Vijay Govindarajan is a professor of international business at Tuck School of Business, Dartmouth College. Ravi Ramamurti is a professor at Northeastern University and director of its Center for Emerging Markets. They are co-authors of the article “Delivering World-Class Healthcare Affordably,” in the current issue of Harvard Business Review.
No matter how the fight over Obamacare shakes out, the biggest challenge facing U.S. health care will remain reducing costs while improving quality of care and access for patients. The experience of a few innovative Indian hospitals may point the way forward.
India’s health-care system as a whole has many problems, but our research has uncovered nine private hospitals that provide quality health care at a fraction of U.S. prices. Most of these hospitals are accredited by the U.S.-based Joint Commission International or its Indian equivalent, the National Accreditation Board for Hospitals & Healthcare Providers. At a hospital where the procedure is performed, a patient would pay $120 for cataract surgery, $250 for a caesarean-section delivery, $2,000 for a knee or hip replacement, $2,000 for an angioplasty, $2,900 for cancer radiation treatment and $3,200 for open-heart surgery — 5 percent to 10 percent of U.S. prices. These private hospitals deliver medical outcomes comparable to that of good U.S. hospitals, as measured by medical complication rates or post-treatment survival rates. Furthermore, they’re profitable.