Study on the

Not-for-Profit
Hospital
Model in India

June 2021
 Study on the
Not-for-Profit
Hospital
Model in India

June 2021
Study on the Not-for-Profit Hospital
Model in India
Publishing Agency: NITI Aayog
Year of Publication: 21-06-2021
Book, English
ISBN : 978-81-949510-1-8
DOI: 10.31219/osf.io/ba5vu
Suggested Citation: Sarwal Rakesh,
Gopal K Madan, Mehta Rana, Matani
Preet, Aggarwal Ashwani, Arora Vishal,
Sunderarajan Samuel
 Foreword

India’s policies and programmes are aimed at achieving Universal Health Coverage by 2030. With
a population of about 1.38 billion and counting, India has an ever-increasing need for healthcare
services. Although multiple efforts across different areas spearheaded by the Government are
meeting this vast need, statistics available in the public domain reveal a significant gap in the
accessibility and availability of healthcare across all segments of the population. The private sector
plays a significant role in bridging the gap in healthcare availability; however, it usually faces
the challenge of providing affordable care to a large section of the population, while ensuring its
own sustenance and efficiency.
The “Not-for-Profit” Hospital Sector has the reputation of providing affordable and accessible
healthcare for many years. This sector has done yeoman service over the years with some institutions
from even before Independence. Although various institutions have been established for different
purposes, this sector provides not only curative healthcare, but also preventive healthcare, and
links healthcare with social reform, community engagement, and education. They utilize the
resources and grants provided to them by the Government to provide cost effective healthcare to
the population without being overly concerned about profits. However, this sector remains largely
understudied, with a lack of awareness about its services in the public domain.
The aim of this study is to understand the operating model of some of the prominent institutions
across the country, including their premise of service, human resource availability, cost containment
levers, and the challenges they face. This study will facilitate policymakers in deciding how they
can assist this sector to sustain, grow, and in turn, help reach the unreached sections of society.

Dr. Vinod K Paul

Member, NITI Aayog

3
 Acknowledgments

Acknowledgments

We wish to thank the following for their assistance and cooperation in this study

Sr. No Name Designation Organization

Makunda Christian Leprosy & General
1. Dr Vijayanand Ismavel Medical Superintendent
Hospital
2. Dr J V Peter Director Christian Medical College, Vellore
Sri Sathya Sai General Hospital,
3. Dr Narasimhan Medical Superintendent
Prasanthi Nilayam, Puttaparthi
Amrita Institute of Medical Sciences,
4. Dr Sanjeev K Singh Medical Superintendent
Kochi
Mahatma Gandhi Institute of Medical
5. Dr S P Kalantri Medical Superintendent
Sciences, Sevagram
6. Dr Anant Pandhare Medical Director Dr Hedgewar Rugnalaya, Aurangabad
7. Dr Pankaj Shah Medical Superintendent Sewa Rural Kasturba Hospital, Jhagadia
Shushrusha Citizen’s Cooperative
8. Dr Rekha Bhatkhande Medical Director
Hospital, Dadar
9. Mr. Joy Chakraborty Chief Operating Officer PD Hinduja Hospital, Mahim
Basavatarakam Indo-American Cancer
10. Dr R V Prabhakara Rao Chief Executive Officer
Hospital, Hyderabad
EMS Memorial Cooperative Hospital,
11. Mr. M Abdunnasir General Manager
Perinthalmanna

5
Study on the Not-for-Profit Hospital Model in India

STUDY TEAM
Overall guidance

Dr Rakesh Sarwal Additional Secretary NITI Aayog

Dr K Madan Gopal Senior Consultant, NITI Aayog
Mr. Anurag Kumar Health Economist NITI Aayog
Dr Rana Mehta Partner PwC India
Dr Preet Matani Director PwC India
Dr Ashwani Aggarwal Associate Director PwC India
Dr Vishal Arora Principal Consultant PwC India
Mr. Samuel Sunderarajan Senior Consultant PwC India

Designed by

6
 List of
Abbreviations

ABPMJAY – Ayushman Bharat- Pradhan Mantri Jan Arogya Yojana

CAPEX – Capital Expenditure
CBC – Complete Blood Count
CGHS – Central Government Health Scheme
CMC – Christian Medical College
CMCHIS – Chief Minister’s Comprehensive Health Insurance Scheme
ECG – Electrocardiogram
HACCP – Hazard Analysis Critical Control Point
ICU – Intensive Care Unit
IPD – In-patient Department
ISO – International Organization for Standardization
MGIMS – Mahatma Gandhi Institute of Medical Sciences
MJPJAY – Mahatma Jyotiba Phule Jan Arogya Yojana
NA – Not Applicable
NABH – National Accreditation Board for Hospitals and Healthcare Providers
NSS – National Sample Survey
OHSAS – Occupational Health and Safety Management Systems
OPD – Out-patient Department
OPEX – Operational Expenditure
ORIF – Open Reduction Internal Fixation
PNDT – Pre-Natal Diagnostic Techniques
PPP – Public Private Partnerships
PSUs – Public Sector Undertakings
TUV – TUVRheinland
USG – Ultrasonography

7
 Contents

Foreword 3
Acknowledgments 5
List of Abbreviations 7
1. Background 11
2. Objectives 14
3. Approach 15
4. Criteria for Classification of Hospitals 16
5. Methodology 20
6. Key Findings 22
7. Challenges Faced by the Not-for-Profit Hospitals 30
8. Proposed Policy Interventions to Promote the Not-for-Profit Hospital Sector 32
9. Annexures 36
9.1 Questionnaire 36
9.2 Information Request List 38

9.3 Brief hospital profiles 39

10. References 43

9
 1
Background

In the recent past, the NITI Aayog has been endeavoring to study the Private Sector Healthcare
Delivery landscape in India to ascertain the reach of quality healthcare, the health seeking behavior
of the masses, and the healthcare expenditure borne by patients, through various studies. The
studies revealed the lack of penetration of
quality healthcare, especially among the %Beds
economically weaker sections of society in both 100%
90% 20%
urban and rural areas. During these studies, the 28%
80% 39%
work done by the private not-for-profit hospitals 70%
came up for reckoning. There were many 60%
examples of commendable work being done to 50%
40%
provide quality healthcare to the unreached at
30% 61% 80% 72% Rural
low cost; however, all these examples were in 20% Urban
silos, and unknown to the larger section of the 10%
community. This prompted the need for a 0%
Public Beds Private Beds Total Beds
targeted study to gain a crisp and structured
Fig.1: Breakup of Hospital beds in India
understanding about the not-for-profit hospital
Source: World Bank, NSS 75th round, NHRR, IMS study.
model in India.

Bed Density (No. of Beds per 1000 Population) Despite economic growth and
6.0 5.6 modernization, India continues to face
5.5
5.0 significant challenges of unavailability and
4.5
4.0 unaffordability in healthcare services. This
3.5
3.0
is substantiated by the fact that India has
2.7
2.4 2.4
2.5 a lower Bed Density than the rest of the
2.0
1.5 1.2
1.4 world (Fig.2).
1.0
1.0
0.5 In addition, existing hospital beds (Fig.1)
0.0
India Low Middle Low & World European and hospitalization services have a high
income income Middle Union
income level of concentration in urban areas,
Fig.2: Bed density (number of Hospital beds per 1000 which in turn impact the accessibility and
population) in India compared to other parts of the world affordability of hospitalization services.
Source: World Bank

11
Study on the Not-for-Profit Hospital Model in India

The not-for-profit hospitals currently account for only a miniscule share of hospitalization cases
(Fig.3).
Public hospitals that offer healthcare at negligible cost are overstretched. The burden of healthcare
provision shifts to private hospitals, which generally offer healthcare at a higher cost to the patient,
as they must sustain themselves.
Private hospitals are largely divided into “for-profit hospitals,” which account for 23.3% of treated
ailments and “not-for-profit hospitals,” which account for only 1.1% of treated ailments, as of June
2018. (Fig.3). The disparity is further revealed in terms of hospitalization cases (Fig.4), wherein
the for-profit hospitals account for 55.3% of in-patients, while the not-for-profit hospitals account
for only 2.7% of in-patients in the country, according to the findings of the NSS 75th round survey
on Health in India.

