore the question is 'How much can you load the patient's pocket?'. Obviously it becomes an extremely price sensitive market. All this makes it a breeding ground for local, low-cost, no-quality fly-by-night HIS/EMR software vendors. They aim to solve only the immediate issues but none has delivered on the promises.

Vacuum - Large Healthcare-IT vendors have exited the market. Either they lost interest and exited or got bought out e.g. TrakHealth, iSoft. Also the market is moving from client-server to cloud and from Capex to Opex models. New cloud based players are small in size and yet to reach enterprise class. Existing players are not able to shift out to cloud because of their longterm negotiated contracts in client-server model. However the time is not far off when full conversion of Enterprise class to cloud will happen anyways.

Techno-Functional Skills: Last but not the least. I have harped a lot on this issue earlier - the implementation team has to be techno-functional in the same brain. It doesn't work by putting a technical person together with a functional person.


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