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Small Applied
Research Paper 5
Characteristics and
Structure of the
Private Hospital
Sector in Urban
India: A Study of
Madras City
March 1999
Prepared h i •:
V. R. Muralccdliaran, Ph.I).
Indian Institulc of Technology, Mad ras
Partnerships
for Health
Reform
Abt
Abt Associates Inc. ■ 4800 Montgomery Lane. Suite 600
Bethesda, Maryland 20814 ■ Tel: 301/913-0500 ■ Fax: 301/652-3916
In collaboration with:
Development Associates. Inc. ■ Harvard School of Public Health ■
Howard University International Affairs Center ■ University Research Co.. LLC
I kt mi
5^:
Funded by:
U S- Agency for International Development
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Small Applied
Research Paper 5
Characteristics and
Structure of the
Private Hospital
Sector in Urban
India: A Study of
Madras City
March 1999
Prepared by:
V. R. Muraleedharan, Pli.I).
Indian Institute of Technology, Madras
Partnerships
for Health
Reform
Abt
Abt Associates Inc. ■ 4800 Montgomery Lane. Suite 600
Bethesda. Maryland 20814 ■ Tel: 301/913-0500 ■ fax: 301/652-3916
In collaboration with:
Development Associates. Inc. ■ Harvard School of Public Health ■
Howard University International Affairs Center ■ University Research Co.. LLC
5^2
b unded by.
U.S. Agency for International Development
Partnerships
for Health
Reform
Mission
The Partnerships for Health Reform (PHR) Project seeks to improve people's health in low- and
middle-income countries by supporting health sector reforms that ensure equitable access to efficient,
sustainable, quality' health care services. In partnership with local stakeholders, PHR promotes an
integrated approach to health reform and builds capacity in the following key areas:
better informed and more participatory policy processes in health sector reform;
more equitable and sustainable health financing systems;
improved incentives within health systems to encourage agents to use and deliver efficient
and quality health sendees; and
enhanced organization and management of health care systems and institutions to support
specific health sector reforms.
PHR advances knowledge and methodologies to develop, implement, and monitor health reforms
and their impact, and promotes the exchange of information on critical health reform issues.
March 1999
Recommended Citation
Muraleedharan, V. R. March 1999. Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of
Madras City. Small Applied Research Paper 5. Bethesda, MD: Partnerships for Health Reform Project, Abt Associates Inc.
For additional copies of this report, contact the PHR Resource Center at PHR-InfoCenter@abtassoc.com
or visit our website at www.phrproject.com.
Contract No.:
Project No.:
HRN-C-00-95-00024
936-5974.13
Submitted to:
Robert Emrey, COTR
Policy and Sector Reform Division
Office of Health and Nutrition
Center for Population, Health and Nutrition
Bureau for Global Programs, Field Support and Research
United States Agency for International Development
't
Abstract
This paper examines India's private hospital sector, focusing on urban hospitals. Data collected
for the study from a sample of hospitals in Madras City was used to analyze the size, infrastructure,
and distribution of private hospitals, the range and pricing of services offered, and the various
payment schemes for private hospitals, diagnostic centers, and physicians. The study also identifies
strategies to improve the performance and accessibility of the private hospital market. Policy issues
discussed include the process of deregulation, the interaction between the public and private health
sectors and the question of over-provision of services. The paper concludes that there is a need for
improved data on the growth and distribution of private sector health professionals and for policies
beneficial to both public and private health sectors. Creation of a separate state agency concerned
with the development of the private health sector is also recommended.
Abstract
'r
Table of Contents
Acronyms
ix
Foreword
xi
Acknowledgements
xv
Executive Summary
xvii
1.
Introduction
Rationale and Objectives............................. ..................................
Organization of the Report............................................................
1
2
Methodology............................................................................................
3
2.1
2.2
2.3
Area...................................................................................................
Scope of the Study: Types of Hospitals and Services Covered
Sample Size and Selection............................................................
2.3.1 Hospitals...................................................................................
.3
.4
.5
5
2.3.2 Physicians.................................................................................
6
Data Collection Method..................................................................
2.4.1 Survey Instruments.................................................................
6
6
2.4.2 Pilot study.................................................................................
7
1.1
1.2
2.
2.4
3.
1
Characteristics and Structure of the Private Hospital Sector
3.1
3.2
Private Hospital Market in Madras City: An Overview
3.1.1 Sample Hospitals.......................................................
9
...9
...9
3.1.1.1
Ownership..................................................
3.1.1.2
Bed Size......................................................
...9
.10
3.1.1.3
Ownership of Premises.............................
. 11
3.1.2 Size and Distribution of Private Hospitals.............
.11
3.1.2.1
Size..............................................................
11
3.1.2.2
Distribution............................................
13
Regulatory Issues: Physical and Structural Elements ....
15
3.2.1 Physical Elements......................................................16
3.2.1.1
Space Availability......................................
16
3.2.1.2
Water Supply And Drainage...................
17
3.2.1.3
Power Supply.............................................
17
3.2.1.4
Elevator........................................................
3.2.1.5
Intensive Care Unit Facility......................
Ambulance...................................................
17
18
3.2.1.6
Table of Contents
19
v
'r
3.2.1.7
Pharmacy
..20
3.2.1.8
Laundry
..20
Baby-friendliness
3.2.2 Staffing Issues
3.2.2.1
Physician Availability
..20
3.2.1.9
3.2.2.2
Auxiliary Staff Availability (Nurses and Ayahs)
..21
..21
.. 22
3.2.2.3
Dependence on Public Sector Physicians
3.2.3 Services Offered
3.2.3.1
Range of Services
3.2.3.2
3.3
Networking with Diagnostic Centers....
Payment Methods and Incentives for Quality
3.3.1.1
Flexible Fee Schedule
3.3.1.2
Fixed Fee Schedule
3.3.1.3
3.4
4.
.23
.24
.25
.26
.26
.27
29
Fees Sharing System
29
Competition and Market Strategies
3.4.1 Charges: Aggregate Level
3.4.2 Charges: “Poor” and “Better-off” Neighborhoods
30
30
Conclusions
31
33
Annex A. Survey of Hospitals, Clinics and Nursing Homes
37
Annex B. Points for Discussion with Physicians
55
Annex C. Bibliography
57
List of Tables
Table 1: Distribution of Private and Public Hospitals in Madras city (1996)
4
Table 2. Summary of Sample Size
6
Table 3. Ownership of Sample Hospitals
10
Table 4. Nature of Organization of Sample Hospitals
10
Table 5. Number and Bed Size of Private and Public Hospitals in Madras City
13
Table 6. Distribution of Private Hospitals and Bed Strength w.r.l Postal Pin Zones
14
Table 7. Space Availability per Bed
16
1 able 8. Number of Beds in ICU: Frequency of Hospitals
Table 9. Number of Hours Available per Physician per Day and per Bed
vi
19
21
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
7
Table 10. Number of Hours Available per Nurses and Ayahs per Day per Bed
23
Table 1 1. Government Doctors in Private Hospitals
23
Table 12. Government Doctors in Private Hospitals by Hospital Ownership Category
24
Table 13. Average Number of Government Doctors in Private Hospitals according to
Ownership Category..................................................
24
Table 14. Fifteen Most Commonly Offered Service Areas in Private Hospitals
25
Table 15: Charges for Various Services (in rupees)
31
Table 16: Comparison of Mean Values (in Rupees) for Select Services across “ Poor”
and “Better-ofF’ Neighborhoods..................................................
32
List of Figures
Figure 1. Bed Size of Sample Hospitals (in ascending order)
11
Figure 2. Size of Private and Public Hospitals, Madras City
12
Figure 3. Bed Size versus Area Available per Bed
17
Figure 4. Number of Hospitals with Elevators
18
Figure 5. ICU Bed Size versus Mean Bed Size of Hospitals
19
Figure 6. Ownership by Bed Size of Hospitals Where Physicians’ Fees are Fixed
29
Table of Contents
vii
'r
Acronyms
APHD
Average Physicians Hours per Day
ATDB
Ayahs Time per Day per Bed
CBA
Consultant by Appointment
CWC
Community Welfare Center
DHNSI
Directory of Hospitals and Nursing Homes in South India
DC
Duty Doctors
FFS
Fixed Fee Schedule
FLFS
Flexible Fee Schedule
FSS
Fees Sharing System
HO
Health Officer
ICU
Intensive Care Unit
NTDB
Nurses Time per Day per Bed
NTW
Nursing Time in a Week
NTD
Nursing Time per Day
OB&GYN
Obstetrics and Gynecology
OT
Operation Theatre
TPHD
Total Physicians Hours per Day
TPHDB
Total Physicians Hours per Day per Bed
VC
Visiting Doctor
Acronyms
ix
Foreword
Part of the mission of the Partnerships for Health Reform Project (PHR) is to advance
“knowledge and methodologies to develop, implement, and monitor health reforms and their impact.”
This goal is addressed not only through PHR's technical assistance work but also through its Applied
Research program, designed to complement and support technical assistance activities. The main
objective of the Applied Research program is to prepare and implement an agenda of research that
will advance the knowledge about health sector reform at the global and individual country levels.
An important component of PHR's applied research is the Small Applied Research (SAR)
program. SAR grants are awarded, on a competitive basis, to developing-country research
institutions, individuals, and non-profit organizations to study policy-relevant issues in the realm of
health sector reform. The SAR program has twin objectives: to provide data and analyses relevant to
policy concerns in the researcher's own country, and to help strengthen the health policy research
capacity of developing country organizations.
A total of 16 small research grants have been awarded to researchers throughout the developing
world. Topics studied include health financing strategies, the role of the private sector in health care
delivery, and the efficiency of public health facilities.
SAR grant recipients are encouraged to disseminate the findings of their work locally. In
addition, final reports of the SAR research studies are available from the PHR Resource Center and
via the PHR website. A summary of the findings of each study are also disseminated through the PHR
“in brief" series.
Sara Bennett, Ph.D.
Director, Applied Research Program
Partnerships for Health Reform
Foreword
xi
Small Applied Research Grants
Dr. Joseph K. Konde-Lule (Institute of Public Health, Makerere University). “User Fees in Government
Health Units in Uganda: Implementation, Impact and Scope.”
Dr. R. Neil Soderlunu (University of Witswatersrand). “The Design of a Low Cost Insurance Package.”
Pedro Francke (Independent). “Targeting Public Health Expenditures in Peru: Evaluation of Ministry of
Health Services and Procedures and Proposal of a Targeting System.”
Alfred Obuobi (School of Public Health, University of Ghana). “Assessing the Contribution of Private
Health Care Providers to Public Health Care Delivery in the Greater Accra Region.”
V.R. Muraleedharan (Indian Institute of Technology, Department of Humanities and Social Sciences).
“Competition, Incentives and the Structure of Private Hospital Markets in Urban India: A Study of
Madras.”
Dr. George Gotsadze (Curatio International Foundation). “Developing Recommendations for Policy and
Regulatory Decisions for Hospital Care Financing in Georgia.”
Dr. Aldrie Henry-Lee (The University of West Indies, Institute of Social and Economic Research).
Protecting the Poor, High Risk and Medically Indingent under Health Insurance: A Case Study of
Jamaica.”
Dr. Maria C.G. Bautista (The Institute for Development Policy and Management Research Foundation,
Inc.). “Local Governments' Health Financing Initiatives: Evaluation, Synthesis and Prospects for the
National Health Insurance Program in the Philippines.”
Oliver Mudyarabikwa (University of Zimbabwe). “Regulation and Incentive Setting for Participation of
Private-for-Profit Health Care Providers in Zimbabwe.”
Easha Ramachandran (Institute of Policy Studies, Health Policy Programme). “Operating Efficiency in
Public Sector Health Facilities in Sri Lanka: Measurement and Institutional Determinants of
Performance.”
Dr. M. Mahmud Khan (Public Health Sciences Division, Center for Health and Population Research).
“Costing the Integrated Management of Childhood Illnesses (IMCI) Module: A Case Study in
Bangladesh.”
Dr. Arlette Beltran Barco (Universidad Del Pacifico). “Determinants of Women's Health Services Usage
and Its Importance in Policy Design: The Peruvian Case.”
Frederick Mwesigye (Makerere University, Makerere Institute of Social Research). “Priority Service
Provision Under Decentralization: A Case Study of Maternal and Child Health Care in Uganda.”
Dr. Gaspar K. Munishi (Faculty of Arts and Social Sciences, University of Dar Es Salaam). “The Growth
of the Private Health Sector and Challenges to Quality of Health Care Delivery in Tanzania.”
xii
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
'i
Mathias L. Kamugisha (National Institute for Medical Research- Amani Research Center). “Health
Financing Reform in Tanzania: Appropriate Payment Mechanism for the Poor and Vulnerable Groups in
Korogwe District, Northeastern Tanzania.”