Percentage breakup of hospitalization cases by type of Percentage breakup of treated ailments

Hospital (IPD) by type of provider (OPD)

70 Rural Urban 50 Rural Urban

44.3
61.4 45
60 41.4
40
51.9
50 35
45.7 32.5

30 27.3
40 26.2
35.3
25
20.8
30
20

20
15

10
10 4.3
5
3.3
2.4 0.9 1.3 0.9
0 0
Govt. Hospitals Private Hospitals Not-for-Profit Govt. Private Not-for-Profit Private Informal
Hospitals Hospitals Hospitals Hospitals Clinics Providers

Fig.3: Percentage of IPD Treatment Fig.4: Percentage of OPD Treatment

Source: NSS 75th round survey Source: NSS 75th round survey

A not-for-profit hospital does not make profits for its owners from the funds collected for
patient services. The owners of these hospitals are often charitable organizations or non-profit
corporations. The fees for service at these hospitals are generally lower than for-profit hospitals and
the income from fees (above the cost of service) are reinvested in the hospital. These hospitals are
a potential remedy to the challenges of unavailability and unaffordability of healthcare in India.
The infrastructure, services, and charges of these hospitals are positioned to cater to the unreached
and underprivileged population of the country. In addition, these hospitals have managed to
create a perception of goodwill in the country not only through selfless healthcare services with a
social cause, but also through various community engagement programs for education, vocational
training, hygiene, sanitation, women’s empowerment and employment.
Despite their limited presence, which is seen disproportionately in Western, Southern and
North East India (Fig.5), the not-for-profit hospitals have a disproportionate impact on the local
communities they serve.

12
 0.1 to 1%

1.1 to 9%

9.1% & above

Fig.5: Percentage of treated ailments (OPD) by Not-for-Profit Hospitals state-wise

Source: NSS 75th round survey

13
 2
Objectives

The not-for-profit Hospital sector remains a largely understudied sector in India with very less
specific information available in public domain. Thus, this study aims to achieve the following
objectives:
 To document the dynamics of operations of prominent not-for-profit hospitals in the
country
Š Are these hospitals providing low cost care?
Š Are these Hospitals providing acceptable quality of care?
Š What are the various levers that help them offer low-cost, high-quality care?
Š What are the best practices of these Hospitals that can be replicated?
Š What are the challenges that these hospitals face?
 To suggest policy interventions to promote this sector
Š How can these hospitals become publicly more visible?
Š How can these hospitals become operationally more viable?
Š Can their expertise and network be leveraged to improve healthcare service delivery
in Tier 2/ 3 cities and rural areas?
Š How can these hospitals associate in a better way with Government schemes?

14
 3
Approach

The following approach was conceptualized to complete this study:

i. Categorization of the prominent not-for-profit hospitals based

on the premise of services and their ownership
Detailed primary and secondary research on prominent hospitals was used to arrive at
reasonably clear categories in which these hospitals could be classified. This categorization
would be useful to understand the vision behind the establishment of these hospitals and
the guiding force behind them.

ii. Understanding the business model of the hospitals

In addition to the basic understanding of these hospitals, the intent of this study is to
understand the operating model of these hospitals, along with the financial viability, and
their dependence on donations and grants for meeting their operational needs. This study
also attempted to understand how these hospitals have managed to keep their costs lower
than their peers and the focus on quality across these hospitals.

iii. Understanding the challenges faced by these hospitals

Another important objective of the study is to understand and classify the challenges faced
by these hospitals in terms of criticality and universality on a day-to-day basis and the factors
limiting the growth of this sector in the country

iv. Formulation of recommendations for policy interventions to

promote the sector
Based on the information gained from the above-mentioned aspects, the intention is to
ascertain and propose targeted interventions, which will not only mitigate the challenges
faced operationally, but also provide insights for the overall growth of the sector from a
strategic perspective.

15
 4 Criteria for
Classification of
Hospitals

Using the above-mentioned approach and secondary research, the following four categories were
defined for the not-for-profit hospitals (Table 1):
 Faith-based Hospitals
 Community-based Hospitals
 Cooperative Hospitals
 Private Trust Hospitals

a. Faith-based Hospitals
These hospitals work on the premise that selfless service to the society is done as service
to God. A noteworthy feature of all major faiths has been their emphasis on charity and
sharing wealth with others, especially the poor. Throughout the ancient and medieval
periods, voluntary activity found its natural expression through religions institutions. This
concept further accelerated with the advent of western influence and presence in India.
Individual missionaries or religious trusts have founded many such hospitals based on the
principles of religions or deities.
The salient features of the operations model of these hospitals are as follows:
i. Large number of general wards where underprivileged patients pay minimal costs and
receive full/partial charity when required.
ii. Few private wards, where affording patients pay slightly more than basic costs.
iii. Some hospitals even provide free services to all patients.
iv. Most such hospitals provide Secondary-Tertiary level of care, while some even provide
Quaternary care.
v. Economies of scale through high volumes allow low cost of care and internal cross-
subsidization in services.

16
 Criteria for Classification of Hospitals

vi. Doctors and staff sacrificially volunteer to serve for salaries, which are about 50% or
more lower than other hospitals.
vii. These majorly serve in remote areas, where there is negligible penetration of quality
healthcare. They engage the local population through various projects focused on health
and sanitation education, empowerment, vocational training, and so on.
viii. The capital expenditure, and at times, operational expenditure is funded by generous
donations from devotees or from funds accumulated by the trusts.

b. Community-based Hospitals
These hospitals are not necessarily influenced by any faith but operate on the premise that
selfless service to the underprivileged will result in all-round social reform. Highly motivated
doctors, or a team of likeminded doctors, desiring to give back to society, have founded many
such hospitals, often in the same community where they were born/raised.
The salient features of the operations model of these hospitals are as follows: -
i. Large number of general wards, where underprivileged patients pay minimal costs and
receive full/partial charity when required.
ii. Few private wards where affording patients pay slightly more than basic costs.
iii. Economies of scale through high volumes allow low cost of care and internal cross-
subsidization in services.
iv. These hospitals mainly provide secondary-tertiary level of care.
v. Doctors and staff volunteer to serve for salaries that are about 50% or more lower than
other hospitals.
vi. These majorly serve in remote areas, where there is negligible penetration of quality
healthcare. They engage the local population through various projects focused on health
and sanitation education, empowerment, vocational training, and so on.
vii. The capital expenditure, and at times, operational expenditure is funded by generous
donations from philanthropists or from Government grants.

c. Cooperative Hospitals
These hospitals are set up on the premise of self-sufficiency in healthcare by self-participation.
They believe that quality healthcare at an affordable cost (commensurate to the locality of
the hospital) is a right of all citizens and can result in the overall benefit of both the hospital
and its patients.
Individual doctors or a likeminded team of doctors convinced of the same philosophy, have
founded many such hospitals.
The salient features of the operations model of these hospitals are as follows:
i. They invite patients and their families to pay a membership fee – either annual/ or
lifetime/ or through purchase of hospital shares/ or as a hospital-run insurance scheme,
through which the members obtain substantial discounts in out-patient/ in-patient
treatment, investigations and medications.

