High women and infant mortality rates continue to burden the developing world. Although international organizations have called for an increased focus on maternal health, more than 500,000 women in developing nations die during pregnancy or childbirth annually. In Asia, one out of every 43 women will die of maternal-related causes, compared to one in 2,500 in the United States. The fifth Millennium Development Goal (MDG) aims to reduce the maternal mortality ratio (MMR) by one-third in the next four years; however, India’s efforts—and those of many developing nations—lag woefully behind. According to PLoS Medicine, between 1990 and 2005, global maternal deaths decreased by only 1% per annum instead of the 5% needed to reach MDG 5. Training programs and technology to dramatically reduce these numbers are widely available, though appropriate funding, infrastructure and resources for maternal health have been lacking in countries that need it the most.
India, for example, has seen tremendous economic growth over the last decade, although government spending on healthcare—less than 2% of GDP (China spent 5.8% in 2002)—has not kept pace. With an estimated US$40 billion market that is expected to grow to US$80 billion by 2013, India’s healthcare sector has seen an increase in private sector investments to fill the quality and supply gap. Currently, private investments account for nearly 80% of the healthcare industry, resulting in a new crop of privately funded and -run hospitals and medical facilities that are changing the face of the Indian healthcare industry.
LifeSpring Hospitals: Specialty Care for Expecting Mothers
Many new private sector health investments are focused on an emerging trend in the industry: the for-profit, single-care facility, which specializes in a particular area—cataracts, heart disease or liver transplants—to increase quality of services, reduce infrastructure needs and costs, and, ultimately, to provide affordable, niche care to patients. This “small but rapidly growing genre” incorporates the process-driven efficiency and results-oriented approach of a private sector franchise model while simultaneously focusing on improved care and customer satisfaction. In the maternal and neonatal care arena, LifeSpring Hospitals Private Ltd., founded in 2005, has emerged as a leader in providing routine obstetric care and delivery services for expecting mothers in urban poor areas of Southern India.
LifeSpring Hospitals, a joint venture by Acumen Fund and Hindustan Latex, offer natural births, caesarian sections and hysterectomies, often at costs 30-50% less than local rates. The for-profit network of maternal and neonatal care facilities pre-screens patients to identify high-risk pregnancies for referral to emergency care centers. The focus on low-risk procedures reduces the need for more advanced technology and infrastructure, and has allowed the company to standardize processes and procedures to reduce costs, improve focus-area training for doctors and nurses, and increase the potential for expansion. To date, LifeSpring has launched nine hospitals, with four more being built by the end of June 2011 and two additional planned for the end of the year.
LifeSpring has become “the largest chain of maternity hospitals in South India,” according to Acumen Fund, “treating more than 70,000 patients and delivering more than 7,000 healthy babies.” The 25-30 bed facilities operate with a cluster head that manages all associated hospitals to reduce overhead within the network. Further, the cluster shares ambulances, vendors and doctors, and is strategically situated in close proximity to neonatal emergency care centers, as well as blood banks. Each hospital has one high-end incubator, a basic lab and a partner pharmacy inside, which offer lower, negotiated rates to LifeSpring customers.
“We operate with basic facilities to keep our costs low,” explains Priya Pingali, an assistant manager of monitoring and evaluation at LifeSpring. “But we don’t believe quality and price conflict.”
The company, which targets the working poor—rickshaw drivers, tailors, street vendors, housekeepers—has also devised a number of different schemes to create a trusted brand name in the areas they operate, thus driving demand. Women from the community are hired to go door-to-door on a daily basis to talk about LifeSpring—to mothers-to-be and non-mothers alike—and invite them to attend a free clinic in areas such as nutrition and breastfeeding and also receive a regular check-up.
Strategic marketing is necessary to run a financially viable hospital and to remain a competitor in the market. Women are often hesitant to visit a private hospital, explains Pingali, because they don’t believe they can afford it. Though a price board hangs outside each of LifeSpring’s hospitals, women tend to be skeptical and believe there are hidden costs associated. Currently, LifeSpring—which believes in full transparency—charges INR 4000 (~US$90) for normal delivery and INR 9000 (~US$200) for C-sections in the general ward. These costs are up from its founding year, 2005, when the price for a normal delivery was INR 1500 (~US$30). The company saw the need to adjust the prices, and within 1.5 years the first hospital broke even.
“Our biggest learning,” explains Pingali, “has been with the cross-subsidy model, which we will no longer focus on going forward.” Although the hospital chain originally offered tiered pricing and gave the option of semi-private and private rooms, few women in their target areas chose to avail of the premium services. Over 90% of LifeSpring patients opt for the general ward, which, unlike crowded public hospital facilities in India, offers a serene, clean setting where each woman has her own area divided by three walls and a curtain. The women prefer the close-knit nature of the general ward set-up. More than 50% of women who deliver their first child at LifeSpring returns for the next child.
Models such as LifeSpring’s are providing much needed, high-quality basic services to expecting mothers, though those most at risk—women with potential complications—are still left out. In all likelihood, these high-risk patients will be referred back into the overburdened public system. While the private sector is filling an immediate gap, the public system simultaneously needs to be invested in and improved. Public-private partnerships are increasingly becoming the focus for alleviating “deficiencies in the public health system” and are also aiming to “reduce economic stress on those who seek services from an expensive, burgeoning and unregulated private health sector.” Higher standards and regulations are needed in the sector to be sure the growing industry remains committed to patients over profit. For now, private-sector models such as LifeSpring are showcasing cost-efficient, financially viable approaches to providing affordable, quality care to the poor. As it expands, their model has the potential to save the lives of millions, and give women the dignified facilities they deserve to bring new life into the world.
The opinions expressed on the Searchlight South Asia site are solely those of the authors and do not necessarily reflect the positions of the Rockefeller Foundation.