Dr. Joses Kirigia, Dr. Di McIntyre (University of Cape Town Health Economics Unit, Department of
Community Health). “A Cost-Effectivenss Analysis of AIDS Patient Care in Western Cape Province.”
Foreword
xiii
7
Acknowledgements
Phis study was funded by the Small Applied Research Grants Program of the Partnerships for
Health Reform. On behalf the study team, I would like to express my appreciation for their support
and constant guidance provided at various stages of the study. In particular, I would like to thank
Ellen Bobronnikov, Grant Specialist, and Whitney Schott, Program Assistant, of the Applied
Research Program, for their help in finalizing quarterly reports and financial statements.
I would like to thank in particular all the hospitals and physicians who participated in this study
But for their cooperation, this study would not have been possible.
I would like to thank Sara Bennett for her invaluable technical support in analysis of data and
writing of this report. In addition, many valuable comments on the draft report were also received
from Anne Mills, P. Chandra, and A. Vaidyanathan.
I would like to express my appreciation to Peter Berman, Harvard School of Public Health,
Boston, who encouraged me to pursue work on this much neglected area of research in India. Besides,
I would like to thank many others who had contributed at various stages of this study. These include,
D. Veeraraghavan (co-researcher), Randall Ellis, Xavier Raj, Ramji, Maya Devi, Sowmyanarayanan,
and many others.
Acknowledgements
xv
Executive Summary
The private hospital sector in India caters to a large segment of the population, yet it has received
very little attention from scholars, policymakers, and others. As a result, very little is known about
how the private hospital market is functioning and what could be done to improve its performance.
Since mid-1990, the government of India has been trying to persuade the various state governments to
introduce appropriate regulatory mechanisms for private hospital sector. This includes designing
physical standards for various categories of hospitals and evolving an appropriate accreditation
system, besides establishing an appropriate redressal system for patients. But hardly any progress has
been made by state governments in this respect. A major reason for their failure to accomplish this
goal lies in the lack of any understanding of how the private hospital market functions, and what
would work under the prevailing conditions.
This study attempts to fill this gap in the knowledge of the private hospital market in urban India
in particular. In view of this, the study attempts to give as detailed a description and analysis of the
structure and characteristics of the private hospital market as possible by collecting original data from
a sample of hospitals in Madras city. The overarching objective of this study is to understand the size,
structure, and characteristics of the private hospital market in Madras city. More specifically, the
study seeks to:
*
Analyze the size and geographical distribution of private hospitals in Madras city;
A
Study the extent of infrastructural facilities provided in these hospitals;
Study the range of specialty services offered, their organizational features, personnel,
workload, and utilization and pricing of selected services;
Assess the various payinent/incentive schemes prevalent in various private hospitals; and
Identify strategies to improve the performance and accessibility of the private hospital
market.
The city of Madras (recently renamed “Chennai”) has close to 400 private hospitals, for a
population of nearly 8 million people including the suburban areas. Most private hospitals are owned
by individual physicians. Only six are corporate public limited hospitals, i.e., arc listed in the stock
markets. The average size of these private hospitals, which are located in various parts of the citv, is
around 30 beds, and many have fewer than 10 beds. The private/public ratio of beds in the city is
about 48 percent/52 percent.
The private hospital sector in India has grown passively over the years, without any kind of Stale
policy directing its growth and development. As a result, the private hospitals have had no incentive
to follow norms either with regard to physical infrastructure (space per bed; provision of certain
utilities such as drinking water, drainage facilities, elevators, and back-up power) and staffing pattern.
For example, there are no common norms for setting up an intensive care unit (ICU), and as a result
there is vast variation in provision of ICU facilities across private hospitals. The study shows that on a
number of accounts there is prima facie evidence for policymakers to worry about the quality and
quantum of physical infrastructure available for good patient care in private hospitals.
Executive Summary
xvii
n Tamil Nadu, as in many other states in India, it is common for government doctors to work as
consultants in private hospitals. This is more common in large urban areas. Also, there is a complex
network of arrangements between these physicians and private hospitals, as well as with local
diagnostic centers. These diagnostic centers may be independent (stand-alone), or they may be
attached to larger private hospitals. It would be worthwhile to conduct a separate study on the nature
of relationship between them as they are likely to influence their financial performance for mutual
benefits since most payments are made out of pocket on a fee-for-services basis.
While it is difficult to provide an accurate analysis of the competition and market strategies
among private hospitals in Madras city, it is not altogether impossible to say anything in this respect.
Our study indicates a strong presence of non-price competition among private hospitals.
Several policy issues arise out of this study. One of them is the issue of regulation. Who should
regulate the private hospitals, what should be regulated and to what extent, and by what process
should governing be earned out? These three questions are constantly raised by the private hospitals
whenever the issue of regulation and standards are discussed with them. The study provides some
basic data—showing the prevailing practice on a number of physical facilities and staffing patterns in
in
private hospitals—for policymakers to make a beginning.
Given that public sector physicians are in demand in many private hospitals, it is necessary to
think of policies that would be beneficial to both private and public health sectors. One possible
policy could be to identify specialties in high demand from private sector and develop specific
measures to moderate their practice. Additional components could include: (1) public sector
physicians may be asked to share their fees with the government since they are allowed to practice in
private hospitals and (2) limit the number of public sector physicians allowed to practice in private
hospitals based on some mutually agreed criteria. Another possible but less realistic option, to ban the
private practice of public sector physicians during hours they are responsible to public facilities, is
being and will continue to be met with intense resistance from the medical community and perhaps
other influential groups close to policymakers. This latter policy option, if it could be enforced, would
achieve one result: The government doctors would not practice in private premises during office
hours. But whether that would ensure substantial improvement in the provision of care within
government premises during those hours is not automatic.
The study shows that the current payment system has an incentive for physicians to over-provide
care depending upon patients’ ability to pay. The relevant policy issue would be to address how far
such over-provision could be contained. The study argues that, while it is difficult to implement such
policies, over-provision cannot be allowed to persist and therefore policymakers must give adequate
legal protection to the indigent and medically needy patients who could otherwise be victims of overor under-treatment.
Several policy options can be put forward to promote a healthy growth of the private hospital
market in urban India, but they must be acceptable to those who represent it. Much of what can be
done depends on how providers perceive the current market. Most physicians and hospitals express
concern over the “intense competition” in the market, and how as a result they are not doing well
financially. Although it is difficult to prove such impressions with “hard data” one way or another,
they cannot be brushed aside as mere concoctions to fool the analysts or policymakers. It is difficult
to regulate and moderate the private hospital sector given its past reckless unbridled growth in the
past, but the government can make some positive initiatives. The first step in that direction should be
in building their own credibility. As a part of this exercise, the state could perhaps create a separate
body which may be called the “State Private Health Sector Development Agency”—concerned with
xviii
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
developmental needs of the pnvate hospitals in the state. The primary aim of policies should be to
develop a healthy relationship between the
pnvate and
and public
public health
health care
svstem in
in the
rhe state.
the private
care system
Executive Summary
xix
1. Introduction
1.1
Rationale and Objectives
The private hospital sector in India has grown without any kind of conscious state policy with
regard to hospital size or location, personnel employed, capital invested, physical standards, service
charges, nature of contracts with purchasers, information management, etc. Indeed, this holds good
for all kinds of medical care systems in private sector. It is also true that until recently the state had
not shown much interest in analyzing the nature of the private hospital sector or in designing an
appropriate policy for sector growth and development. Since the mid-1990s, the government of India
have been trying to persuade the various state governments to introduce appropriate regulatory
mechanisms for the sector. This includes designing.physical standards for various categories of
hospitals, and evolving an appropriate accreditation system, besides establishing appropriate redressal
system for patients.
While some initiatives have been made by various state governments and non-governmental
organizations in different parts of India (including the state of Tamil Nadu) to address the above
mentioned regulatory issues, as yet the country does not have any state or national level policy
document that has been adopted, or is being considered in consultation with various stakeholders in
private health sector.
This report argues that it is not possible to address adequately these substantive issues and come
out with any acceptable policy toward private hospitals, without an empirical understanding of their
overall behavior, including their structure, prevailing practices, and standards. As of now, there is
literally no analysis of the private hospital market in Tamil Nadu; this is also largely true of most
other parts of India.1
This study attempts to fill this gap in the knowledge of the private hospital market, in urban India
in particular. In view of this, it gives as detailed a description and analysis of the structure and
characteristics of the private hospital market as possible by collecting original data from a sample of
hospitals in Madras city. Its overarching objective is to understand the size, structure, and
characteristics of the private hospital market in Madras city. More specifically, the study:
Analyzes the size and geographical distribution of private hospitals in Madras city;
Studies the extent of infrastructural facilities provided in these hospitals;
Studies the range of specialty services offered, their organizational features, personnel
employed, workload, and utilization and pricing of selected services;
Assesses the various payment/incentive schemes prevalent in various private hospitals; and
Identifies strategies to improve the performance and accessibility of the private hospital
market.
A recent study by Sunil Nandraj and Ravi Duggal on physical standards in private hospitals in Satara district in Maharashtra is very closely
related to the nature of issues with which we are concerned in this study (Nandraj and Duggal. 1996).
1. Introduction
1
The original objectives of the proposed study were more ambitious than outlined above. Both the
pilot study and the actual survey showed that it is very difficult to collect information on a number of
hospital variables including (he volume of patients treated, utilization of services, etc. (for further
discussion on this, see Chapter 2). However, even with the limited amount of data, the sludv
highlights a number of policy concerns that need further inquiry in order to initiate reforms of
(regulatory) processes that will contribute to the overall performance and accessibility of the private
hospital market.
1.2
Organization of the Report
Chapter 2 describes (he methodology of the study and highlights many practical constraints
faced while carrying out the survey. Chapter 3 summarizes the results of the survey with respect to
each of the study objectives. Chapter 4 highlights a number of policy issues that emerge from these
results. Some of these results should be viewed as pointers to an informed consideration of the reform
issues pertaining to private hospital sector. Other results should be viewed as indicative of possible
policy measures to improve the performance of and access to the private hospital sector in Madras
city in particular, and in urban India in general.
2
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
2.
Methodology
2.1
Area
The study is confined to the city of Madras,2 the capital of the state of Tamil Nadu, which is one
of the southern states of India. There arc three reasons why a large urban area is chosen for this study
(1) A large proportion (more than 65 percent) of private hospitals and beds are concentrated in urban
areas (Bhatt, 1993). Therefore, it is hoped that studying private hospitals in Madras citv will reflect
many of the conditions prevailing in the rest of the urban hospital market. (2) Since the study team
had not previously conducted a survey-based study of hospitals, it confined this study to a geographic
area with which it was familiar. (3) The large number of private hospitals in the city provided a fairly
large sample size from one administrative area. If some hospitals refused to respond (as they did), the
team could compensate by including others willing to respond (as it did).
The Madras metropolitan area is divided into 10 administrative zones.3 The zones are further
divided into divisions, totaling 155.4 At the time of deciding the sample size and selection of hospitals
(in December 1997/ January 1998), the study obtained a list of private and public hospitals in the city
maintained by the Health Officer (HO) of the Corporation of Madras.5 Although the HO admitted that
the list was not exhaustive, it was useful for the study’s purpose because it provided (I) the zonal
distribution, (2) the bed size and (3) the addresses of the hospitals.6 The list contains only those
hospitals that provide inpatient care, whereas the study covers private hospitals that provide inpatient
and outpatient care. The zonal distribution of these hospitals are given in Table 1 (the number of
hospitals sampled from various zones are indicated in parentheses in column 4).
TheoftoaJ name of Madras was changed to "Chennai" in 1996. This report will continue to use the name "Madras".
The city is headed by a mayor, who is elected once every five year. The present mayor. M.K. Stalin, was elected in 1996. The last election was
held after a gap of nearly 20 years. The corporation also has councilors representing various divisions of the city. Among many administrative
functions, the corporation provides sanitation, garbage collection, drinking water, drainage facilities, and community health services A separate
health officer oversees public health services in the city. In fact, the state of Tamil Nadu has the distinction of being the first in the country to
have introduced a Public Health Act in 1939. which to this day is considered a very comprehensive regulatory framework to provide public
health care.
The northern zones largely consist of the old city, while the southern zones are more recently developed. The northern zones, being the old
part of the city, have many large government ho pitals (both general and specialty hospitals) built during the colonial era. Many parts of central
Madras are also well developed, as are parts of south Madras.
At the time of this study, the government of Tamil Nadu was actively implementing a regulatory measure that, among other things, demands
compulsory registration of all private clinical establishments (including those offering only outpatient care, diagnostic and laboratory services, by
allopathic and non-allopathic professionals). Even at the time of wnting this report (May-July 1998), the relevant policy was not implemented. It
is hoped that under this policy a registry will be prepared, which would provide a complete picture of not only the number of hospitals but also
the personnel employed, the type of services provided, etc. Eventually, the government hopes to develop and establish physical standards to be
met by the private establishments. How soon this will happen is a matter for speculation! For more details on the origins of this policy and nature
of debate around it, see Bennett and Muraleedharan (1998)
Telephone directories are another useful source of information for getting the number and addresses of the hospitals in the city, but they do
not help identify whether inpatient facilities are provided in a given hospital.