17
Study on the Not-for-Profit Hospital Model in India

ii. They give priority in non-emergency services to the patients enrolled as members.
iii. They engage the local population through various projects focused on health awareness
and education, camps for senior citizens, and vulnerable citizens.
iv. They engage in marketing and fund-raising activities to increase the number of members.
v. These hospitals mainly provide secondary-tertiary level of care.
vi. They have a designated Indigent Patient Fund for treatment of non-affording patients
based on documentary verification.
vii. Treatment for the members is cross subsidized by the treatment of non-members who are
charged slightly lesser than the market rate but higher than the charges for the members.
viii. Their capital expenditure is funded by the corpus membership fees and by donations
received from philanthropists.

d. Private Trust Hospitals

These hospitals operate with the premise of no profit and no loss and are primarily located
in Tier 1/ Tier 2 cities. Famous businessmen/ philanthropists/ politicians, have founded many
such hospitals in response to social causes based on individually observed needs.
The salient features of the operations model of these hospitals are as follows:
i. They have highly advanced infrastructure with the latest technology.
ii. They provide high-quality care at slightly less or at par with market rates to all patients.
iii. They have a designated indigent patient fund for the treatment of non-affording patients
based on documentary verification.
iv. Most such hospitals provide Secondary-Tertiary level of care while some even provide
Quaternary care.
v. The model involves a Robin-hood concept, wherein the affording patients cross-subsidize
the non-affording patients.
vi. They have separate pricing structures for international patients and underprivileged
patients.
vii. Their capital expenditure is funded by the revenue of the hospital and by donations
received from philanthropists.

18
 Criteria for Classification of Hospitals

Table.1: Categorization of not-for-profit Hospitals

Faith Based Community Based Cooperative Private Trust

Hospitals Hospitals Hospitals Hospitals
Premise Selfless service Selfless service to Self-sufficiency in Service rendered on a
to the society as the underprivileged healthcare by self- no profit and no loss
service to God. of the society, participation basis
not necessarily
influenced by faith.
Founders Individual Individual doctors, Individual doctors Eminent businessmen/
missionaries or or a team of who wish to harness Philanthropists/
religious trusts likeminded the contributions of a Politicians, in response
on the principles doctors, who wider population in to a social cause
of religions or desire to give the nearby areas sset based on individually
deities. back to society, up these institutions. observed needs.
often in the same
community where
they were born/
raised.
Interviewed Makunda Dr Hedgewar Shushrusha Citizen’s Basavatarakam Indo-
Hospitals Christian Leprosy Rugnalaya, Cooperative Hospital American Cancer
& General Aurangabad Centre, Hyderabad
MGIMS Kasturba
Hospital,
Sewa Rural, Hospital, Sevagram PD Hinduja National
Karimganj
Jhagadia Hospital & Medical
EMS Memorial
CMC Vellore Research Centre,
Cooperative Hospital
Mumbai
Amrita Institute of & Research Centre,
Medical Sciences, Perinthalmanna
Kochi
Sri Sathya Sai
Central Trust
Hospitals in
Puttaparthi

19
 5
Methodology

This study involves the following steps:

i. Secondary research for information about the sector

In addition to the information available on the websites of the hospitals, all available
information was mined from Government authorized studies and statistical analysis, such
as the websites of the Ministry of Corporate Affairs, Ministry of Statistics & Programme
Implementation, and so on, to gain reliable and relevant information about these not-for-profit
hospitals and the sector overall.

ii. Identification of prominent not-for-profit hospitals

Based on our secondary research, and the inputs from industry experts and consultations at
NITI Aayog, we shortlisted 11 prominent not-for-profit hospitals were shortlisted (Fig.6) which
was a good representation in terms of locations – Tier1/2/3/Rural, Bed size– 100 to 3000
bedded Hospitals, and level of care – Secondary, Tertiary & Quaternary. These Hospitals
were contacted telephonically and after being informed adequately about the nature, purpose
and scope of the study, they gave their consent to participate in the study

iii. Formal engagement of the top management members of these

hospitals and scheduling of interviews at pre-decided times
A formal invitation to the key stakeholders of the shortlisted hospitals was sent from NITI
Aayog, mentioning the nature, purpose, and scope of the study. After obtaining consent from
these hospitals, a discussion was scheduled with the senior leadership to obtain specific
insights about the operating model of the hospitals, and the challenges they faced continually.

iv. Formulation of a comprehensive questionnaire for interviewing

the top management members of identified hospitals
A targeted questionnaire was designed for the hospitals being interviewed to obtain objective
and subjective information from the senior leadership of these hospitals. The questions

20
 Methodology

were grouped under the sub-topics of General Information, Operations & Business, Human
Resources, Quality and Community Impact, and were designed to provide adequate
quantitative and qualitative information. The questionnaire is attached as Annexure 1.

v. Formulation of a list of specific data requirements from these

hospitals
In addition to the qualitative and quantitative information gained from the questionnaire,
an Information Request List (IRL) was designed to capture specific data points, which gave
quantitative insights, such as Volumes, ALOS, Occupancy, OPD and IPD pricing, and so
on, for the shortlisted hospitals. The hospitals were also requested to provide their recent
financial statements. This is attached as Annexure 2.

vi. Collection and analysis of specific data

The data received from the hospitals during the interviews and as a response to the IRL was
grouped, tabulated, and analyzed to provide meaningful insights about the above-mentioned
objectives of the study.

Category Community Cooperative Private

Faith based
based Hospitals Trusts
Hospitals
4 2 3 2
interviewed

Kasturba Hospital,
Sewagram (Hosp-8) Assam
Makunda Christian Leprosy &
General Hospital, Assam (Hosp-1)
SEWA Rural,
Jhagadia (Hosp-6) Basavatarakam Indo-American
Gujrat
Cancer Hospital, Hyderabad (Hosp-10)
Dr Hedgewar Rugnalaya,
Aurangabad (Hosp-5) Maharashtra Sri Sathya Sai Central Trust
Andhra Hospitals in Puttaparthi (Hosp-4)
Pradesh
PD Hinduja National & Research Karnataka
Centre, Mumbai (Hosp-11) Christian Medical College,
Vellore (Hosp-2)
Shushrusha Citizen's Cooperative
Hospital, Mumbai (Hosp-7) EMS Namboodripad,
Tamil Nadu
Kerala Perinthalmana (Hosp-9)
Amrita Institute of Medical
Sciences, Cochin (Hosp-3)

Fig.6: The Hospitals identified under the defined categories

This map is not to scale. It is an indicative outline intended for general reference use only.
The accuracy of this product is dependent upon the source data and therefore absolute accuracy for navigation or legal
purposes cannot be guaranteed.
The above mentioned hospital numbering (Hosp-1, Hosp-2... Hosp-11) is kept consistent through the entire document.

21
6
Key Findings

Based on the detailed deliberations with the top management members of the selected hospitals
between December 1, 2020 and December 22, 2020, and the analysis of the specific data provided
by them, the following are the key findings:

i. Most of the not-for-profit hospitals charge lower than the for-

profit hospitals
The cumulative cost of care at not-for-profit hospitals is lesser than for-profit hospitals by about
one-fourth in the in-patient department. This is reckoned by the package component of cost,
which is approximately 20% lower, the doctor’s or surgeon’s charges, which are approximately
36% lower and the major aspect being the bed charges, which are approximately 44% lower
than the for-profit hospitals.

Table 2: Average Medical Expenditure (for Hospitalization Cases) in INR

Hospital Type  Government For-Profit Not-for-profit
All
Cost item  Settings* Settings Settings
Package component 557 10060 7959 6012
Doctor's/Surgeons Fee 179 5710 3674 3332
Medicines 2184 6903 5680 4888
Diagnostic Tests 791 3038 2658 2084
Bed Charges 128 3690 2062 2150
Others 612 2444 2201 1668
Total 4452 31845 24233 20134
Source: NSS 75th round survey
*Cost considered for Government settings is only Out-of-pocket expenditure by patients, in addition to this,
Doctor’s salaries, consumable costs etc., are borne directly by the Government.
The above charge structure is not specific to any ailment as studied in the NSS 75th round survey.

