Day-care clinics mushrooming in India, get popular with 'patients'

Day-care formats are proliferating in India. These day-care centres offer specialised treatment for all kinds of ailments. And they have found huge demand by catering to a widespread health care need.

Cared for: A patient getting dialysed at a Fortis Renkare clinic in Delhi. PHOTO: Vivan Mehra Cared for: A patient getting dialysed at a Fortis Renkare clinic in Delhi. PHOTO: Vivan Mehra
Ashritha Bhat, 38, an employee of Canara Bank in Bangalore, has been on dialysis since she was 25. Dialysis is a mechanical process that simulates the functioning of kidneys, purifying the blood of all toxins. Each session takes about five hours and Bhat needs three of them in a week. Over the years, she has been dialysed at both a hospital and a charitable trust. But the provider she prefers the most is Nephrolife, a standalone dialysis centre.

This day-care outfit, which began operations in January 2010, has a chain of 15 kidney care centres in the South today. "I feel that clinics like this offer better quality, with more attention from doctors," says Bhat. "Plus, earlier, I used to travel 9 km. This centre is just 3.5 km from my home and even has a pick-up and drop facility."

Facts and figures
Each session costs around Rs 1,250. While this is more than what she was charged by the charitable trust, it is less than the Rs 2,000 plus charge of many hospitals.

Nephrolife is one of a new breed of clinics mushrooming across India. These day-care centres offer specialised treatment for all kinds of ailments. And they have found huge demand by catering to a widespread health care need.

The numbers indicate just how big that need is. The International Diabetes Federation estimates that India has 61.3 million diabetics in its cities, towns and villages, making it the diabetic capital of the world. It is estimated to have added close to 12 million diabetes patients in the last year alone.

On the nephrology front, industry estimates say India is adding at least 100,000 new kidney failure cases every year. Only five per cent of these have access to regular dialysis. The story is the same for ailments in areas such as cardiac care, urology and gastroenterology.

The huge demand has led to the proliferation of specialist clinics such as Nephrolife. "What we are seeing currently is the first wave of specialities going into day-care formats," says Vishal Bali, CEO of Fortis Healthcare Global, a large hospital chain. "In each speciality there is a sub-group of procedures that is moving outside the hospital setting. Hospitals are focusing more on acute care."

Fortis has launched a series of dialysis clinics under the Renkare brand. The hospital chain is also planning to offer day-care services to cancer patients. This will include chemotherapy.

In addition, says Bali, it is offering outpatient cardiology services such as diagnostics and stress tests to patients through its "heart command centres". Some of it, he adds, leverages Fortis's experience in Australia and New Zealand.

Facts and figures
Apollo, Fortis's rival for the top spot, is also setting up a number of diabetes clinics, calling them 'Sugar'. Some of these will be within the hospital while others will be standalone facilities. It is also looking beyond diabetes. "We have plans to launch a range of speciality formats," says Sangita Reddy, Executive Director of Operations. She did not specify which specialities.

The primary driver of this trend is the cost factor. Typically, costs in a multi-speciality hospital work out anywhere between Rs 50 lakh to Rs 1 crore a bed, says Vikram Vuppala, Founder & MD of NephroPlus, a chain of standalone dialysis centres headquartered in Hyderabad.

This is because of the huge real estate cost and the capital-intensive nature of a hospital. It therefore makes better sense for a hospital to focus on complex surgeries, where a bed could yield Rs 50,000 from a one-hour procedure than a five-hour dialysis session, which earns around Rs 2,000. Incidentally, Kamal D. Shah, one of NephroPlus's three founders, has been on dialysis since July 1997.

Since it is 20 to 25 per cent cheaper to set up outpatient clinics, adds Fortis's Bali, the services are more focussed and affordable for patients. And it is also possible to turn profitable sooner.

"In a day-care format, it takes one fourth or one fifth the time it takes a full-fledged hospital to break even," says Dr A.M. Arun, Chairman and Managing Director of Vasan Eye Care Hospital.

Vasan, set up in 2002, has a network of 100 eye care hospitals. Since December 2009, it has opened 18 dental clinics. Arun now wants to do the same in other specialities and is looking to set up day-care clinics for infertility, urology, skin care, orthopaedics and gastroenterology.

Most of these, he says, will cater to ailments arising from the sedentary lifestyle, changing dietary habits and increased stress levels of many Indians today.

Kidney specialists: (standing, from left) NephroPlus founders Vikram Vuppala, Kamal D. Shah and Sandeep Gudibanda. PHOTO: A . Prabhakar Rao
The only issue that could hinder this segment's growth is the shortage of talent. Industry estimates indicate that India has only around 1,000 nephrologists (kidney specialists) and 5,000 diabetologists.

And only around 150 cardiologists are trained in the country each year, according to Dr Devi Prasad Shetty, Founder and Chairman of Narayana Hrudayalaya Group of Hospitals. The requirement is ten times those numbers.

Dr V. Mohan, Chairman and Chief Diabetologist of Dr Mohan's Diabetes Specialities Centre, says the shortage of talent is the reason he has not been able to scale up. The diabetologist has 40 years of experience in this field and opened his first diabetes centre in 1991. Now, two decades on, he has only 11 such centres.

Investors appear to be quite positive about the day-care model. For instance, venture capital (VC) firm Sequoia Capital has invested in Vasan Eye Care Hospitals. In December 2011, Bessemer Venture Partners, another VC firm, invested in NephroPlus, which plans to open 100 new dialysis centres by 2015.

Considering that each centre could cost around Rs 1 crore, that is a Rs 100 crore investment commitment - quite a coup for a dialysis outfit that is barely two years old.