2. Methodology
3
Table 1: Distribution of Private and Public Hospitals in Madras city (1996)
Serial
Number
Zone/Area
(sq.km)
Number of
Divisions
Private
Hospitals
(population
in millions)
(hospitals
sampled)
Public
Hospitals
Community
Welfa re
Centers
(public)
Total
(columns
4+5+6)
Northern Zones
1
I (16)
13 (0.48)
24 (5)
2
2
4
II (W)
30
18 (0.33)
25(5)
4
3
6
Hl(17)
IV (28)
18 (0.71)
19(2)
3
5
35
27
14 (0.56)
~63 (2.08)
25 (11)
4
6
35
93 (23)
13
TT
■127
4
sub-total
Central Zones
5
V(30)
15 (0.47)
56 (14)
3
6
VI (8)
VII (25)
18 (0.32)
20 (2)
1
2
4
25
17(0.66)
6
4
38
50 (1.45)
28 (9)
104 (25)
To
To
124
50
7
sub-total
61
Southern Zones
8
VHI (25)
16 (0.64)
47 (12)
0
9
3
IX (34)
12 (0.48)
18(4)
6
10
3
X(37)
27
31 (9)
0
6'
5
sub-total
14 (0.52)
42 (1.647
36
11
Grand Total (230)
155 (4.8)
TTT
29
42
364"
96 (25)
| 293 (73)
Populabon figures (1991 census);Source: Corporate of Madi
Iras (1996)
North Madras is less economically developed than South Madras. It would be necessary
clus7e"Xts tlwnr"^;650 T T'
T "’S,8htS "lt0 h°W CCOn°nlic devcl°Pment within’ an urban
populated pg 'OS
T
SCen rOm Tab,e '■ nOr,l’Crn Madras is ,llore dc'lsclv
i - |
“ -95 persons per square kilometer area) than central zones (23.016 person per sq km)
wiich arc more densely populated than the southern zones (I 7,083 person per sq.km) Within central
Imspital pc"I 30 m k'' 8
l'°f private ll0sP''a|S- This list shows that there is one private
t In and 00
T
'n
CCntral ai’d SOUtl1 Madras thcre is
Per '.65
sq.km and 1.00 sq.km, respectively. Since the list provided by the corporation is highly
hoJiuT^^XleVTl1'01
7.hcthcr there are other z°'les
as many (if not more) private
hospitals as zone 5. fhis report will return to this issue in the next section.
2.2
Scope of the Study: Typos of Hospitals and Services Covered
alrea^TcciTdcfiiK-Tb^tl 3 S h 0
StCP
COnduct"1£ li,ls
while
scope of the studs has
be specified W nd?
.°Ut Car,icr’
^rvices/ aspects to be studied must
the Udy UK,re L
m
'b3' '' 'S 'mp°rtanl t0 f°CUS 0,1 sPecific serv.ces in order to make
pr vat^ ho pi al fb mm
h' "
"f
COmParisons meaningful. Given the widespread use of
P^ate hospna's for matermty care, the team decided to focus on this sector. On the basis of informal
discussions with d number of physicians, the team realized that most private providers would not be
4
Characterise^ Structu^ol^e PnVate Hospital Sector in Urban India: A Study of Madras City
willing to share their financial data, although they were willing to discuss in general whether they
were financially doing well or not.7
The study excludes both corporate public limited and trust hospitals.8 In Madras city, there are
only six hospitals in the former category; they cannot be compared with the large majority of small
private hospitals which is the study’s focus. Trust hospitals enjoy certain special tax benefits granted
by the government. They are not allowed to distribute profits among shareholders; they are instead
expected to plow profits back into hospital investment, either for expansion or other hospital related
activities. The remaining private hospitals form the bulk of the private hospital sector in the city. The
study s primary objective is to throw light on this largest segment within the private hospital market.
2.3
Sample Size and Selection
2.3.1
Hospitals
According to the list maintained by the Corporation of Madras, there are 293 private hospitals;
this excludes private clinical establishments providing only outpatient care. As mentioned above, the
study intended to exclude both corporate public limited and trust hospitals from the study. Since the
names of six corporate hospitals were known, the study team was able to exclude them from the
sample list. But it was not possible to identify trust hospitals at the time of selection of hospitals. The
team was certain that the survey would capture their identity and therefore could be excluded at the
time of data entry. As it turned out, the survey happened to cover only one trust hospital, which was
duly removed from the analysis.
From the list of private hospitals provided by the Corporation of Madras, the study team
identified 116 reported as having bed size between 10 and 50. A very large number (129) were listed
as having fewer than 10 beds, and only 16 as having more than 50 beds (of these six were the
corporate public limited hospitals). For the remaining hospitals in the list, bed size was not provided.
The study began with an ambitious plan to cover about 100 hospitals. It therefore approached the
116 hospitals with bed size between 10 and 50. As expected, not all hospitals responded positively.
Thus, on completion of the first round of the survey, the team prepared a second list, of 20 hospitals,
all having just under 10 beds (eight or nine beds), two each from 10 zones. The final tally appears in
Table 2.
At the time of initiating this study, the team was optimistic about getting financial data of private hospitals from the Registrar of Companies but
hter learnt that the data are classified as confidential and therefore are not accessible to public.
Various ownership categories are discussed in Section 3.1.
2. Methodology
5
Table 2. Summary of Sample Size
1. Total number of hospitals approached (1st round)
116
a. Number refused at first visit
14
b. Number refused after few visits
36
c. Number found closed
3
d. Number completed
63
2. Total number of hospitals approached (2nd round)
20
a. Number refused
5
b. Number completed
15
3. Total number of hospitals surveyed
78
4. Total number considered for the study
73
Of the 78 establishments surveyed, three were found to be small governmental community
welfare centers (CWC), one was a corporate public limited hospital, and one was a trust hospital;
these were eliminated from the study. The study thus was left with a total of 73 private hospitals, 24.9
percent of the total private hospitals in the city. As the next section will discuss, though the bed size
provided by the corporation was not always accurate it was useful in the selection process.
2.3.2
Physicians
Thirty physicians from various specialties were interviewed by the study’s principal investigator
and researcher. Of these 30, 15 were specialists in obstetrics/gynecology (OB&GYN), five were
general surgeons, five were pediatricians, and five were anesthetists. All were from the sample
hospitals surveyed for this study. In addition, the choice of individual physicians was guided by two
factors: (1) only one from each hospital was chosen, and (2) those who agreed early were interviewed
first. The purpose of these interviews was to understand the nature of fee payment methods that exist
in various private hospitals. These interviews also provided an understanding of the nature of
relationship between physicians, patients, and hospitals. These are discussed in Section 3.3
2.4
Data Collection Method
2.4.1
Survey Instruments
Two sets of survey instruments were used for data collection. One was a structured questionnaire
(see Annex A) used by field investigators to collect original data directly from hospitals. The other
instrument (see Annex B) was a set of questions used by the principal investigator and researcher
while conducting personal interviews with physicians on payment methods prevailing in various
hospitals. The details of these two questionnaires are summarized below.
The first survey instrument, for collecting information from hospitals and nursing homes, is a
structured questionnaire consisting of 50 questions divided into four parts. Part I is concerned with
background information on hospitals (such as nature of organization, range of specialties offered).
Part II is concerned with information on infrastructure (such as water supply, power supply, and
drainage connection). Part III is concerned with hospital personnel (including physicians’ profiles and
6
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
consulting hours, and strength of other personnel). Part IV is concerned with information specific to
maternity services, in addition to information on charges for a number of diagnostic and minor
procedures (many of which relate to maternity care).
The second survey instrument, for collecting information from physicians on fee payment
method and nature of relationship with hospitals, asked physicians to describe the nature of fee
payment method they have adopted and whether they have any agreed basis for sharing their fees
with the hospitals they visit as consultants. Interviewers also noted the physicians' professional
qualifications and years of service, names of hospitals where they do consulting, etc.
2.4.2
Pilot study
The hospital questionnaire was pilot tested in six different hospitals (all with under 30 beds).
This helped to fine-tune the questionnaire. The study team realized that each hospital might require
three to four trips by field investigators to complete the questionnaire since hospitals often were not
able to devote more than 30 minutes to a visit. Each questionnaire was estimated to consume about an
hour or so, even if a hospital had ready all the information requested.
The pilot study also interviewed four physicians from different specialties. They were willing to
describe the fee payment method but were not willing to specify the amount they collect. These
physicians also suggested that the study restrict itself to a few questions. In fact, the brief interviews
(20-30 minutes) with them were used primarily to understand their fees collection mechanism rather
than anything else.
2. Methodology
7
3. Characteristics and Structure of the
Private Hospital Sector
This section provides results of the survey conducted in 73 private hospitals in Madras city. As
elaborated in the introductory section, the principal aim of this study is to obtain an understanding of
the overall profile and characteristics of the private hospital sector in Madras. The results are
provided under the following headings:
Private Hospital Market in Madras City: An Overview
Regulatory Issues: Physical and Structural Elements
Payment Structure
Competition and Market Strategies
3.1
Private Hospital Market in Madras City: An Overview
It is worthwhile to repeat that the study looks at a very specific segment of the hospital market.
The hospitals are chosen based on their bed strength, which reflects the majority of private hospitals
in the city. The study is constrained by the fact the many hospitals refused to participate in the study;
it therefore worked with as many as those who agreed to cooperate, with the only condition that they
should not be a corporate public limited or trust hospital and that they should not have more than 50
beds. In the end, it included a few hospitals that have more than 50 beds since investigators were not
aware of the actual bed count until the survey was over.
To begin, two key characteristics of the sample hospitals, namely their ownership pattern and
bed strength are summarized below.
3.1.1
Sample Hospitals
3.1.1.1 Ownership
Ownership can be divided into four categories®:
1. Sole proprietorship: Most hospitals in fthe city belong to this category. Hospitals in this
category are owned by an individual (physiciani or non-physician). They have unlimited liability.
2. Partnership: These hospitals have two or more but fewer than 20 partners. They have
unlimited liabilities. Profits are shared with partners.
9 There is yet another category called trust hospitals, as mentioned earlier. These hospitals get tax concessions since they can only re-deploy
their profits in hospital related investment, and cannot distribute their profits among partners.
3. Characteristics and Structure of the Private Hospital Sector
9
'r
3. Corporate Private Limited Companies: Hospitals in this category have more than 20 but fewer
than 50 partners. They have limited liability. Profits are shared with partners.
4. Corporate Public Limited Companies: These are corporate companies with limited liabilities
They are allowed to raise resources from the public through issue of shares. The profits are shared
with shareholders. They need not be listed in stock markets.
Table 3 shows the distribution of sample hospitals according to ownership categories. Fifty (68.5
percent) of the 73 hospitals surveyed belong to the sole-proprietorship category: 15 (20.5 percent) are
run as partnership firms; eight belong to the private limited category.
Table 3. Ownership of Sample Hospitals
Ownership Category
Number
Percentage
Sole Proprietorship
50
68.5
Partnership
15
20.5
Private Limited
8
11.0
Such a classification does not by itself tell much about nature of a hospital as an organization.
For example, a hospital may be classified under sole proprietorship but may be run as a charitable
hospital. Similarly there are missionary hospitals registered as trust hospitals. The study therefore
asked respondents to declare whether they are for-profit or motivated by other considerations (see
item 4, Questionnaire A). The sample hospitals are reclassified as shown in Table 4, which throws
further light on the nature of sample hospitals considered for the study.
Table 4. Nature of Organization of Sample Hospitals
Hospital Category
Number
Percentage
Private, for-profit
64
87.7
Private, philanthropic (non-missionary)
7
9.6
Private, missionary
1
1.4
Any other
1
1.4
Sixty-four hospitals (88 percent) declared themselves as private for-profit, seven (9.6 percent) as
philanthropic, non-missionary (meaning they are not primarily for-profit but may charge a small
amount for the services provided). The sample has one missionary hospital, and one hospital
classified itself as “voluntary hospital’’ under “any other’’ category. In India, the term voluntary
hospital is often used to indicate that they are driven less by the profit motive than other concerns.10
3.1.1.2 Bed Size
Figure 1 shows the distribution of beds of the sample hospitals. The average bed size of the
sample is 22.86. As per the list provided by the Corporation of Madras, these hospitals were listed as
having between 10 and 50 beds, but the survey found them to be different for most hospitals.
While this classification may be questioned it is not a cause for worry here as analysis is not based on this classification. However, the study
team believes self-declaration of motives does not fully reflect true motives!