The cumulative cost of OPD care (Table .3) in not-for-profit hospitals is about one-third lesser
than private for-profit hospitals. The NSS 75th round data revealed that the not-for-profit hospitals
provide medicines to patients at about 26% lesser than the for-profit hospitals, while the doctor’s
fees are approximately 18% lower in not-for-profit hospitals.
 Key Findings

Table.3: Cumulative Price comparison with other types of Hospitals (OPD)

Hospital Type  Government For-Profit Not-for-profit
All
Cost item  Settings* Settings Settings
Medicines 272 683 396 447
Diagnostic Tests 36 167 211 80
Doctor’s Fee 8 151 105 85
Other 15 52 20 24
Total 331 1062 732 636

Source: NSS 75th round survey

*Cost considered for Government settings is only Out-of-pocket expenditure by patients, in addition to this,
Doctor’s salaries, consumable costs etc., are borne directly by the Government.
The above charge structure is for one treatment episode on OPD basis as studied in the NSS 75th round survey.

A glance at the basic price comparison (Fig.7) of the different categories of not-for-profit hospitals
against a for-profit hospital shows that Faith-based Hospitals and the Community-Based Hospital
charge lower OPD consultation charges than the for-profit hospital. The General Ward Charges
of the Faith-based Hospitals, Community-based Hospital, and the Cooperative Hospital, are lower
than the for-profit hospital. The ICU charges of the Faith-based Hospitals, Community-Based
hospital, and the Cooperative Hospital are lower than the for-profit hospital.

10,000 9,500
9,000
9,000
8,000
7,000
6,195
6,000
5,000
4,000
3,000
3,000 2,600 2,500
2,000 1,700
1,450
1,000 800 1,000
1,000 525 500
50 235 100 100 200
0
Hosp-1 Hosp-2 Hosp-5 Hosp-7 Hosp-11 For Profit Hosp-1 Hosp-2 Hosp-5 Hosp-7 Hosp-11 For Profit Hosp-1 Hosp-2 Hosp-5 Hosp-7 Hosp-11 For Profit
OPD Consultation General Ward Bed Charges ICU Bed Charges

Fig.7: Basic Price comparison with a for-profit Hospital

Source: Primary discussions with stakeholders
Hospital Number is taken from Fig.6

ii. OPD prices of Rural Community Based Hospital are lower, while
Rural Cooperative Hospital prices are comparable with CGHS
Delhi rates (Fig.8)
The OPD and Diagnostic charges of pathology and radiology for routine investigations such
as Complete Blood Count, X-ray Chest, Lipid Profile, Fasting Blood Sugar, Ultrasonography of
Abdomen, Electrocardiogram and OPD Consultation (General Medicine) was compared for the
hospitals under the study. A Price Index was calculated with the CGHS Delhi NCR rates as the
base rate and the other hospital’s price index was mapped accordingly.

23
Study on the Not-for-Profit Hospital Model in India

Category Community Cooperative Private

Faith based CGHS
based Hospitals Trusts

450 420

400

350 333

300
Pricing Index

250
212 212
200 168 161
150
110
100
100
54
50

0
CGHS Hosp-1 Hosp-2 Hosp-5 Hosp-6 Hosp-7 Hosp-8 Hosp-9 Hosp-10

Fig.8: Specific OPD Investigation price index comparison with CGHS Delhi Rates.
Source: Primary discussions with stakeholders
Hospital Number is taken from Fig.6.

When compared to the CGHS Delhi rates, the overall price indexing shows that the Out-patient
Department price index of Rural Community-based Hospital (54) is lower, while the Rural
Cooperative Hospital price index (110) is comparable with CGHS Delhi rates. The prices of the
Faith-based Hospitals – Rural (168) and Tier 2 (333), Tier 2 Community-Based Hospital (212), Tier
2 Cooperative Hospital (161), Tier 1 Cooperative Hospital (420), and the Private Trust Hospital
(212), are higher than the CGHS Delhi price index.
The CGHS Delhi applicable prices are as of 2014 and are pending revision.

iii. IPD prices of the Rural Community-based Hospital are 40–60%

lower, while Rural Cooperative Hospital prices are on par with
CGHS Delhi prices and ABPMJAY prices (Fig.9)

Category Community Cooperative

Faith based CGHS ABPMJAY
600 based Hospitals

507
500 492
445
400
Pricing Index

300 322

200

176
100
125 115
100
50 59

0
CGHS ABPMJAY Hosp-1 Hosp-2 Hosp-5 Hosp-6 Hosp-7 Hosp-8 Hosp-9

Fig.9: Specific IPD (end bill to patient) price index comparison with CGHS Delhi and ABPMJAY Rates.
Source: Primary discussions with stakeholders
Hospital Number is taken from Fig.6.

24
 Key Findings

The end price to the patient for common IPD procedures such as Normal and Cesarean Deliveries,
Hysterectomy, Appendectomy, Cataract, ORIF, Laparotomy and Cholecystectomy was compared
for the not-for-profit hospitals under the study. A Pricing Index was calculated with the CGHS
Delhi rates as the base rate and the same was benchmarked against the ABPMJAY rates.
The comparison revealed that the Rural Community-based Hospital charges are approximately
40–60% lower than the CGHS Delhi NCR rates and the ABPMJAY rates. The prices of the Faith-
based Hospitals – Rural (176) and Tier 2 (445), Tier 2 Community-based Hospital (322), Tier 2
Cooperative Hospital (507), Tier 1 Cooperative Hospital (492).

iv. Most of the Not-for-profit Hospitals are empaneled with State

or Central Government Healthcare schemes (Table.4)

Table.4: Empanelment status with State and Central Government Health Schemes
Cooperative
Faith Based Community Based Private Trusts
Hospitals
Hosp-1 Hosp-2 Hosp-3 Hosp-4 Hosp-5 Hosp-6 Hosp-7 Hosp-8 Hosp-9 Hosp-10 Hosp-11
Assam Mukhyamantri
State NA (Free MJPJAY
Arogya CMCHIS None MJPJAY Amruta, Chiranjeevi MJPJAY Karunya Arogyasri None
Schemese to all) applied
Nidhi Bal Sabha
NA (Free
ABMJAY None None None
to all)
CGHS/
ECHS
ESI

Service provided

Almost all of the identified not-for-profit hospitals are empanelled either with the State Health
Schemes of their respective State, or with the Central Government Health Schemes such as
the Central Government Health Scheme (CGHS), Ayushman Bharat- Pradhan Mantri Jan Arogya
Yojana (ABPMJAY), Ex-servicemen Contributory Health Scheme (ECHS), and Employees State
Insurance (ESI).

v. The not-for-profit hospitals use various levers to facilitate their

low cost of clinical care and reduced operational expenditure

a. Human resource levers

Human resource costs make up a significant amount of the operational expenses in hospitals.
The discussions with the selected hospitals showed the following levers, which they used to
keep the human resource cost as low as possible:
 Salaries of doctors are 50–75% lower than market benchmarks:
The Faith-based Hospitals and Community-based Hospitals had set a conscious ceiling
limit of salaries for their senior doctors who are unanimously likeminded to serve
humanity. In contrast, doctors at for-profit corporate hospitals earn a much higher salary,

25
Study on the Not-for-Profit Hospital Model in India

which also increases with the doctor’s seniority and growth in position. For example, in
a Rural Faith-based Hospital, a Pediatric Surgeon with over 30 years of work experience
receives a meager salary of INR 1 lakh per month, which would be approximately
20–30% of the salary that a consultant with comparable experience would expect to
get in a for-profit hospital.
 Salaries of staff are ~20–30% lower than market benchmarks:
The staff at Faith-based and Community-based Hospitals and Tier 2 Cooperative Hospitals
was working at lower salaries than what they would earn at a for-profit hospital.
 Multitasking workforce reduces the number of total staff required:
The doctors and staff of the Faith-based and Community-based Hospitals (in three hospitals
in the study) were undertaking more activities than their routine job description. Doctors
were performing managerial functions, which reduces the need for administrative staff.

