As Express Healthcare marks its 20th Anniversary with the January 2020 edition, we also start the third decade of this millennium. It is heartening that the Vice President of India, M Venkaiah Naidu recently stressed the need to dedicate this decade, from 2020 to 2030, to make India healthier by promoting healthy lifestyle, improving healthcare facilities, making healthcare affordable and accessible to all.
Thus our anniversary edition takes a look at how the sector is gearing up to accomplish this huge responsibility across various facets. For example, the cover story section has stakeholders touch on how they are sustaining business by exploring partnerships and increasing investments. The need to invest in research, strengthen public health, reboot talent and improve medical education remain part of an unfinished agenda. Many hospitals will also invest further in digital transformation thus using more AI enabled solutions like clinical decision support systems.
A recent CRISIL report has good tidings for the hospital sector. Ironically, if the regulations caused strife in the last two years, the main fillip in the next two years is expected to come from the government itself, in the form of improved demand driven by enhanced coverage under Ayushman Bharat. While demonetisation and the ban on large cash transactions impacted occupancy, implementation of the Goods and Services Tax, price cap on medical implants, and increase in minimum wages for nurses and staff moderated profitability.
While these regulatory events in fiscals 2017 and 2018 had impacted revenue growth and profitability of private hospitals, the sector seems to have found a way around such speed breakers. With reworked package rates and rationalised costs, last fiscal’s revenues saw some bounce-back of revenue growth and operating profitability to ~13 percent and 15.3 percent, respectively.
Ironically, if the regulations caused strife in the last two years, the main fillip in the next two years is expected to come from the government itself, in the form of improved demand driven by enhanced coverage under Ayushman Bharat
Further, the CRISIL report states that curtailment of capacity additions allowed for better asset turnaround and aided improvement in credit metrics – for instance, debt to EBITDA (earnings before interest, tax, depreciation, and amortisation) improved to 3.4 times in fiscal 2019 from 3.8 times in fiscal 2017.
Thus the revenue and profitability of India’s hospitals sector should continue to improve between fiscals 2020 and 2021, sustaining the recovery witnessed last fiscal.
If more corporate hospitals sign up for Ayushman Bharat, there will be deeper penetration into Tier-II cities. Hospital chains are likely to further alter healthcare delivery models to align with regulatory changes which will in turn also add to the improving margins. Other structural factors like increasing lifestyle diseases and medical tourism will continue to aid demand, says the CRISIL report.
The health sector will have to cope with changing disease patterns as India’s demographic profile ages. For instance, about 197 million persons, roughly one in seven Indians, suffered from mental disorders of varying severity in 2017. The contribution of mental disorders to the total disease burden has doubled in India from 1990 to 2017, indicating the need for implementing effective strategies to control this increasing burden. Mental disorders were the leading contributor in India to years lived with disability (YLDs), contributing 14.5 percent of all YLDs in 2017.
These facts from the first comprehensive estimates of disease burden due to mental disorders and their trends in every state of India from 1990 published in The Lancet Psychiatry by the India State-Level Disease Burden Initiative, should help India’s health policy makers fine-tune schemes like Ayushman Bharat so that the Health and Wellness Centres (HWCs) become the starting point to prevent, detect and support people with mental health conditions.
The study also has state-level details which can help state governments devise appropriate strategies to detect and treat mental health conditions in a better manner. For instance, the study shows that the prevalence of childhood-onset mental disorders such as idiopathic developmental intellectual disability, conduct disorders, and autism is higher in the northern states but is decreasing across India.
Another report published in The Lancet Public Health shows that road injury was the leading cause of death in India among 15-39 year old males in 2017 and was the second leading cause for both sexes combined. If the estimated trends of road injury deaths up to 2017 were to continue, no state in India is likely to meet the SDG 2020 target of reducing the road injury deaths by half from 2015 to 2020 or even by 2030.
Is our health system capable of providing timely healthcare services for road injury victims? Do we have enough trauma care facilities? The solution calls for coordination between health policymakers as well as transportation officials to truly make a difference.
For the first time, policymakers have credible data to back their planning. Will the early years of this decade see revamped policies in response to this data? Policymakers should remember that this decade will be pivotal to ensuring India has a healthy population, to reap the promised demographic dividend.
For now, all eyes are on Finance Minister, Nirmala Sitharaman as she readies to present her second budget on February 1. Hopefully, Budget 2020 will allocate more funding for public health schemes like Ayushman Bharat as well as announce measures to ease the bottlenecks for the private sector as well.
As we at Express Healthcare embark on our third decade tracking this vibrant and crucial sector, we thank our loyal readers for their support. Do write in with comments, suggestions on how we can help make Vice President Naidu’s wish, to make India healthier this decade, a reality.
viveka.r@expressindia.com