10
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
However, except for a few hospitals, they all fall within the bed size (10 to 50) category considered
here.
Figure 1. Bed Size of Sample Hospitals
(in ascending order)
cn
TD
Q)
_Q
*•
k_
0)
_Q
70
60
50
40
30
E
20
z
10
0
=5
r
r ntitrnrrnW fl tl III flj 11 rj ilijl t o fI tn flj fi II I nj 11 h 11 u
Individual hospitals
N = 7 3 Mean = 22.83 Median = 20.0
Mode = 20 M i n i m u m = 6
J
Maximum = 65
A large number of physicians interviewed also had an impression that the average bed size of a
hospital in Madras city is between 20 and 25, which the survey bears out.
3.1.1.3 Ownership of Premises
The survey showed that 64 (87.7 percent) of the 73 hospitals owned the premises they occupied,
white the remaining nine were on rented premises. Among the 50 sole proprietorship hospitals, 45
owned their premises, while 12 of the 15 partnership and seven of eight private limited hospitals
owned theirs.
3.1.2
Size and Distribution of Private Hospitals
3.1.2.1 Size
To date there is no reliable database and estimate on the size of the private hospital sector in the
stale of Tamil Nadu. In fact, this is true of most other states as well.” The available government
sources undoubtedly underestimate the number. The list of hospitals maintained by the Corporation of
Madras is not only not exhaustive but does not mention the bed size for many of the hospitals it lists.
Besides, as noted earlier, the bed sizes shown for many hospitals are not accurate.
For example, in Andhra Pradesh a much better database on private hospital sector has recently been prepared. For details, see Chawla and
George (1996)
3. Characteristics and Structure of the Private Hospital Sector
11
As the survey work was nearing completion, the Principal Investigator learned of a Directory of
Hospitals and Nursing Homes in South India (DHNSI) published by a private consulting firm in
Madras. It was first published in late 1997,’2 Undoubtedly, this directory is more exhausdve than the
list provided by the Corporation of Madras; but it does not claim to contain names of all private
hospitals in the city. Although it does not give a completely accurate picture of the size of the private
sector, it provides a much better estimate of size than any other known source. Since this directory
was not available at the initial stages of the study, the investigators were constrained to use only the
list supplied by the Corporation of Madras in selecting hospitals. Nevertheless, a discussion of the
directory’s information is useful here.
The DHNSI contains the following information about private hospitals in the major cities of
Tamil Nadu, Kerala, Karnataka, and Andhra Pradesh: (a) name of (he hospital (b) address (c) bed size
(d) ownership category and (e) specialties offered, with names and qualifications of physicians.
According to DHNSI hospitals are classified as (a) Proprietorship (b) Private Limited Companies (c)
Corporate Public Limited (d) Government and (e) Trust hospitals (see Figure 2). Partnership hospitals
are not listed separately but rather are merged with the sole proprietorship category.
Figure 2. Size of Private and Public Hospitals, Madras City
14000
CD
N
co
"O
0)
JD
E
co
12000 i
10000 (
8000 .
6000 .
to
r’
4000 ■
2000 .
0I
M issing
1
i
iVDiLamn
2
3
4
■
5
Management categories
1:Propneter 2:Private limited, 3.Corporate public limited. 4:Government, 5:Trust
The
1 nc DHNSI
UH1ND1 lists 436 hospitals
nospitais in Madras city. Of
Of these, only 25 are government hospitals. The
DHNSI excludes about 60 community welfare centers maintained by the Corporation of Madras in
various zones of the city. CWCs are primarily expected to provide outpatient care and conduct normal
deliveries. According to the corporation, CWCs do not have more than 10 beds each. This needs to
be kept in mind while estimating the total beds in the hospital sector in the city.
12
12
Directory of Hospitals and Nursing Homes in South India, compiled by CommSearch (India) Private Limited (Madras. 1997)
They rarely conduct caesarean deliveries.
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
Table 5: Number and Bed Size of Private and Public Hospitals in Madras City
Ownership Category
1. Proprietor
2. Private Limited
3. Corporate Public Limited
4. Government
5. Trust
6. No. of hospitals that did not report bed
size
Total
Private Beds (sum of rows 1,2,3, and 5)
Public Beds (row 4) :
No. of
No. of
hosp.
324
18
6
25
35
28
beds
5368
1024
1135
12391
4186
436
383
25
24104
11713
12391
Percentage
of Total
(22.2)
(4.2)
(4-7)
(51-4)
(17.7)
Average bed size
(col.3/col.2)
16.59
56.89
189.16
495.64
119.60
n.a.
(48.6)
(51.4)
30.60
495.64
Source: DHNSI. 1997
The average bed size of a private hospital is 30.6, about eight beds more than the average size of
sample hospitals. Overall, the bed-size of the private hospital sector equals that of public hospital
sector—the latter is only marginally larger than the former. But evidently, there are “some” more
private hospitals that are not listed in the DHNSI, as noted earlier. Assuming another 100 of them
with an average size of 15 beds, the private sector would have only another 1500 beds. At the same
time, about 600 beds should be added to the public sector, to account for the 60 CWCs that the
directory does not mention. As a result, the public-private shares of the hospitals market (measured in
bed size) remain more or less the same.
3.1.2.2 Distribution
The previous section noted that zone 5 has the highest number of private hospitals, followed by
zone 8. At the aggregate level, the northern and southern zones have more or less equal numbers of
private hospitals (93 and 96, respectively), not very much lower than the number of hospitals in the
central zones (104).
The DHNIS provides the distribution of private hospitals according to postal codes (pin codes),
but it does not mention the administrative zones in which these hospitals are located. An
administrative zone has several postal areas (pins), and several of them cut across more than one
administrative zone. Table 6 therefore shows only the distribution of private hospitals according to
postal pin codes within the city and their respective bed strength.14
14 Postal pin codes do not follow any geographical pattern. For example, some postal zones (10. 17. 18. 40 and 102 are contiguous areas, but
zones 13. 14. 20. and 21 are not contiguous. So it becomes very complicated to comment on concentration of hospitals by adding successive
postal zone numbers. Observations on hospital distribution are therefore restricted to individual postal zones as given in the DHNIS. But they do
reveal some interesting features of the market in the city.
3. Characteristics and Structure of the Private Hospital Sector
13
Table 6. Distribution of Private Hospitals and Bed Strength w.r.t Postal Pin Zones
Postal pin code
1
2
3
4
5
6
7
8
10
11
12
13
14
15
16
17
18
19
20
21
23
24
26
28
29
30
31
32
33
34
35
39
40
41
42
43
44
45
47
49
50
52
53
56
58
59
60
61
72
73
75
77
14
No. of private
hospitals
2
1
4
12
4
5
4
1
28
5
1
2
8
6
6 .
27
5
7
14
18
5
8
4
11
3
5
3
3
4
7
4
8
13
4
3
1
6
10
1
4
5
6
6
5
1
2
5
6
9
3
5
2
Total beds
114
5
150
589
142
830
74
75
776
57
13
107
101
71
80
463
72
111
447
664
41
206
984
240
62
58
78
113
48
437
255
74
384
95
56
10
76
298
7
46
32
67
62
39
5
132
224
104
97
28
90
25
J
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
Postal pin code
78
79
81
82
83
84
86
87
88
89
91
92
93
94
101
102
106
107
116
unidentified
Total
No. of private
hospitals
5
4
9
2
9
5
4
5
6
1
3
3
1
2
2
7
2
1
4
3
383
Total beds
67
61
106
25
155
171
70
45
115
45
40
37
6
34
10
73
40
5
1067
127
11713
Postal pin 10 has the highest number of private hospitals, followed by I7, 21, and 20. Pin I0 is
contiguous with 40 and 102, which make it the most highly concentrated hospital neighborhood in the
city. It is possible to add several contiguous areas, or find other clusters as well. However, what is
more important to observe is that postal zones with higher concentrations of hospitals do not
necessarily have higher bed strength. For example: though pin 10 has the highest number of hospitals,
it has only 589 beds, whereas pin I 16 has 1,067 beds with only four hospitals. This is because pin 1 16
has a large private teaching hospital with 1,050 beds. Pin 26 has 984 beds with only four hospitals,
because of the presence of two large private hospitals. Population data with respect to postal pin
codes is not available; such data would allow calculation of distribution of per capita private/public
beds in poorer and more affluent regions within the city.
Another important fact should be noted in Table 6: There are many postal pins without anv
private hospitals. While this might be partly due to possible lack of coverage by the directory, it might
also be true that there are no private hospitals in some of these areas. In particular, pins 62-71 have
no private hospitals. 7'wo of these areas belong to the Army, and private hospitals arc not allowed to
be located in such areas.
3.2
Regulatory Issues: Physical and Structural Elements
As noted in the introductory section, the private hospital sector in India has grown passively over
the years, without any kind of state policy directing its growth and development. As a result, the
private hospitals have not followed any norms either with regard to use of physical infrastructure
(space per bed, provision of certain utilities, etc.) and structural aspects of care (medical and
paramedical personnel employed, services offered, etc). Given this situation, it is not surprising that
there is hardly any recognition of the need for (clinical and non-clinical) performance assessment
either from within private sector or policymakers.
3. Characteristics and Structure of the Private Hospital Sector
15
An important objective of this study therefore is to record the availability (not use) of these
various elements that contribute to patient care in hospitals. This section therefore attempts to provide
an overall view of the prevailing conditions and thereby draw some inferences and hvpotheses that
nave policy implications.
3.2.1
Physical Elements
An important aspect of this study is to understand how far patients receiving care in private
hospitals have access to certain basic physical infrastructural facilities. These are summarized below
3.2.1.1 Space Availability
Availability of space per bed has an important bearing on the overall cost of delivering care and
also on the quality of care. While there are no standards as yet defined by law in this respect, it is
essential first to know what is the prevailing practice in private sector.
Table 7 shows that nearly 80 percent (34 of 43 hospitals) have less than 400 square feet available
per bed. Five have more than 500 square feet per bed. The average space shown here reflects the
overall space availabilityfor administrative and clinical purposes, including, laboratories, consulting
rooms, stores, etc. Hospitals surveyed did not provide disaggregated data on space being used for
various purposes (such as outpatient care, laboratory services, operation theatre).
Table 7. Space Availability per Bed
Space Available
(in square feet)
~<= 200
Number
(n=43)
Cumulative Percentage
12
27.9
201-300
11
53.5
301-400
11
79.1
401-500
4
88.4
>500
5
100.0
Average: 344.19 sq.ft.
Median: 300.00 sq.ft.
Minimum: 115.38 sq.ft; Maximum: 1200 sq.ft
Figure 3 plots area per bed against bed size. This shows that large hospitals do not necessarily
have more area per bed than small hospitals. In fact, the few that have more than 600 square feet per
bed are those with bed size of 20 or less.
16
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
Figure 3. Bed Size versus Area Available per Bed
1400
1200 -1000 -CD
'CD
O
CO
Z3
CT
(/)
800 ■-
600 ■400 ■- -
200 -- 0
0
10
20
30
40
50
60
70
bed size
N = 43 Mean = 344.19
Median = 300.00
3.2.1.2 Water Supply and Drainage
Madras city is not known for its abundance of water. Most people get their water (for domestic
purposes) either on alternate days or even once in three days or so. The last two years (1996-98) have
not been so bad in that water is distributed more or less on alternate days for domestic consumption.
In this light, it is important to know how well private hospitals are equipped with this essential
commodity. Of the 73 hospitals surveyed, only two depend exclusively on the public water system.
Twelve (16.4 percent) have their own wells with pump sets. The remaining 59 (81 percent) depend on
more than one source of water for daily use. Most respondents did not mention the quantum of water
they get from various sources.
All 73 hospitals had overhead tank for storage. It is difficult to comment on the tank capacity in
relation to occupancy rates or turnover since the study does not have reliable data on these key
variables. But nearly 36 percent (26) of them provide protected drinking water—using “Aquaguard”
to filter water to make it potable. Nearly all of them provide hot water for bathing purpose. Seventyone hospitals (97 percent) have drainage connection—a rather high figure that is contrary to the
general belief among people.
3.2.1.3 Power Supply
Sixty-six hospitals (90.4 percent) have a generator for back-up power supply. Several physicians
felt it necessary to have back-up power supply particularly because they often conduct cesarean
deliveries and other surgical procedures.
3.2.1.4 Elevator
Few hospitals (19) have elevators. Provision of this facility depends primarily on whether the
types of patients admitted really require it for patient care. In addition, it also depends on where such
patients are accommodated within the hospitals. For example, a hospital may have all their inpatient
3. Characteristics and Structure of the Private Hospital Sector
17
u
beds in the ground floor.’5 P
’ c*----- -- 4 shows UJUl
II y five of 22 hospitals with three floors have an
Figure
that V/1
only
elevator. Out of 28 with two floors, 26 do not have
-----------e an elevator. All hospitals with more than three
floors have an elevator.