b. Infrastructure and equipment levers

The discussions with the selected hospitals also revealed that as most of them depended on
external funding for capital expenditure; they made judicious use of the resources provided
to them to achieve cost optimization and customization of services, according to the needs
of the target population in the following manner:
 90–95% general ward beds:
Some of the Faith-based and Community-based Hospitals had a greater number of
general ward beds and negligible number of private ward beds. This was in line with
their purpose of low-cost care and it helped in reducing infrastructural costs.
 Energy-efficient construction and judicial installation of air conditioning:
Some of the Faith-based and Community-based Hospitals especially had their majority
of beds without air conditioning and their in-patient rooms had windows to the outside
of the building. This allowed natural light in the rooms and ambient ventilation.
 In-house manufacturing of equipment, such as beds, dental chairs:
One of the Faith-based Hospitals has ventured into in-house manufacturing of equipment,
which helps them reduce purchase costs from external vendors.
 Using high cost equipment beyond the recommended lifespan:
Most of the Faith-based and Community-based Hospitals use their diagnostic and
other equipment for much longer than the recommended lifespan. They could ensure
quality and efficiency because of highly competent biomedical engineers and robust
maintenance regimes.
 Scavenging for usable parts from condemned equipment:
Some of the Faith-based Hospitals were salvaging usable parts from condemned
equipment and using them as spare parts for existing equipment, with the help of highly
competent biomedical engineers.

26
 Key Findings

c. Hospital operations levers

The qualitative and quantitative analysis of the selected hospitals revealed their use of the
following lean operations based on the analysis of their volumes, health seeking behavior,
and paying capacity of their target population:
 Cross-subsidization – This was commonly found across all the categories of nor-for-profit
hospitals, as follows:
Š Across patients – The revenue from patients who paid full charges were used to
cross-subsidize the bills of the patients who could not pay the full charges.
Š Across departments based on volumes – In one of the Faith-based Hospitals, the
revenue from departments that had high volumes and a significant margin of revenue
above the cost price was used to cross-subsidize the services of other departments.
 Most of the Tier 2 and rural not-for-profit hospitals used generic low-cost medicines and
engaged in direct procurement from the manufacturers at lower prices.
 Most of the Tier 2 and rural not-for-profit hospitals spent only a minimal amount on
marketing activities. They also had a no-referral commission policy.
 Most of the not-for-profit hospitals could break even and be self-sustaining at low costs
because of the high volume of patients utilizing their services.
 One Faith-based Hospital and one Private Trust Hospital had highly competent Anesthesia
teams, which enabled them to perform many day care surgeries. This helped them
increase productivity in the utilization of their services.

d. Operational expense levers

One of the indicators for cost-efficient operations is the management of operational expenses.
Despite the relatively low pricing of services, a significant number of patients are unable to
pay their bills, which potentially affect operational cash flows. The qualitative and quantitative
analysis of the interviewed hospitals revealed the following practices to manage operational
expenses:
 Some of the not-for-profit hospitals could engage in a mutual understanding with
corporates, non-governmental organizations, and other willing donors, for funding the
dues of certain non-affording patients.
 Almost all hospitals have no debt, as the capital expenses are mostly funded by
Government grants or by donations from philanthropists. Thus, they can re-use their
revenue on operational expenses

vi. Not for profit Hospitals have lower operating costs as

compared to For-Profit Hospitals (Fig.10)
The recent financial statements of certain Not-for-Profit Hospitals were analysed in detail. The
cost categories were grouped under Employee costs, Material Costs, Repair & maintenance Costs,
Electricity & fuel costs and even other miscellaneous operating costs. In comparison to the industry
benchmarks (which is an average of professionally run Hospitals in Tier 1 cities which are 200
beds or above and in Tier 2 cities which are 100 beds or above), it was found that the interviewed

27
Study on the Not-for-Profit Hospital Model in India

Not-for-Profit Hospitals spent lesser amounts on the above mentioned cost heads. The operating
cost per bed was also significantly lower than the industry average of operating costs in Tier 1
& Tier 2 cities.

Category

Faith based

Community
based
Cooperative
Hospitals
Private
Trusts
Ind Avg.
(Tier 1)
Ind Avg.
(Tier 2)

*Industry average is an average of professional run greater than 100 bed hospital; Tier 2 being for 100 bedded and Tier 1
being for 200 bedded Hospitals. All costs shown as per bed per day.
Source: Discussions with stakeholders and PwC analysis.
Hospital Number is taken from Fig.6.
Fig.10: Breakup of Operational Costs of Not-for-Profit Hospitals

28
 Key Findings

vii. Focus on Quality practices

This study found a strong focus on quality care across all categories of not-for-profit hospitals,
as most of them had some form of accreditation for their services (Table 3). They also had
strong Internal Quality Assurance teams, which performed clinical audits and utilization
audits regularly. Additional Accreditations include ISO 270001:2015, TÜV (OHSAS), College
of American Pathologists, HACCP, and so on.

Table.5: Accreditation status of the not-for-profit Hospital categories

NABH (Entry Level Additional
ISO 9001
complete) Accrediations*
Faith Based Not Accredited Accredited Not Accredited
Community Based Not Accredited Accredited Not Accredited
Cooperative Hospitals Not Accredited Accredited Not Accredited
Private Trusts Accredited Accredited Accredited

*Additional Accreditations include ISO 270001:2015, TÜV (OHSAS), College of American Pathologists, HACCP etc.

29
 7 Challenges Faced
by the Not-for-
Profit Hospitals

In the interviews, the top management of the selected hospitals reported various challenges that
were critical to their operations and sustenance. Using the Mini-Delphi method, we arranged the
challenges in the decreasing order of criticality and applicability to all interviewed hospitals, as
follows:

i. Recruitment and retention of doctors & staff

Most of the hospitals find it difficult to recruit and retain doctors and staff because of the
following reasons:
 Two of the Faith-based and two of the Community-based Hospitals stated that the lower
salaries offered than the for-profit hospitals form a hindrance, especially, for recruiting
specialist and super-specialist consultants.
 Five of the interviewed hospitals stated the remoteness of location of the hospitals,
especially those in rural areas, as a challenge. Although these hospitals provide on-
campus accommodation, as they lack many basic facilities for living in rural areas, not
many doctors and staff would join them or continue for a long time.
 Owing to the above-mentioned reasons, one of the Rural Cooperative Hospitals has
a high volume of patients with cardiac ailments; however, they have been unable to
recruit a full-time cardiologist. They depend on a cardiologist visiting from the nearest
available Tier 2 City thrice a week to perform cardiac procedures.

ii. Reimbursements for treatment of Government health scheme

beneficiaries
As Table.4 shows, most of these hospitals are empaneled with State or Central Government
Health schemes, and they offer treatment to a significant number of beneficiaries.
 Most of the interviewed hospitals have cited perennially delayed reimbursements and
long-pending amounts, despite their persistence, causing strain in their cash flows, and
in turn, burdening their operations.
 Challenges Faced by the Not-for-Profit Hospitals

 Two of the Private Trust Hospitals also have reported that for some of the procedures,
especially, where there are added procedures due to perioperative complications, there
are no set codes, and thus, the hospitals must absorb the additional cost. This is also a
challenge that other stakeholders in the Healthcare industry face, such as the for-profit
hospitals.

iii. Infrastructure and equipment expansions

Many of these hospitals are dependent on external funding in the form of philanthropy and
grants for capital expenditure components, such as infrastructural expansion, purchase of new
technology, and advanced equipment. Some hospitals could contribute only a small amount
of their operational revenue toward the purchase of much-needed new equipment, and
hence, can only purchase/expand with the help of external funding.
 Three of the Faith-based and one of the Community-based Hospitals reported instances
of delay in expansion project approvals from regulatory bodies.
 One Faith-based Hospital reported an overall time frame of five years for the regulatory
permission to operationalize a newly constructed additional wing.

iv. Regulatory challenges

Some of the hospitals, especially those in remote areas, reported challenges because of the
high compliance burden of staffing requirements of the Regulations for running a blood bank,
Clinical Establishments Act, PNDT Act, and Quality standards.
 The Rural Faith-based Hospital and the rural Community Hospital have difficulty in
recruiting a full-time pathologist for the manufacture of blood products/ plasma in a
blood bank; hence, they are dependent on an external blood bank far away, which
causes inconvenience to patients’ relatives and donors.
 Some of the hospitals in rural areas also reported a high burden of paperwork and
record keeping in addition to the challenges with periodic online submission of reports
for certain regulatory compliances.

