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‘The Wal-Mart Effect’ makes good hearts

Dr Devi Shetty is tragically out of step with the times. If it were an even remotely fair world, he would the 21st century’s Julian Assange. But he is a man of vision and action; not a smelly peddler of the bleeding obvious.

Established just ten years ago, the ‘Narayana Hrudyalaya Institute of Cardiac Sciences’ near Bangalore today performs the highest number of cardiac surgeries in the world.

“One hundred years after the first heart surgery was done, only 8% of the world’s population can afford it. What happens to the rest?” Dr Shetty asked.

Having practiced in Britain for years, he also asked himself why an Indian equivalent of the National Health System had not been established.

Up against the conventional wisdom that India is simply too vast in size and population for a financially struggling Government to adopt such a revolutionary institution, Dr Shetty responded by becoming a disciple of the what he calls the ‘Wall-Mart Effect’, a system of bringing down costs and prices with huge scales of economy. It also allows a corporation rather than the Government to serve the poor profitably and astoundingly effectively.

It is a less harsh user pays concept.

Heartening figures

His ‘Health City’ has over 1000 beds, performing a heart-stopping 30 plus cardiac operations a day. Dr Shetty himself has performed over 15,000 operations in his career. They have a staggering 1000 walk-in patients a day.

The sister concern in Kolkata is looking to expand to 5000 beds!

This astronomical infrastructure is where the ‘Wal-Mart effect’ kicks in.

Dr Shetty demands, with his enormous buying power, that manufacturers of hospital consumables supply directly from the factory not via a problematic and expensive broker. This brings down costs.

Dr Shetty dramatically illustrated the concept by refusing to pay for laboratory machines that cost as much as $40,000. The manufacturer had to contend with making profit from the chemicals that the machine consumes, in return for leasing the machine free to the hospital.

Every evening doctors are sent an SMS that gives a breakdown of their individual profit/loss statement. Every doctor is responsible for their consumption and revenue. Dr Shetty tells of how even stitch thread left on the spool is not wasted.

There is a careless attitude to conserving resources in other Indian hospitals, where the patient is charged for consumables.

A blood gas analyse will cost 20 cents compared to $10 dollars elsewhere, simply because of the huge amount of outpatients that are treated.

In-patient care is considerably less profitable.

Low Premium Insurance

Another seismic achievement of Dr Shetty is Yeshasvini, a Comprehensive Health Insurance Scheme in Karnataka that has nearly three million members. The premium is 15 cents a month. The insured now sleep in peace knowing that they will not die from not having $2000 dollars.

Dr Shetty’s sublime progress was inspired by the West but now they study him. The mortality rates in Bangalore, at less than 5%, are considerably lower than New York State.

We should be scratching our heads as to how he can have a dedicated nurse for every ICU patient. We should be staggered that he only charges one in six patients for open-heart surgery. We should be rabidly supporting his plan for a health city in every Indian State.

But we won’t. I pray we see an age where he will get more respect than disaffected hackers and programmers of social websites.

Roy Lange is a New Zealand citizen with a passion for India. He now lives works across the Tasman. Pictures supplied by Dr Devi Prasad Shetty.

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