Figure 4. Number of Hospitals with Elevators
30
26
20
55
17
cL
w
x:o
*6
10
M is s ing
-Q
E
ZJ
Z
■3-------------
0
2
3
4
H
5
r-
7
F I with elevators
UJ without elevators
Number of floors in hospitals
3.2.1.5 Intensive Care Unit Facility
b.f«e.ebbeep,..,p„elically ’ts
could be compared.
distri?utioOn of ICU?3'5 Ta he
.be .W J Zlr.
3' (42'5 PerCent) rePOrted havin8 a" ^U. Floor-wise
„7bX„r“o"of.r'“ "°°r-0- ™
Out of 22 hospitals with three floors, 10 have an 12”
ICU.^Df these 10, six have it located in the
ground floor three in the first floor, and one in the second floor"But
-—t as noted above, only five of
these hospitals have an elevator.
.0
e"or'anSiC‘rS 'h“ lf “ ICU “ '“,,ed •b“'
noon for „a„, o““
have access
tei”8P,,yS,“"y “
It is also important to look at the number of beds
large majonty (86.7 percent) of hospitals has five or accommodated in ICUs. Table 8 shows that a
less beds per ICU, but there are also hospitals
with six or more beds per ICU.
18
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
Table 8. Number of Beds in ICU: Frequency of Hospitals
Beds per ICU (reported)
J__
Number of
hospitals
Percent
6
20
_2___
7___________
23.3
_3___
3___________
10
_4___
3___________
_5___
7___________
_6___
7____
8 ___
9 ___
10 __
Total
1___________
10
23.3
3.3
3.3
1
1
3.3
3.3
100.0
1
30
Figure 5 shows that, in general, bigger hospitals have more ICU beds than do smaller hospitals.
However, there are exceptions: the study sample contains a hospital having 10 ICU beds out of a total
of 25 beds. Many physicians expressed that this is not an unusual case. Closer examination of this
hospital’s record shows that all 10 of the ICU beds are located in the first floor and that there is no
elevator facility. Although there may be only a few such hospitals in the city, from the public policy
point of view it signifies an important phenomenon in the growth of the private hospital market that
requires a more detailed study because of its relevance to the current debate on regulation of private
hospital sector.
Figure 5. ICU Bed Size versus Mean Bed Size of Hospitals
60
(D
N
W
TJ
0)
_Q
C
c
2
G>
3S
50
4?
40
40
■3T
30
20
10
Tq TO
Missing
2
1
4
3
6
5
9
7
10
Number of beds in ICU
3.2.1.6 Ambulance
A large majority of hospitals (53, or 73 percent) hire ambulance services when required. Twenty
reported that they have their own ambulance service. It is interesting to note that eight out of the 20
that have their own ambulance services have fewer than 10 beds. Perhaps it depends upon their
location and the nature of emergency cases they admit. This highlights the fact that some of the
smaller hospitals are much better equipped compared with larger hospitals in meeting emergency
3. Characteristics and Structure of the Private Hospital Sector
19
services. No one provided data on the rent paid for hiring ambulance services, nor the amount
charged to patients for using ambulance services.
3.2.1.7 Pharmacy
Nearly half the hospitals surveyed (53 percent) have a pharmacy shop within their premises.
Among these, 17 hospitals have 20 or fewer beds, while many hospitals with more than 40 beds do
not have a pharmacy. Many physicians opined that having a pharmacy within the hospital would help
them increase access to care, overall revenue, and also their competitiveness.”16 It is not known how
many of the hospitals own the pharmacies located within their premises. It is possible that in cases
where ownership is different, hospitals and pharmacies may enter into a “contract” based on volume
of sales or other bases. This was hinted at by two of the physicians interviewed by the PI. The policy
implications of this are serious and will be discussed in the concluding section of the report.
3.2.1.8 Laundry
A significant number of hospitals (18, or 25 percent) do not have facilities for washing patients’
cloths, nor do they have a laundry. This includes many hospitals with more than 40 beds. In this
respect, smaller hospitals seem to cater better to the needs of the patients. This will not hold good for
much larger corporate public limited hospitals, which cater to richer patients who can afford to use
costly laundry facilities.
3.2.1.9 Baby-friendliness
Baby-friendliness is a global movement initiated by WHO and UNICEF. It “aims to give every
baby the best start in life by creating a health-care environment where breast-feeding in the norm.”
The government of Tamil Nadu in 1993 implemented The Baby-Friendly Hospitals Initiative in
public and private hospitals and maternity centers, and issued a set of guidelines to promote practice
of breast feeding. An important aspect of this policy is to discourage advertisements/pictures and
promotion of breast-milk substitutes within hospital premises.17 Those hospitals that satisfy the
various norms of this initiative are declared “Baby-Friendly” and are publicized as such. This may be
thought of as a kind of voluntary accreditation system, restricted to maternity services. Only 11 of 73
hospitals (15 percent) surveyed have been declared as baby friendly, although 43 stated that they do
not store breast-milk substitutes in their premises.
Most hospitals (61, or 84 percent) do not have any play area for the children of their wards.
While this is not yet considered essential to patient care by providers, many physicians felt strongly
that it would substantially enhance the overall satisfaction of the patients, particularly of women
delivering their second or third child and who are accompanied by the siblings (who are often less
than 2 or 3 years of age). While it may not be reasonable to ask for a play area in urban areas where
real estate prices have risen considerably over the last decade or so, the survey does reveal absence of
a strongly felt need by patients.
16 Personnel interview with PI.
Summary of the Indian National Code for Protection and Promotion of Breast-Feeding is available with the Principle Investigator.
20
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
3.2.2
Staffing Issues
3.2.2.1 Physician Availability
The pilot survey revealed that many hospitals use the part-time services of specialist physicians
as well as general physicians. These specialists visit for a few hours on certain days or all days of a
week. This report refers to them as “Visiting Consultants” (VC). Some physicians are employed as
“Duty Doctors” (DC) who work for at least eight hours a day (usually they work for much longer
hours and are also expected to work on call). The survey collected visiting hours of all physicians
(VCs and DCs) in a week; this yielded the total number of hours that physicians spend for patient care
(both inpatient and outpatient) in a week. This is a better indicator of availability of physicians than
mere number of physicians associated with a hospital.
From the available data, the following variables were calculated:
Total physician hours available per day (TPHD): Data on total physicians visiting hours in a
week is divided by 7 to get TPHD.
Total physician hours per day per bed (TPHDB): This is obtained by dividing TPHP by
number of beds in hospital.
Average physician hours per day (APHD): This is obtained by dividing TPHP by the
number of physicians associated with respective hospitals.
The values are summarized in Table 9.
Table 9. Number of Hours Available per Physician per Day and per Bed
Variable
Mean
Minimum
Maximum
Median
std. div
N
TPHD
18.51
2.57
90.00
13.86
16.43
68
TPHDB
1.01
0.15
9.00
0.67
1.18
68
APHD
3.11
0.23
10.00
2.31
2.37
68
Physicians spend an average of 3.11 hours per day in a hospital. The median falls at 2.31 hours,
the minimum and maximum at 0.23 hours and 10.00 hours, respectively. There are 20 hospitals with
four or more hours available per physician per day. Of these 20, only five have more than eight hours
per day. Such a distribution reflects an important structural aspect of the private sector, namely, that
most of them have very few full time physicians (employed on a full-time basis). Most are employed
as consultants on a visiting basis.
Per bed, only 1.01 hours is being spent by all physicians put together per day, with the median
being at 0.67.
Whether or not this is adequate is a matter for further inquiry, which this report cannot do for
want of data. Adequacy depends on several factors, including the overall patient load in different
hospitals. With data on total patient load, the report would have been able to comment on this
3. Characteristics and Structure of the Private Hospital Sector
21
although in a tentative manner. Also unavailable was data on the breakdown of physicians’ time for
inpatients and outpatients. Even with this data, the report would have been constrained to comment on
t ic quality of patient care delivered. These are issues are discussed in the concluding section of the
report.
It would have been more useful to isolate the hours spent by VCs and DDs, but it was not
possible since most hospitals gave only the total hours of visits rather than actual hours of visits for
physicians on visiting days. As a result, it is also difficult to comment on the maximum and minimum
number of doctors on duty at any one time of the day.
3.2.2.2 Auxiliary Staff Availability (Nurses and Ayahs)
It is equally important to look at the strength of auxiliary personnel employed/associated with a
hospital. Here, we consider only the number of ayahs and qualified nurses for analysis. Ayahs
perform a variety of functions, assisting physicians and nurses in delivering care to patients. In fact irin
most hospitals, they perform a significant role in delivering maternal and child care. An ayah usually
has a few years of education and is trained on the job. Nurses, on the other hand, are formally
qualified with about three years of training either in a private or government nursing school. They
usually are employed for eight hours a day and work on shift system. Typically, both nurses and
ayahs get one day off per week.
To measure the extent to which auxiliary staff support patient care, the following two variables
are calculated.
1. Nurse time per day per bed (NTDB): This is the sum total of all nursing hours per day in a
week, divided by the number of beds in respective hospitals. Each nurse works for eight hours a day
for six days a week.
So first calculate total Nursing Time in a Week of a hospital (NTW) as
= Total number of nurses *8*6 =
This NTW is divided by 7 to get Nurses Time available per Day of a week
(NTD) =(NTW)/7
NTD should be further divided by number of beds in respective hospitals to get
NTDB = (NTD) / number of beds
2. The calculation of Ayahs’ Time per Day per Bed is similar:
ATDB — {(No. of ayahs * 8 * 6) / 7) / number of beds
Results of these calculations are summarized in Table 10.
22
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
u
Table 10. Number of Hours Available per Nurses and Ayahs per Day per Bed
Variable
Mean
Minimum
Maximum
Median
std.div
N
NTDB
3.244
0.00
9.681
2.857
1.780
71
ATDB
2.051
0.00
6.857
1.714
1.214
69
Some interesting observations emerge from these simple ratios: Hospitals on average depend
more on nurses than ayahs per bed on any given day. This is contrary to the general impression of
policymakers that most private hospitals are run with the help of ayahs and very few use qualified
nurses for patient care. It is possible to argue that those who participated in the survey might have
deliberately given incorrect, higher figures on the number of nurses employed for fear of misuse of
such information by the researchers. But there is little reason to support such argument.
From the analysis, researchers note that there are two hospitals with no ayahs present, but their
NTDB are 3.43 and 2.86, respectively. Similarly, there is one hospital with no nurse present, whose
ATDB is 3.45.
3.2.2.3 Dependence on Public Sector Physicians
In Tamil Nadu, as in most other states of India and especially in large urban areas, it is common
for government doctors to work as consultants in private hospitals. Therefore, this survey collected
information on the number of government doctors in private hospitals engaged as visiting consultants.
Forty-seven hospitals (66.3 percent) reported having government doctors on their panel as VCs.
But this by itself may not reveal much unless we also know how many on average are associated per
private hospital and their specialty. The overall mean number of government doctors as VCs for the
sample hospitals (n=70) is 2.16. Table 11 provides distribution of government doctors in various
private hospitals .
Table 11. Government Doctors in Private Hospitals
No. of government doctors in
private hospitals
No. of private
hospitals
Percentage
Cumulative
percentage
1
11
24.4
24.4
2
15
33.3
57.8
3
4
8.9
66.7
4
4
8.9
75.6
5
2
4.4
80.0
6
~7
3
6.7
86.7
3
6.7
93.3
9
2
4.4
97.8
15
1
2.2 j
100.0
Mean 3.356
n=45 (two did not provide information)
3. Characteristics and Structure of the Private Hospital Sector
23
u
It would be more useful to know the total number of hours spent by government doctors in
various private hospitals. But the survey did not obtain this information; hence it is not possible to
comment on this important aspect.
Out of the 47 hospitals, 30 (63.8 percent) belong to ('the sole proprietorship category, 12 (25.5
percent) to the partnership category
- - and five (1
. 0.6 percent)) to the private limited category'. Sole
proprietorship and partnership hospitals with government consultants have a larger mean bed size
than those without government consultants. In the case of private limited hospitals, the reverse is tme
(see Table 12).
Table 12. Government Doctors in Private Hospitals by Hospital Ownership Category
Mean bed size of private hospitals
Ownership Category
With govt. Doctors as
consultants
Without govt. Doctors as
consultants
Sole proprietorship
21
Partnership
28
17
Private limited
31
43
17
Table 13 shows the extent of dependence on government doctors according to various categories
of hospitals.
Table 13. Average Number of Government Doctors in Private Hospitals
according to Ownership Category
Ownership category
Mean
n
I.Sole proprietorship
3.4483
29
2. Partnership
3.2727
11
3. Private limited
3.0000
5
4.Overall
3.3556
45
Although the mean values for individual categories do not differ greatly from each other, it
should be emphasized that the
-J mean for hospital category 1 (sole proprietorship) is higher than that of
other two categories.