Fig.11 Challenges faced by the Not-for-Profit Hospitals in a Criticality vs Count matrix

Source: Discussions with stakeholders

31
 8 Proposed Policy
Interventions
to Promote the
Not-for-Profit
Hospital Sector

The proposed policy interventions have been classified into four broad categories: Identification
and Promotion, Leveraging Expertise, Human Resources, and Finance based on the nature of
recommendations. In addition, they have been classified into Short Term and Long Term.

Table.6: Proposed policy interventions to promote the Not-for-Profit Hospital Sector

with the proposed timeline

Identification & Leveraging

Human Resources Financial
Promotion expertise
Short Term Š Develop criteria Representatives of Posting of Š 100% exemption for
to identify these high-performing Government Medical donations (Section
Hospitals not-for-profit College students 80G) (Currently 50%)
Š Develop Hospitals for their mandatory Š Extension of a low-
Mechanisms across different internships in cost credit line (Esp.
to rank these geographical these hospitals Working Capital
Hospitals on a locations can be (To be explored in Loans)
performance Index invited to share accordance with
Š Income Tax exemption
experiences Medical Education
Š Create a national for membership fees
in relevant laws)
level portal/ paid at Cooperative
policy making
directory of these Trust Hospitals
committees
Hospitals Š Single window
clearance for Govt.
reimbursements

Long Term Promote the top Involving high Š Develop a Š Grant in Aid scheme
hospitals for facilitating performing mechanism to (Similar to Gujarat
philanthropy, Hospitals in incentivize super- Model)
investments and PPP models for specialists to Š Timely allocation of
patient flows managing PHCs, work in remote unencumbered land
operations of areas.
Government Š Revisiting of
Facilities, PSU the compliance
Hospitals requirements of
regulations like
CEA, PNDT,
Blood Bank
 Proposed Policy Interventions to Promote the Not-for-Profit Hospital Sector

SHORT TERM
a. Identification and promotion
Develop criteria to identify these hospitals
Formulation of objective criteria such as type, size, location, level of care offered and their
ownership, infrastructure and equipment expansion initiatives, community engagement initiatives
along with their latest photographs/videos, and so on.

Develop mechanisms to rank these hospitals on a performance index

Creation of a rating scale based on the volume of services utilized annually, the extent of charity
work done, impact on the community health indicators of the location, operational efficiency,
and self-sufficiency, to rank the top few hospitals (e.g., Top 50, which can be determined later
based on the details received from the hospitals).

Create a national level portal/directory of these hospitals

Creation of a national portal/directory in the public domain, wherein all the not-for-profit hospitals
can be listed to highlight the hospital and its functions in the public domain.

b. Leveraging expertise
Representatives of high-performing not-for-profit hospitals across different
geographical locations can be invited to share their experiences in relevant
policymaking committees
The not-for-profit hospitals have vast experience in providing low-cost high-quality care to the
unreached sections of society, some of them existing since before India’s Independence, yet, they
remain largely unknown and understudied. To obtain a comprehensive understanding of the sector,
and to tap into this vast expertise, the representatives of high-performing not-for-profit hospitals
across different geographical locations can be invited to relevant policymaking committees.

c. Human resources
Representatives of high-performing not-for-profit hospitals across different
geographical locations can be invited to share their experiences in relevant
policymaking committees
The not-for-profit hospitals have vast experience in providing low-cost high-quality care to the
unreached sections of society, some of them existing since before India’s Independence, yet, they
remain largely unknown and understudied. To obtain a comprehensive understanding of the sector,
and to tap into this vast expertise, the representatives of high-performing not-for-profit hospitals
across different geographical locations can be invited to relevant policymaking committees.

33
Study on the Not-for-Profit Hospital Model in India

d. Financial
100% exemption for donations under section 80G
Income-tax exemption could be increased from the current 50% exemption to 100% exemption for
philanthropy toward the identified not-for-profit hospitals. This could be a catalyst in channelizing
the much-needed funds to deserving hospitals.

Extension of a low-cost credit line (esp. working capital loans)

The Government can consider the provision of working capital loans with lower interest rates,
which would be more financially viable for the not-for-profit hospitals and would assist in adequate
cash flows during times of need.

Income-tax exemption for membership fees paid at Cooperative Trust

Hospitals
To enable higher membership at Cooperative Trust Hospitals, enabling them to achieve their goal
of self-sufficiency in healthcare through self-participation, Income-tax exemption can be given for
membership fees paid at Cooperative Trust Hospitals.

Single window clearance for Government reimbursements

Most of the not-for-profit hospitals reported long-pending reimbursements for the treatments of
Government scheme beneficiaries, which remain uncleared despite persistent follow-ups. The
timely release of these funds can be a substantial boost to their working capital for operations.

LONG TERM
a. Identification & Promotion
Promote the top hospitals for facilitating philanthropy, investments and
patient flows
The Top 50 hospitals should be prominently displayed along with the amount of funding received
over a specific timeline, the amount of funding needed for capital expenditure, and the appropriate
channel for philanthropy and investment, clearly and transparently. These could be listed on
philanthropy-based portals, after adequately verifying the credentials of such hospitals.

b. Leveraging of expertise
Involving high performing Hospitals in PPP models for managing PHCs,
operations of Government Facilities, PSU Hospitals
One Faith-based, one Community-based, and one Private Trust Hospital mentioned that they are
interested in using expertise in provision of cost-efficient high-quality healthcare to the unreached
and underprivileged in association with the Government by professionally managing PHCs,
PSU Hospitals, and other Government facilities. They perceive that they can use the available
infrastructure of the existing Government facilities and achieve efficient utilization to promote
Health for All. The National Health Mission guidelines on Public Private Partnership can be used
for such endeavors.

34
 Proposed Policy Interventions to Promote the Not-for-Profit Hospital Sector

c. Human resources
Revisiting the compliance requirements of regulations such as CEA, PNDT,
Blood Bank
It is necessary to customize the mandatory manpower requirements of the above-mentioned
regulations to make them more relevant to the realities of the remote areas, making them less
cumbersome for these hospitals, who genuinely wish to serve the unreached and underprivileged
with the available low resources. Provision can be made for the representation of top management
members of these not-for-profit hospitals in decision-making committees to understand their
perspectives and practical challenges.

Develop a mechanism to incentivize super-specialists to work in remote

areas
To mitigate the manpower scarcity challenge, super-specialist doctors should be given some
incentives and motivation to engage with hospitals in remote areas where there is a dire need
for their services. These identified hospitals can be granted a certain amount of remuneration per
full-time super-specialist associated with them.
The current e-Sanjeevni program can be integrated and the benefits of this program should be
extended to not-for-profit hospitals.
In addition, to foster learning, associations of Trust Hospital super-specialists in various specialties
can be created and linked virtually.
The penetration of telemedicine can be increased to facilitate e-consultation in unreached areas.

d. Operations & Financial

Grant-in-Aid scheme
Other States can consider the implementation of a Grant-in-Aid scheme similar to the Gujarat
Model, wherein the Government funds up to 75% of admissible costs of the not-for-profit hospitals.
The Grant is provided to various hospitals and dispensaries, run by voluntary organizations and
charitable trusts. The norms of allocation are as per Government Resolution dated December 19,
1991, Health & Family Welfare Department, Gandhinagar. This would enable better cash flows
for operational expenses and can possibly help in creating a fund for future expansions in terms
of infrastructure or equipment.