Visiting Consultants from public hospitals deliver care in about 25 different specialty areas in
private wspitals. They are most highly used in the following areas: general surgery, OB&GYN,
p astic surgery, orthopaedics, cardiology, paediatrics, anaesthetics, and gastroenterology
Neurophysicians in government hospitals are also in high demand in the private hospital sector.
3.2.3
Services Offered
Several physicians perceive competitiveness of a hospital in terms of its ability to provide a
tZv^enendTn r y
m°St h°Spi'als d° nOt have ful|-time specialists. Instead
they depend on consultants visitmg fora few hours on specified days of the week. There are also
many hospitals (small and big) that offer specialists—by appointment (based on type of care the
patients require); they are called “Consultant-By-Appointment” (CBA). In fact, many physicians
24
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
opined that a significant portion of the private hospitals provide specialty care with CBAs. Many of
these VCs and CBAs are from the public hospitals that are allowed by law to do private practice, as
discussed above.
This section provides an overall picture of the range of services provided according to different
ownership categories.
3.2.3.1 Range of Services
On average, a hospital offers services in about 18 different areas. This does not mean that these
hospitals have either VCs or DDs in all these ares. As mentioned above, many hospitals manage to
deliver care with CBAs, which explains the high average number of areas of care offered.
Overall, OB&GYN services are the most widely offered among the sample hospitals (87
percent). This is followed by general medicine, general surgery, paediatrics, and family welfare
planning (which refers mainly to sterilization and maternity related care). Diabetes and urological
care are also common, suggesting a high demand for them. (There are specialized centers for these
service areas in the city, but this study does not cover them.) Table 14 shows the 15 most widely
offered service areas according to hospital ownership category.18
As the average size increases (partnership and private limited hospitals), cardiology, cancer, and
orthopaedics get included in the top 15 areas. The survey could not learn whether these hospitals also
offer surgical services in these areas; the information was requested but most hospitals did not
respond.
Table 14. Fifteen Most Commonly Offered Service Areas in Private Hospitals
S.No
Sole proprietorship
_____ hospitals (n=50)
Partnership hospitals
__________ (n=15)_______
Corporate private limited
Hospitals (n=7)
1
2
Obstet. & Gync. (86)
General MedicineWO
Radiology (100)
General Medicine (82)
Emergency (93)
Obset & Gyn (86)
3
General Surgery (82)
Obstet & Gync. (93)
Paediatric (86)
4
Paediatric (76)
Diabetology (87)
General Medicine (86)
I5
Family Wei. & Pig. (74)
General Surgery (87)
General Surgery (86)
6
Emergency care (66)
Family Wei & Pig (87)
Emergency (86)
7
ENT (60)
ENT (80)
Cardiology (72)
8
9
Tuberculosis (56)
Gastroenterology (73)
Cancer (72)
Burns (56)
Paediatric (73)
ENT (72)
10
Urology (54)
Cardiology (67)
Gastroenterology (72)
11
Orthopedic (54)
Cancer (67)
Nephrology (72)
12
Diabetology (52)
Urology (67)
Orthopedic (72)
13
14
15
Physiotherapy (50)
Tuberculosis (67)
Physiotherapy (72)
Gastroenterology (50)
Burns (67)
Psychiatry (72)
Cardiology (48)
Othopedic (67)
Tuberculosis (72)
Source: Survey
18
The survey does not report on the range of laboratory and diagnostic services due to lack of response.
3. Characteristics and Structure of the Private Hospital Sector
25
3.2.S.2 Networking with Diagnostic Centers
All physicians interviewed without exception said that it is common to find a kind of networkins
e ween hospitals and independent (stand-alone) diagnostic centers in the city. This is particularly
true of smaller hospitals, which “find it difficult to invest a large capital on medical equipment" even
though they frequently use such equipment. Typically small hospitals require referral centers for
radiological, CT scan, MRI, and dialysis services. For these services, physicians said, “there is a
direct contract between hospitals/physicians and these diagnostic centers." This is a very sensitive
issue from a physician’s perspective as well as from the public’s point of view. It is not uncommon to
hear people talk about the deals” between the doctors/hospitals and diagnostic centers. In fact the
principal investigator of this study knows many physicians who confided that typically a doctor -ets a
fixed share of the charges on every patient referred to a diagnostic center. This is not to say that all
physicians in the city support this practice; still, it is a highly prevalent practice and practically no one
and extern of sn'h '' etX1S'enChe' 11 1S lmPossibIe at P^sent to collect further information on the nature
the dflfa n 1 S“ch.c°ntracts: however it is possible to make at least the following observations from
the data available (refer to item 35, Appendix A).
Forty-five of 72 hospitals in the study (62.5 percent) reported that they have a “contract” with
one or more diagnostic centers or with hospitals for diagnostic purposes. The 27 that reported they did
^ehl “h C°ntraCt may StlH bS Send'ng °Ut the'r pat‘entS f0r
Purposes: These patients
may either be going to centers of their choice or may be guided by their physicians.
CT Scan anlMRfirvS'31^89
3 C°ntraCt With d^05^ cente« °r big hospitals for
rvices. Twenty-three of the 45 (51 percent) reported having a contract with one
forTkra Centers/hosP,tals for x-ray services. Only 14 (31 percent) hospitals reported having a contract
f-ultrasound services; this may be due to the fact that a large number of hospitals offering
OB&GYN care prefer to have this facility within their prem.ses since they use it frequently.
It should be noted that the study does not say anything about the frequency with which patients
scone ofthe'smd ' N
Whe‘her theSe referrals are appropriate or not; this is beyond the
scope of the study. Nevertheless, many physicians interviewed for the study confided “that some if
svstem ” "Pa 6
C1"arIy motivated by financial incentives inherent in the referral
y
aymen methods in the hospital market provide incentives for over-servicing The next
section outlines the nature of these payment methods and their implications.
3.3i
Payment Methods and Incentives for Quality
l pnvate hoSplta!SJn .Madras ci'y- as presumably in most other urban areas, have a peculiar
' arTanigeme"t Wlth v'sltlng consultants insofar as fee payment is concerned. This section
nr re
features,of ,hls 'mportant aspect of the private hospital sectoF0 as well as the
nature of the physician market and the ways it can influence the competitive ability of private
fins
19
Interview with PI.
20 for details on sample size and other methodological aspects related to this section, refer Section 11.3,
26
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
1
3.3.1.1 Flexible Fee Schedule
There are three different parties involved in the payment process: patient, physician, and
hospital. It is well known that most payments for outpatient and inpatient care in India are made out
of pocket. Very few are paid by either employers or private/public insurance companies.2' But there is
literally no account of the nature of transactions that take place between the three parlies involved.
Typically, the flow of transactions fora delivery case take place as follows: a woman consults an
OB&GYN specialist for antenatal care, and is referred to a hospital. Generally, after considering the
cost of care and the patient’s economic status, the OB&GYN refers the patient a hospital where
he/she is a VC. These deliveries are called “referred cases.” (If a doctor consults a delivery case not
referred by himself/herself but at the request of the hospital, it is called a “hospital case”).
Diagrammatically this is shown below.
Patient (women, in case of delivery)
consults a Physician (OB&GYN)
gets admitted for delivery into
a specific hospital referred to by a physician
As one physician put it: “hospitals where we are working as VCs expect us to refer our cases to
them for inpatient care. But the nature of arrangements between us helps all the three parties
mutually.” The consultation fee is collected directly from the patients by the doctors. The hospital
does not interfere with what goes on between patient and VC. Patients also pay the hospital directly
for other services such as laboratory, nursing, and canteen charges. The doctor does not interfere with
what goes on between the patient and the hospital. So the patient makes two different transactions as
shown below:
Patient (woman in case of delivery)
pays
physicians’ fee
hospital charges (nursing, diagnostics,directly bed-charges
laboratory, etc)
But there is also another transaction, which takes place between VCs and hospitals. The VCs
generally pay a fixed rent for the space and other infrastructural facilities provided by the hospitals.
The amount paid depends on the number of visiting days per week by the physician, specialty, size
21 World Bank (1995)
3. Characteristics and Structure of the Private Hospital Sector
I
27
and popularity of the hospital, and other factors. Needless to say the physicians can bargain on the
rent depending on their own popularity.
So the third set of transactions between VCs and hospitals may be shown as:
Visiting Consultant pays
*
a monthly/weekly payment to hospitals for use of
consulting room/other clinical and non-clinical
facilities provided by them.
In case of caesarean deliveries or a surgical procedure, where an anaesthetist and a general
surgeon will be involved, the nature of transactions between the parties involved is different, because
of the additional medical personnel. In the case of a caesarean deliver}', the OB&GYN and the
hospital usually have a panel of anaesthetists to help them conduct the delivery. Typically, the
anaesthetist s fee is independent of physician’s fee. The physician may recommend a lower
anaesthetist s fee depending upon patient’s financial position. This amount is collected either by the
physician as part of his/her fee or by hospital as part of other service charges, and paid to anaesthetist
later. The transactions follows the root a-b-c, or a-d-c, as shown below. The diagram shown below
also summarizes all transactions between patients, physicians, and hospitals discussed above.
surgical patients
(a)
pays to hospitals
—-----------(b)
pays anaethetists
x
(d)
(c)
/
pays physicians (OB&GYN or General Surgeon)
Of course, in addition to this, the patient would have to pay for other hospital services
(diagnostic, laboratory, etc). For a “hospital case”, the physician is likely to charge 10 to 15 percent
more than that for a “referred case.” This extra charge goes into the account of the hospital. This is
common in most hospitals surveyed. The lower charges for the “referred cases” may be interpreted as
a form of discount offered to patients since they are known to physicians personally.
Il is not possible to provide information on consulting fees collected per case or visit, since it
depends on the patient’s economic status. Many physicians said: “in fixing fees we keep in mind
patients economic background as well as medical conditions of patients.” Fees for many diagnostic
and laboratory services and hotel facilities provided by hospitals also vary depending upon the type of
room occupied by patients. The nursing charge is rarely fixed in these hospitals; it also varies
according to patients’ economic status and the category of the hospital room. If physicians knows that
a patient is covered by insurance, they would vary their fees accordingly. Hospitals also depend on
the physicians to get patients economic status while fixing their service charges.
The above account of fee payment is most widely prevalent in the city. But there are variations
across hospitals. Two such variations are noted below.
28
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
•I
3.3.1.2 Fixed Fee Schedule
In some hospitals, physicians’ fees are fixed. Twelve of 72 hospitals (16.7 percent) reported that
they fix physician fees. Among these 12, nine belong to sole-proprietorship category, the remaining
three to the private limited category (see Figure 6).
Figure 6. Ownership by Bed Size of Hospitals Where Physicians’ Fees are Fixed
70 V
<D
N
CO
TD
0)
60<50.40--
m 30 .20---------
1
111111113
3
3
Owership category
1=sole-proprietorship; 3=private limited
What is important to note here is that except for those in category 3, others can be classified as
small hospitals. Fixed fee schedules are not uncommon in small hospitals.
3.3.1.3 Fees Sharing System
Some responding physicians pointed out a third variation in payment method, which is perhaps
more common in large hospitals, particularly in certain specialties such as cardiology, urology, and
neurology. Here, the fees are fixed per consultation but the patient pays the fee directly to the
hospital. For each payment, a physician code is entered. As a result, the total fee collected against
individual physicians can be obtained over any period of time. At the end of every month, or week, a
fixed percentage of this total fee is paid to the physician. In addition to this, the physician may get an
incentive amount based on volume of patients consulted. This may be shown diagrammatically as
given below.
surgical patients
(a)
> pays to hospitals
' /
(b)
pays anaethetists
< <c)
(d)
pays physicians (OB&GYN or general surgeon)
There is here a two-way transaction between, in contrast to the one-way flexible fee payment
arrangement. Under this fee sharing system, the hospital first collects the fees from the patient and
then shares them with physicians on a certain agreed basis (arrow direction from b to d). The
transaction flow from physician (a) to hospital (b) remains the same as in flexible fee payment
arrangement.
3. Characteristics and Structure of the Private Hospital Sector
I:
29
3.4
Competition and Market Strategies
Most physicians opined that providers in general are aware of the charges prevailing in the
market for comparable types of services offered by various hospitals. Providers use this knowledge
rather than unit cost of provision, to fix their own charges for various services. The study therefore ’
decided to obtain a picture of the prevailing charges for certain services, and so asked hospitals to
provide charges for a number of services/procedures, mostly related to maternity services since this is
the focus of the study. (Table 15 shows the summary statistics22). It is important to note that tins
in ormation is very difficult to collect since providers consider it very sensitive. .' In spite of much
time and effort to convince them of its value to the study, only a few came forward to provide such
information. However, even this limited information is extremely helpful in understanding the overall
characteristics of the private sector.