Timely allocation of unencumbered land

This will help many not-for-profit hospitals who face operational delays in their expansion plan
because of permissions and regulatory clearances.

35
9
Annexures

9.1 ANNEXURE 1–QUESTIONNAIRE

General
1. In the evolving mindset of hospital operations towards profitability, what is the inspiration
behind the current model of your Hospital’s operations?
2. What is the current size (beds) of your Hospital? What is the average volume (OPD
Footfalls and IPD Occupancy & Daily/monthly surgery count)?
3. How has your Hospital grown over the last 5 years (infrastructure/equipment etc.)
4. What are the currently functioning branches / subcenters of the Hospital ?
5. What are the key focus areas of the Hospital services and why?
6. What is your catchment area & target population within it?
7. What is the management structure & governance mechanism of your Hospital?

Operations & Business

1. Can you please provide the list of Top 10 surgeries/procedures by volume?
2. We understand that you charge a miniscule amount from patients, what would be the
average end to end cost for these top 10 surgeries/procedures?
3. What is the approximate CAPEX and OPEX?
4. We understand your charging method which is considerably low as compared to the
private Healthcare providers, are you able to breakeven?
5. What do you do to keep the costs so low? Do you have to depend on external funding
sources like Gap funding/donations etc?
6. What are the government schemes which you Hospital is empaneled with? E.g. AB-
PMJAY, CHGS, ESI, State Programmes etc.
 7. What are the top 5 challenges which the Hospital faces?
8. What are the innovative strategies practiced by your Hospital?

Human resources
1. What is the approximate number of clinical and non-clinical staff at your Hospital?
2. What is the engagement model (full time/fixed salaries/ honorarium etc.) for the doctors?
3. Are your payouts to the manpower in line with the market standards?
4. Do you have any employee engagement activities? How do you keep them motivated
in a challenging environment?
5. What are the charges for treatment of staff at your Hospital?

Quality
1. Is your Hospital Accredited by any of the existing quality accreditation systems?
2. What is your perception of Quality and the way it should be measured?

Community Impact
1. What is the measured impact of the Hospital’s services on community Health indicators
like MMR, IMR etc? (optional)
2. What have been the initiatives to develop trust and goodwill in the community you
serve?
3. What in your opinion would be 3 major interventions with which the government can
help you?
Study on the Not-for-Profit Hospital Model in India

9.2 ANNEXURE 2 – INFORMATION REQUEST LIST

1. Tariffs or the following OPD services: Prices

a) OPD Consultation (Internal Medicine)

b) CBC
c) Urine Routine
d) X-ray Chest
e) Lipid Profile
f) Fasting Blood Sugar
g) USGAbdomen
h) CTBrain Plain
i) MRI Brain Plain
j) ECG
2. Total Bill Amountfor the following IPDservices:
a) Normal Delivery
b) Caesarean Section
c) Coronary Angiography
d) Coronary Angioplasty
e) Total Knee Replacement (Unilateral)
f) Cataract charges without lens
g) Open Reduction Internal Fixation
h) Laparotomy
i) Image Guided Radiotherapy
j) Hysterectomy
k) Appendectomy
1) Laminectomy
m) Cholecystectomy
(In case theabove list has some procedures which are
not applicable to your Hospital, please substitute with
any of the Top 5 procedures done at your Hospital)
3. Average volumes (2019-2020)
a) OPD Footfalls
b) IPD Occupancy
c) Monthly surgery Count
4. Bed Charges
a) General Ward
b) Private Ward
c) ICU
5. Latest Financial Report (as a separate attachment)

38
 9.3 ANNEXURE 3 – BRIEF HOSPITAL PROFILES

About the Hospital Operating Model Key Community Engagement activities

Year of inception – 1993 The Hospital is self- reliant for OPEX and The Hospital engaged and trained the
Level of care – Secondary CAPEX. local ASHAs to increase institutional
Cross subsidization from revenues of high- deliveries and reduce the MMR & IMR at
Geographic presence – Karimganj District,
Makunda Christian volume departments Karimganj District by almost 50%
Assam; Small Branch in Tripura
Leprosy & General Separate charging structure for non-affording The Hospital has conducted detailed
No of Units / Beds – 2/200
Hospital research into its target population to
patients and affording patients
Governance – Makunda Christian Leprosy & customize the services and tariffs.
General Hospital Society, Emmanuel Hospital
Association

Year of inception - 1900 The Hospital is self- reliant for OPEX. The Community health and development
Level of care – Tertiary to Quaternary Depends on Grants for CAPEX (CHAD) program under the Community
Health Department of CMC, Vellore
Geographic presence – Vellore, Tamil Nadu; Cross subsidization from revenues of high-
covers approximately 200,000 in the
units in different locations volume departments
Christian Medical rural, urban and tribal community areas
No of Units/Beds – 7/3000 Separate charging structure for non-affording of Vellore Districts.
College, Vellore
No of beds – 3000 patients and affording patients
Governance - CMC Vellore Association - the
apex body, a Governing council, an Executive
Committee

Year of inception - 1998 The Hospital is self-reliant for OPEX & CAPEX. Regular Health camps in neighboring
Level of care – Tertiary to Quaternary Depends on Grants for CAPEX tribal areas
Geographic presence – Kochi, Kerala; Separate charging structure across units for Vocational Training for Tribals
upcoming unit in Faridabad non-affording patients and affording patients Priority in recruitment for trained tribals
Amrita Institute of
No of Units /Beds- 1/1350 in level 3 staff.
Medical Sciences, Kochi
Governance - Board of Trustees (devotees
from the Math), a Medical Director and a
Chief Medical Superintendent.

39
Annexures
40
About the Hospital Operating Model Key Community Engagement activities

Sri Sathya Sai Central Year of inception – 1956 & 1991 The Hospital gives free treatment to all Mobile Hospital operates from the 1st
Trust Hospitals, patients irrespective of caste, creed, religion, to 12th day of every month at 12 nodal
Level of care – Secondary & Tertiary
Puttaparthi socio-economic condition. points (base villages) drawn from 6
(Sri Sathya Sai General Geographic presence – Puttaparthi, Andhra mandals from Anantapur District. Serves
Hospital, Prasanthi Pradesh patients from 63 target villages along
Nilayam, Puttaparthi with the patients visiting from about
& Sri Sathya Sai No of Units / beds – 2/570
400 villages in the region free of cost.
Institute of Higher Governance – Board of Trustees of the Diagnostic bus has Pathology, X-ray, USG
Medical Sciences, Sri Sathya Sai Central Trust & Color Doppler, ECG, EEG etc. which
Prasanthigram,
Puttaparthi) serves remote areas free of cost
Study on the Not-for-Profit Hospital Model in India

Year of inception - 1989 The Hospital is self- reliant for OPEX. Reached out for medical care and
social transformation to ~270 villages.
Level of care – Tertiary Depends on Grants for CAPEX
Annually ~300000 patients in
Geographic presence – Aurangabad, 80% of the patients (General ward category) Aurangabad and ~100000 patients are
Dr Hedgewar Maharashtra; Unit in Nasik and Shib Sagar, pay ~5% more than the basic cost price reached out in Nashik through outreach
Rugnalaya, Aurangabad Assam of services, the remaining 20% of affording camps.
patients (private ward category) pay ~25%
No of Units / beds – 1/300 40 slums have a full-time resident doctor
more than the basic cost price of services.
Governance – Dr. Babasaheb Ambedkar staying in the slum areas and 8 rural
Vaidyakiya Pratishthan Charitable Trust centers are being run at negligible costs