S
overall
and tpZenU
3.4.1
Charges: Aggregate Level
‘
1 ’ 3’5’
in Table '5)’ 3 Urine test costs is least expensive,
IPC R r
EC?r Ultrasound for pregnant women costs an average Rupees (Rs) 281 per
. But the coefficient of variation (cv) for an ECG is lower (32.29 percent) than that for a
urine test and ultrasound (40.48 percent and 39.22 percent, respectively).
‘
r,e?‘ed SerriCeS’ °Peration theatre (OT) charges are highest on average
( .706 cw 46.15 percent), followed by anaesthetist’s fee per delivery (Rs.542 cv38 78
sSd Iaborroom charges (Rs.372, cv: 50.01 percent). As with the three diagnostic
services discussed above, the cv’s for these services all are less than 50 percent.
ery few hospitals reported having new-bom critical care services. Maternity homes are
expected to provide these services, which include provision of incubator facility radiant
warmer, oxygen bag, resuscitation kit, etc. Many hospitals may not have them as one
separate unit others have only an incubator and/or oxygen supply. As Table 15 shows
oxygen supply is provided by 27 hospitals, while only seven reported having incubator
facility and comprehensive new-bom critical care services. The charge for comprehensive
critical care varies from Rs.100 to Rs.1500 per day per baby, with an average of Rs.514 (cw
04 96 percent). Incubator service per day has an average of Rs. 139 (cv: 106.61 percent)
while oxygen supply per hour is Rs. 61 (cv: 111 percent).
“ In fact, the sun/ey sought information on a much longer list of procedures (see Hospitals questionnaire item 47 Appendix A)
is neceXTo “u TurXe “1 h0”? "7"
Whi'e C°mPadn9
nature of seUces ^ U^XnaZ
" " en'S'nO'"
30
--vices across hospitais. it
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
Table 15: Charges for Various Services (in rupees)
S.No.
1
2
3
4
5
6
7
8
9
w
111
Services
Urine test (pregnancy related)
Oxygen per hour
ECG
X-ray (pregnancy related)
Foetal monitor
Incubator per day
Ultrasound (pregnancy related)
Labor room charges per delivery
Newborn critical care
Operation theatre per delivery
| Anaesthetist per caesarean delivery
3.4.2
Mean
(Rs.)
53.41
61.41
71.84
118.13
124.17
139.29
281.48
372.37
514.29
706.06
541.67
Min.
Max.
Median
coeffiient of
variation
N
10
10
30
60
30
25
75
50
100
50
75
100
300
150
500
500
450
550
750
1500
1500
1000
50.0
30.0
60.0
100.0
62.5
100.0
250.0
350.0
200.0
750.0
500.0
40.08%
44
27
111%
32.39%
87.58%
103.34%
106.61%
39.22%
50.01%
104.96%
46.15%
38.78%
49
16
18
7
27
38
7
33
27
Charges: “Poor” and “Better-off” Neighborhoods
To better understand the nature of private hospitals market, it is necessary to analyze the
variations in charges across areas classified broadly as poor or better-off—more precisely, to examine
“whether charges prevailing for a given set of services in poorer areas are lower than those in betteroff areas.” The survey data allows a preliminary analysis of this issue.
As noted earlier, North Madras is considered a highly underdeveloped area compared to South
Madras. North Madras (“poor” neighborhood) is the more densely populated, by persons of lower
socio-economic status, whereas South Madras (“better-off’ neighborhood) residents are largely of
higher socio-economic classes. It should also be noted that all six corporate public limited hospitals
discussed earlier are located in South Madras, along with a small number of public hospitals, while
North Madras has a larger number of (tertiary) government hospitals.
This analysis considers all the sample hospitals surveyed in these two neighborhoods as
representative of private hospitals in the respective markets they serve. A total of 23 hospitals in
North Madras (bed size 20.78) and 25 hospitals in South Madras (bed size 20.33) were covered by the
survey. The mean charges for various services across these two neighborhoods are shown in Table 16.
The figures show that for four of the maternity related services limited, there is no statistically
significant difference in the mean charges for services in poor and better-off neighborhoods. Only for
the diagnostic urine test and ECG are charges higher in better-off regions. It is particularly important
to note that for services/facilities provided at the time of deliver)', there is hardly any difference in
charges between the two regions.24
Given the prevalence of large public hospitals and the lower socio-economic conditions in North
Madras, one might expect lower charges than in better-off South Madras. But it appears not to be so.
The lack of difference in charges for these services is perhaps an indication of intense non-price
competition among private hospitals in Madras as a whole.
24 The charges for many other services are not considered in view of lack of response from hospitals
3. Characteristics and Structure of the Private Hospital Sector
31
Table 16: Comparison of Mean Values (in Rupees) for Select Services across “ Poor” and
“Better-off” Neighborhoods
S.No
1
2
3
4
5
6
Service items
North Madras
“poor”
neighborhood
South Madras
“better-off”
neighborhood
Do mean values
differ significantly
across
neighborhoods?
Ultrasound
(pregnancy related)
210.7
273.0
No
SD‘: 132.1
SD: 48.4
t = -1.21
N“: 7
N: 13
p = 0.268
43.7
63.4
Yes
SD:13.4
SD: 21.8
N:15
Urine test
(pregnancy related)
ECG
Labor room per
delivery
OT per delivery
Anesthetist per
delivery
SD: Standard Deviation **N: Sample size
32
t
-3.01
N:16
p = 0.005
58.4
74.1
Yes
SD: 14.9
SD: 20.9
t
-2.46
N:16
N:17
P
0.019
350.0
353.3
No
SD: 162.0
SD: 198.6
t = 0.04
N: 9
N: 15
P
0.967
704.5
653.8
SD: 326.7
SD:247.9
N: 11
N:13
p = 0.670
536.1
536.3
No
SD: 250.3
SD.-145.0
t = 0.00
N: 9
N:11
p = 0.99
No
t
0.43
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
4. Conclusions
This study has highlighted a number of policy issues which relate to potential strategies to
improving the access to and performance of the private hospital market in Madras city, and in other
large urban areas in general.
Policymakers are debating several issues about the private hospital sector in the state. Central
questions include: (1) Who should govern the private hospital sector? (2) What should be governed
and to what extent? and (3) By what process should governing be carried out? These three questions
are relevant to designing specific policy measures to improve access to care and performance of the
hospital sector. Of the three questions, the first has not yet been resolved. The medical community is
against any form of regulation by the government and instead supports what it calls “selfgovernance.” The debate on this issue is outside the scope of this study. But regardless of who
governs the private hospital sector, the other two questions will demand considerable study for further
policy initiatives. The findings of this study relate to the second question, “what should be governed
and to what extent?” Some findings point to specific policy options, others to the need for further
studies.
1. No physical standards currently exist for private hospitals. As a result, available data on space
utilization (for example) does not help assess their adequacy. It is important to recognize the
prevailing practice in space management in private hospitals and make initiatives to improve overall
quality of care delivery by them.
2. The study emphasizes the importance of estimating adequacy of health personnel in private
hospitals. Assessment is constrained by lack of norms for staff requirements (doctor-nursing ratio,
nursing per bed, etc.) within individual hospital units. For example, in some categories of medical
staft, the deficiency may be due to lack of adequate number of medical professionals being trained. In
other categories (such as nursing), the inadequacy may be due to deliberate policy of the providers to
replace professionals with lower-level staff. In a sense, this also related to the larger manpower policy
issues at the state level. There is concern now among the policymakers as to whether the number of
health professionals should be restricted or increased and, if so, by how much. The government lacks
reliable data on the present stock of health professionals in the state. As a result, the government is
unable to devise any meaningful policy measure. The study thus highlights the need to undertake a
study on (he growth, size, and distribution of health professionals in private sector and think further
on how far above or below the requirements they are at present and devise policy to achieve
appropriate personnel supply.
3. There is constant criticism that a large number of government doctors are often busy
practicing in private hospitals during public office hours. While empirical data on this practice is not
available, there is very little denial of it from government doctors themselves. This study attempted to
establish the dependence of private hospitals on public doctors. Given that public sector physicians
are in demand in many private hospitals, it is necessary to design policies to benefit both private and
public health sectors. One policy option could be to identify specialties in high demand in the private
sector and develop specific measures to moderate their practice. Additional components of this policy
could include: (1) asking public sector physicians to share fees with government since he/she is
allowed to practice in private hospitals and (2) limiting the number of public sector physicians
allowed to practice in private hospitals based on mutually agreed criteria. Another possible but less
4. Conclusions
33
realistic option is to ban private practice of public sector physicians; this will be met with intense
resistance from the medical community and perhaps groups with influence on policymakers. Such a
policy option, if enforced, would achieve one result: Government doctors would not be practice in
private premises during their government hours. But, whether that would ensure substantial
improvement in the provision of care within government premises during those hours is not
automatic.
4. Another important policy issue concerns the payment mechanism prevalent in the hospital
market. The current payment system provides an incentive for physicians to over-provide care
depending on patients economic conditions. Therefore, the relevant policy issue is to contain such
over-provision. Several physicians expressed their concern over the tendency for providers, motivated
by monetary considerations, to refer patients to diagnostic centers and/or higher tertiary hospitals.
One policy resolution is to make such referrals illegal, particularly if the physicians have a
financial stake in the referral centers. It is very difficult to implement such a policy, but it is also
difficult find a rationale to allow such a practice to continue. Fixing rates for physician services
cannot contain costs since it is likely to increase the quantity of services provided. One thing is
certain: Payment mechanism is perhaps the most tricky, sensitive, and intractable issue and the
networking prevalent amongst themselves and diagnostic centers even more intractable empirically.
To address such issues, it is necessary to understand the private sector physician market in order to
evaluate various policy options on payment methods, as third party payers are likely to play a
significant role in India in the future. More importantly, the state must define its role with regard to
financing, provision, regulation, and many others issues. It must also define its commitment to
protecting at least the poor since this will affect whether the current practice is to be contained or
encouraged. As noted in the introduction, there is no state level and national level policy statement on
how the private hospital sector should be promoted and developed. Such policy should guide largely
what needs to done and how they should and could be achieved.
5. The study also throws open the question of restricting the growth and distribution of hospitals
and beds across various zones in the city. While this may not be possible at present, it should however
orm a part of the reform debate in future. As part of the strategy, incentives can be given for
establishing private hospitals in under-served areas. This should be considered along with other
strategies for promoting private hospital sector in the city and the state (see also point 7).
6. Evidence suggests that physicians and hospitals are knowledgable—through informal
networks rather than organized agencies—of each others’ charges for comparable services. It is
difficult to say to what extent such information influences a provider’s pricing policy, but interviews
with a number of providers/physicians confirm that they often use such knowledge in fixing their
charges. It would be enormously useful for policymakers to have access to this information. For
example, such information could be shared with patients/consumers, for use in selection of providers.
Perhaps the government, in collaboration with the private hospitals could create a separate hospital
in ormation agency for collection of such information, which could then be used to design appropriate
policy to promote development of private health sector. Needless to say that such an effort requires
confidence building on the part of the government, for the private sector is always suspicious of any
initiative by the government. This leads to the following point, a suggestion that relates to the larger
issue of the role of state in promoting private health sector—controversial not only in Tamil Nadu but
in other states as well.
. Several independent physicians and hospitals expressed concern over the “intense competition
,n-ueum^et and how’ as a result’they are “not doinS we" financially.” Although not substantiated
with hard data, it cannot be discarded as a deliberate attempt by all providers to project such a
34
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
(•
negative picture of the hospital market. There is little argument that much of hospital market’s
performance is driven by the larger politico-economic policy environment, which is beyond
stakeholders’ reach and influence. But efforts can be made from both within and outside the health
care system for better performance in delivering care and in monetary terms. For example, private
hospitals could voluntarily initiate steps to develop networking among themselves and develop
physical standards by involving various stakeholders in the process. On the other hand, the state
could, for example, initiate steps to revive the sick hospitals wherever necessary. In India, there is a
long tradition of the state providing a helping hand to small industrial units, particularly when they
fall sick. In fact, many providers cited this role of the government in other sectors of the economy and
questioned why they have not received such support from the state. The state could perhaps create a
separate body—a “state private health sector development agency’’—concerned with developmental
needs of the private health sector in the state. This Agency should help ensure adequate quality of
care in the private hospitals and not act merely as a liaison body between the government and private
sector.
<
4. Conclusions
t
35
I
Annex A. Survey of Hospitals, Clinics and
Nursing Homes
IIT/BGI/97-98
Questionnaire ID #
Survey of Hospitals/CIinics/Nursing Homes
l am from a Social Science and Environmental Research Group by name "The
Blackstone Group of India", which is located in Madras. Presently, we are doing a
research survey on private hospitals, in assoication with the Department of Humanities
andSocia! Sciences, Indian Institute of Technology (Madras). In this connection, we
would like to ask you a number of questions regarding your hospital. I will be thankful if
you could spare some time to answer these questions. The information you provide will
e kept strictly confidential and will be used for the purpose of conducting a research
HOSPITAL DETAIL
Name of hospital
Street Address.