Year of inception – 1980 The Hospital is self- reliant for OPEX. Took up the Jhagadia block having 6
PHCs and ~1.8 lakh population and
Level of care – Secondary Depends on Grants for CAPEX
showed improvement in the community
Geographic presence – Jhagadia, Gujarat 95% general rooms and only 3 private rooms health indicators
Sewa Rural Kasturba No of Units / beds – 1/225 Annual expenses of ~Rs 10 Cr of which
Hospital, Jhagadia
~2Cr comes from its own revenue, 3 Cr from
Governance – Board of Trustees along with a
reimbursement of Government schemes, and
core management group
~3.5 Cr as grants/ donations
 About the Hospital Operating Model Key Community Engagement activities

Year of inception – 1966 The Hospital is self- reliant for OPEX. The Hospital runs a Senior Citizens
health education and awareness group
Level of care – Tertiary Depends on Grants for CAPEX
which meets every alternate week.
Geographic presence – Dadar, Mumbai; unit Members pay Rs 10,000 as lifetime fees, are
The Hospital collaborates with
Shushrusha Citizens in Vikhroli, Mumbai entitled to the following benefits of Lifetime
neighboring colleges for Anemia
Cooperative Hospital discount of 25% for OPD Consultation
No of Units – 1/143 detection in girls (in line with the
and IPD admission, 10% discount on
Governance – Board. National Anemia programme.
Investigations and medicines.
The Hospital regularly conducts CPR
training for public.

Year of inception – 1944 Grant-in-aid organization wherein Government Achieved the formation of 3-4 Self Help
of India, Maharashtra Government and the Groups per village, totally ~170 such
Level of care – Tertiary
Kasturba Health society share the expenditure groups in all the villages of its field
Geographic presence – Sevagram, Maharashtra of the Hospital & Medical College in the practice area; viz. PHC Anji, Gaul and
No of Units / beds -1/ 1000 proportion of 50:25:25 Talegaon for women empowerment and
MGIMS Kasturba
health empowerment
Hospital Governance – Board of Trustees of Kasturba Annual Health Assurance Membership Card
Health Society for Rs 100/- per person per year and give 50% Kisan Vikas Manch (Farmers’ club)
concession in OPD & IPD services. provides learning for the members to
improve their agricultural yield improve
their economic status

Year of inception – 1998 Membership can be availed by purchasing Dialysis unit with 6 Hemodialysis
shares of Rs 250/- per share. If a person machines, is performing 550 free dialysis
Level of care – Tertiary
buys 400 shares @Rs 1 Lakh, he is given per month
Geographic presence – Perinthalmanna, Kerala free treatment at the Hospital for himself and
EMS Memorial Started a Tribal Health and social
No of Units / beds – 1/500 immediate family for the same amount for that
Cooperative Hospital transformation project at Atapadi which
year
Governance – Board of Directors elected from serves ~40000 tribal patients.
the shareholders Charges for non-members are ~30-35% lesser
than similar for-profit Hospitals

41
Annexures
42
About the Hospital Operating Model Key Community Engagement activities

Year of inception – 2000 The Hospital is self- reliant for OPEX. Cancer awareness and services to the
poor people in avail free cancer diagnosis
Level of care – Tertiary Depends on Grants for CAPEX
through CSP where more than 165000
Geographic presence – Hyderabad, Telangana Separate charge structure for underprivileged people were screened in the last 15
Basavatarakam Indo- patients and for affording/international patients years, 80 camps are done in a year and
No of Units / beds – 1/500
American Cancer CSP screens 15000 poor people
Hospital, Hyderabad Hospital compares the market rate of Private
Governance – Board of Trustees of Nandamuri
Hospitals and intentionally positions its own Cancer Screening Programs at a regular
Basavatarakam Ramarao Memorial Cancer
charges ~ 10-20% lower periodicity
Foundation (NBTRCF)
Study on the Not-for-Profit Hospital Model in India

Year of inception – 1951 The Hospital is self- reliant for OPEX. Runs 12 mobile health clinics in the
rural area of Palghar having residential
Level of care – Quaternary Cross subsidize the treatment of the
staff which cater to ~100000 patients
underprivileged by the revenue generated by
Geographic presence – Mumbai, Maharashtra annually
treating the affording patients
PD Hinduja Memorial No of Units / beds – 1/300
National Hospital Hospital treats 10% of extremely
Governance – Board of Trustees, Governing underprivileged patients free of cost and
Council, an Executive Council and a 10% of underprivileged patients with 50%
professional management tire having the CEO, concession, Does additional charity also.
COO
10
References

1. Shailender Kumar Hooda, 2015. “Private Sector in Healthcare Delivery Market in

India: Structure, Growth and Implications,” Working Papers 185, Institute for Studies in
Industrial Development (ISID).
2. Split of Public and Private beds is taken as 40:60 as per industry estimates; Current
Supply – Different Sources have put current bed density between 0.7 – 1.1. [0.7 as per
world bank 2012, 0.9 as per AHPI – Association of Healthcare Providers (India), 1.3
as per FICCI Heal 2016, 0.95 as per IBEF – India Brand Equity Foundation] – Current
Nos. are shown assuming a density of 1 bed per 1000 population
3. Ministry of Statistics & Programme Implementation http://mospi.nic.in/sites/default/files/
publication_reports/KI_Health_75th_Final.pdf (NSS); Date Accessed - 1/12/2020
4. Ministry of Statistics & Programme Implementation http://mospi.nic.in/sites/default/files/
publication_reports/Final_Report_Non-Profit_Instiututions_30may12.pdf (CSO) (now
NSS) Date Accessed - 1/12/2020
5. Comptroller & Auditor General https://cag.gov.in/webroot/uploads/download_audit_
report/2017/Report_No.27_of_2017_-_Performance_audit_Union_Government_
Assessment_of_Private_Hospitals_Reports_of_Department_of_Revenue_-_Direct_Taxes.
pdf Date Accessed - 1/12/2020
6. Makunda Christian Leprosy & General Hospital http://www.makunda.in/ Date Accessed
- 12/12/2020
7. Christian Medical College, Vellore https://www.cmch-vellore.edu/ Date Accessed-
11/12/2020
8. Sri Sathya Sai Central Trust Hospitals, Puttaparthi https://sssmt.org.in/ Date Accessed-
11/12/2020
9. Amrita Institute of Medical Sciences, Kochi https://www.amritahospitals.org/ Date
Accessed- 15/12/2020

43
Study on the Not-for-Profit Hospital Model in India

10. Dr Hedgewar Rugnalaya, Aurangabad https://www.hedgewar.org/ Date Accessed-

04/12/2020
11. Sewa Rural Kasturba Hospital, Jhagadia https://sewarural.org/ Date Accessed- 11/12/2020
12. Shushrusha Cooperative Charitable Trust Hospital, Dadar http://www.shushrushahospital.
org/ Date Accessed- 5/12/2020
13. Mahatma Gandhi Institute of Medical Sciences, Sevagram https://www.mgims.ac.in/
index.php/contact-us?showall=1Date Accessed- 16/12/2020
14. EMS Memorial Cooperative Hospital, Perinthalmanna https://emshospital.org.in/ Date
Accessed- 24/12/2020
15. Basavatarakam Indo-American Cancer Hospital, Hyderabad https://induscancer.com/
Date Accessed- 1/12/2020
16. PD Hinduja Hospital, Mahim https://www.hindujahospital.com/ Date Accessed-
8/12/2020

44
 Contact:
Health vertical
NITI Aayog, New Delhi
Email: health-pc@gov.in
Tel: 91-11-23042547
ISBN: 978-81-949510-1-8
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