PIN:
Zone Number
Division Number
PARTIUCLARS OF RESPONDENT
Name of the respondent.
Designation of the respondent
Telephone number of respondent.
Key names at facility for possible follow up:.
Annex A. Survey of Hospitals, Clinics and Nursing Homes
37
INTERVIEWER’S DETAIL
Interviewer
code
Initial contact was:
I
I a) Assisted by a contact
|
| c) Scheduled in person.
|
| e)Unscheduled/unnotified
b) Scheduled by telephonec.
d) Notified through a letter.
date of interview
day
Time started
Time completed
date of 1st follow up
date of 2nd follow up
Outcome: (1 )Completed/ satisfatory , (2) completed / unsatisfactory (3) Incomplete
Supervisor’s Name:
38
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
General Information
1 .Year of Establishment
2.Number of beds (when established)
3.Number of beds (as of now)
4. Which of the following categories best describes your hospital ?
a) Private (for profit)
b) Private (philanthropic, non-missionary)
c) Private-missionary'
d) any other
5.If private, state form of ownership
(a) Sole proprietorship
(b) Partnership
(c) Corporate Private Limited
(d) Corporate Public Limited
(e) Owned directly by employer
6.Do you own this building
1 yes
2 No
if no, is it on
a) rent ?
b) annual lease?
c) any other arrangement (mention below briefly)
Annex A. Survey of Hospitals, Clinics and Nursing Homes
39
code
#
Department /
Speciality
al
I Bums
a2
Cardiology
aJ
Cancer
a4
Cosmetology
~a5
Dentistry
a6
Dermatology
a7~
Diabetology
aS
a9
a!3
General Surgery
a!4
Gastroenterology
715’
Geriatrics
al6
Haemotology
No (2)
Family Welfare planning
Nephrology
Neurology
Neurosurgery
Neonatalogy
~a2]~
Oncology
722 ~
Opthalmology
a23~~
Obstetrics & Gynaecology
a25 '
Yes (1)
Emergency services
776“
724”“”
Whether surgery is
also performed
Endocrinology
General Medicine
7’19”
No
(2)
”” ENT
~aT6
~aTT
all
717
aTs~
(Yes
(1)
Orthopaedic
Paediatrics
726 ~ Pathology
727
Physiotherapy
a28””
Psychiatry
a29”“~
Radiology
40
Characteristics and Structured Pnvate Hospital Sector in Urban fndia: A Study of Madras City
code
#
Department /
Speciality
a30
Rhumatology
a31
STD
a32
Traumatology
a33
Tuberculosis
a34
Urology
a35
Vascular surgery
Yes
(1)
No
(2)
Whether surgery is
also performed
No (2)
a36
a37
a38
Annex A. Survey of Hospitals, Clinics and Nursing Homes
41
8. Please indicate whether the following facilities are available in your hospitals.
code #
Facilities
bl
Treadmill analysis
b2
Contact lens clinic
b3
ECHO cardiography
b4
Holter Monitor
b5
X-ray
b6
Eye testing
b7
ECG~
b8
Gastroscopy
b9
Ultra sound
blO
Allergy test
bll
Laproscopy sterilisation
b!2
Blood Bank
bl3
Endoscopy
b!4
ICCU
bl5
Bio-chemistry lab
b!6
Dental care (extraction, dentures etc)
b!7
Peritonal Dialysis
b!8
Haemo Dialysis
bl9
Traction
b20
Pap smear
b21
Cancer screening
b22
Foetal monitor
b23
Hormone test
b24
Lithotriper
b25
Bronchoscopy
b26
Ventilator
b27
Newborn Resuscitator
b28
Refrigirator for vaccines
b29
Ice-liner refrigirator
b30
Autoclave sterilisation
42
Yes (1)
No (2)
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
code #
Facilities
b31
Immunisation
Annex A. Survey of Hospitals, Clinics and Nursing Homes
Yes (1)
No (2)
43
Facilities/infrastructure.
”mb" °f r
u-nder e’c" c"“gory ““
printed list prices. If the format given below is not suitable for your
hospital, collect infonnation the way it is provided. Attach separte sheet of paper if necessary. Get ward
categories, number of beds in each category, and charges for a bed per day in each category)
Ward/Room Category
Number of beds in each ward
Bed/room charge per day
10.Number of floors in the hospital
(Give total floor space, all floors included
(including ground floor)
. sq. feet)
11 .How many operating rooms are there in your hospital ?
(mention floor levels)
Floor level
Number of Operating rooms
Ground floor
First floor
Second floor
Third floor
Fourth floor
Fifth floor
Sixth floor
44
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
12.Do you have an emergency ward ?
1 Yes
2 No
13. Do you have an ICU?
1 Yes
2 No
14. Number of beds in ICU
(if more than one ICU, mention beds ICU-wise)
15. Location of ICU (mention the floor)
16.What is your principal source of water and quantum of water used per day?
quantum
Source
(Specifiy units)
1
2
3
4
5
Public Water System
Well with pump
Metro water supplied thro’ tankers
Purchased from private supplier...
Other (specify)
17.Do you have a overhead tank
1
2 No
Yes
If yes, what is the capacity of the overhead tank
(litres/gallons, specify)
18.Do you have Aquaguard?
1 Yes
2 No
19.Do you supply hot water for bathing?
1 Yes
2 No
1 Yes
2 No
21 .Does this hospital have an elevator?
(specify number if more than one is available)
1 Yes
2 No
22.Does your hospital have a drainage connection?
1 Yes
2 no
I------- 1 1 Yes
2 No
20.Do you have a generator for power supply?
23.When did you get the drainage connection (specify year)
24. Is there a laundry?
25. Does your hospital have space for washing patients’ cloths?|
1 Yes
2 No
26.Does your hospital have play-area for children?
1 Yes
2 No
27.Has your hospital been declared baby-friendly by
the government of Tamil Nadu?
1 Yes
2 No
28.1s there a pharmacy within the hospital premises?
1 Yes
2 No
29. Does it store breast milk substitutes?
1 Yes
2 No
|
If yes, when was it declared baby-friendly? (mention year).
Annex A. Survey of Hospitals, Clinics and Nursing Homes
45
30.How many ambulance vans does your hospital have?
31. Do you hire ambulances?
1 Yes
2 No
If no, go to question 34
If yes, how many on hire
32.Who gives you on hire?
33.How mu'ch do you pay for hiring ambulances?
(give details of nature of payment arrangements; whether it is based on per trip, per day basis, monthly,
lump sum plus charges per trip, any other arrangement, specifcy)
34.Do you have any contract with other hospitals (for referral purposes only)
[
] 1 Yes
[
2 No
If No, go to question 35
If yes, mention those referral services and names of hospitals
S.No
46
Name of hospital
Referral service
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
35.Do you have any contract with diagnostic centres:
1 Yes
2 No
If No, go to question 36
If yes, which of the following services are referred to an outside diagnositic centres (please mention
name(s) of referral centres, with address)
S.No
Referral Services
a
CT scane
b
MRI
c
Treadmill
d
X-ray
e
Endoscopy
f
Laproscopy
g
Dialysis
h
Angiogram
i
Ultrasound
J
Foetal monitor
Referral centre (s) and address
Annex A. Survey of Hospitals, Clinics and Nursing Homes
47
36. Hospital personnel: Physician profile
S.No
Name of
Physician
Sex
M/F
Speciality
mention
qualification
Consulting days and hours
Hours
Days*
a. in
1 Monday 2: Tuesday 3: Wednesday 4: Thursday
48
S.Friday
6:Saturday
p.m
7: Sunday
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
37. Do you have government doctors serving as consultants?
(If yes, mention only the number of doctors under each specialties)
S.No
Specialty
1 Yes
2 No
Number
38. Give a list of hospital staff other than physicians such as nurses, technicians, ayas, social workers.
S.No
staff
designation
qualification
number
Annex A. Survey of Hospitals, Clinics and Nursing Homes
S.No
staff
designation
qualification
Number
49
Maternity services:
39.Does this hospital admit only maternity cases?
(if yes, go to question 41)
1 Yes
2 No
40. If no, do you have separate maternity ward?
1 Yes
2 No
If yes, number of beds in the maternity ward
41. Number of deliveries: (mention exact reference period)
type of delivery____
last 1 year
last 1 month
Normal (vaginal)
last 7 days
Caesaren
Instrumental (forceps)
Total
42.1s yourhospital recognised by the government for Family Welfare serivices?
1 Yes
_____ 2 No
43. Do you receive any support from the government?
------- 1 Yes
------- 2 No
If yes, specify nature of support (grants for construction or improvement of hospital)
44. Do you screen for disablement in newborns for early intervention?
1 Yes
50
2 No
Characteristics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
45. Please provide charges for following items under various types of delivery ward-wise.
Type of delivery
and Ward Type
I.Vaginal normal
Ward type
Nursing
(Rs)
Labour room
(Rs)
Anaesthetist
(Rs.)
Physician
(Rs.)
J_________
2
3
4
5
6
II. Caesarean
Ward Type
J______
2
3
4
5
6
III. Instrumental
Ward Type
J________
2
3
4
5
6
Annex A. Survey of Hospitals, Clinics and Nursing Homes
J
51
46. Please provide information on the number of procedures performed
S.No
Procedures
a
tubectomy
b
hysterectomy
c
laproscopy (gynec. )
d
dilation and curettage
e.
cholecystectomy
f.
Prostectomy
f
Hernia
g-
Hydrocele
last one year
(mention exact
reference months)
on the following:
last one month
(mention
reference month)
1
47. Please provide charges for the following services.
Services
Rs.
(if a services is not provided, please state so)
1 .X-ray (pregnancy re 1 ated)
2. Ultrasound (pregnancy related)
3. Urine Test (pregnancy related)
4. ECG
5. Foetal monitor.
b.Cervical smear test..
7.Laproscopy (diagnostic)
8.Incubator charge (per day)
9.Labour room charges.
IQ.Operation theatre charges (for delivery)
11 .Oxgen charges (per hour), (or if unit of
charge is different, specify)
12.1 C U room charges (per day)
13. Anaesthetist (per procedure for delivery)...
14. Hernia (operation charges)
15. Hydorcele (operation charges)
16. Prostectomy (operation charges).
17. Vaginal Hysterectomy (operation charges)
18. Newborm critical care.
52
Charactenstics and Structure of the Private Hospital Sector in Urban India: A Study of Madras City
General questions:
48. Do you have any contract with any private or public sector company for treating their patients?
(give details of your contracts) mention names of companies if possible, duration of contract, payment
modes, fee structure if declared, etc)
49. Does your hospital have a published fee schedule for
room and board charges
□ 1 Yes
laboratory procedures
□ 1 Yes
consultations
□ 1 Yes
any package deal/health scheme9
□ 1 Yes
(collect details of these schemes)
(collect a copy of these charges if available)
□ 2 No
□ 2 No
□ 2 No
□ 2 No
50. Can doctors in this hospital set fee levels by themselves?
□ 1 Yes
□ 2 No
*******
Dr Muraleedharan would like to meet you at a later point of time for further
discussion. He will get in touch with you in this regard for an appointment.
Thank You
Annex A. Survey of Hospitals, Clinics and Nursing Homes
53
Annex B. Points for Discussion with
Physicians
POINTS FOR DISUCSSION WITH PHYSICIANS
(used by the Principal Investigator and Researcher)
The focus of discussion should be on employment status and payment system. You may ask her/him to
fill in a brief questionnaire if necessary and ask him/her to mail it to you.
On his/her employment status
with government: salaried, any other arrangements.
with private hospitals (salaried, any other arrangements)
In hospitals you visit as consultant (or as regular physician), what is the method of payment?
(do you charge them directly, do you get paid on the basis of the number of patients you consult, does
what you get paid depends upon volume of IP and OP, can you fix your own fees, any basis of sharing
fees contracted, if so could you give the basis of sharing?. Any other incentives?
What is more prevalent payment mode and what the usual incentive schemes offered?
What system of payment would you prefer?
What are your views the state of private sector? Is there an intense competition in your area of
specialization? How do they try to price their services?. Will banning private practice adversely affect
availability of specialists in private sector?.
Annex B. Points for Discussion with Physicians
55
Annex C. Bibliography
Bennett, S. and V. R. Muraleedharan. 1998. Reforming the role of government in Tamil Nadu health
sector. Research paper 28. Development Administration Group. School of Public Policy, University
of Birmingham.
Bhat, R. 1993. “The private health sector in India.” In Berman P and M. E. Khan (eds.) Paving for India’s
Health Care (pp. 161-96). New Delhi: Sage.
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Annex C. Bibliography
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