innovation in health care delivery system a tool to...

INNOVATION IN HEALTH CARE DELIVERY SYSTEM – A TOOL TO

ENRICH THE SERVICE QUALITY

Abstract:

Healthcare is a vital service that daily touches the lives of millions of Indians at significant and

vulnerable times; birth, illness and death. In the recent decades, technology, pharmaceuticals and

know-how have substantially improved how care is delivered and the prospects for recovery.

This paper aims at discussing the healthcare systems in India and role of the healthcare systems.

The proper role of competition in healthcare markets has been debated. This paper addresses two

basic questions. First, what are the current trends of healthcare delivery, and how can it be

enhanced to increase consumer welfare? Second what are the drivers for healthcare innovation,

how Public Private Partnership plays an important role in healthcare delivery.

Key Words:

Healthcare Delivery, Quality improvement, Public health, health technology

JEL Classification: I18, O31

Introduction:

World Health Organization (WHO) defined Health is a state of complete physical, mental, and

social well being and not merely the absence of disease or infirmity.

Health Services is a system of institutions, people, technologies, and resources designed to

improve the health status of a population. Also the services provided to the population, e.g.

curative, preventive, promotive, etc.

A health–care–system comprises all the organizations, institutions and resources that are devoted

to producing health actions and outcomes. Health systems are constituted, on the one hand, by a

system of care with the aim is to correct health problems, prevent their appearance and conceal

their consequences. On the other hand, they are formed by a system whose goal it is to promote

the health of populations.

The quality of healthcare services may mean different things to different people. Administrators

may focus on the structures, such as the availability of operating rooms or laboratory services.

Clinicians may focus on the process, such as the technical competence of the practitioners.

Patients may focus on different types of processes like the personal relationships and their

personal satisfaction. External reviewers may focus on the outcome – lives saved or diabilities

prevented. The National Committee for Quality Assurance (NCQA) has developed a widely –

recognized framework to assist with the challenge. The following table outlines the framework.

Characteristic Meaning How measured?

Access and

Service

Access to needed care and good

customer service

Patients satisfaction surveys,

Patient grievances and follow-

up, interviews with staff.

Qualifies

providers

Personnel licensed and trained and

patients satisfied with services

Presence of system for

checking credentials

Patient satisfaction surveys

Staying healthy Quality of services that help people

maintain good health and avoid illness.

Review of independently-

verified clinical records

Review of responses from

patients

Getting better Quality of services that help people

recover from illness



Interview with staff

Living with

illness

Quality of services that help people

manage chronic illness



Interview with staff

Source: Data from NCQA health plan report care. Available at: http://www.ncpa.org/

Patients/clients and the general public often complain about the poor quality of care about health

facilities. We often hear on the radio, television and even in the community about the poor

quality of care that patients have received from us. We ourselves experience this poor quality in

our health facilities when we are sick. Although we have few resources and may be short of staff,

we can do something about the poor quality of healthcare.

Indian Government has classified the Indian health infrastructure majorly into two categories 1)

Public Healthcare Providers 2) Private Healthcare Providers.

http://www.ncpa.org/

Primary Health Care is a vital strategy that remains the backbone of health service delivery. India

was one of the first countries to recognize the merits of Primary Health Care Approach (PHC).

Community Development Program was launched in 1952 for the all-round development of rural

areas, where 80% of the population lived. Community Development was defined as “a process

designed to create conditions of economic and social progress for the whole community with its

active participation and the fullest possible reliance upon the community’s initiative”.

Ideally the presence of public health care should take care of both the ability to pay and ability to

process information on the quality of health care. But it so happens that especially for those

residing in the smaller and far off villages, many public services are out of reach geographically

and often such consumers are left with their needs unmet. The private sector cannot emerge in

such areas because of lack of adequate scales. In other words, more important than the price is

the issue of geographical accessibility for many rural residents. Lack of physical infrastructure

and staff both contribute to this problem of access. The private sector is filling the unmet need to

an extent and this role is rapidly expanding. Today private sector healthcare provision in rural

areas is greater than that by the public sector. The private sector is not only filling the gaps left

by the public sector but is also emerging as the key player in terms of service provision.

While the Indian Healthcare sector is on the edge for growth in the next decade, it is still

weighed down by various issues and challenges:

1. Dual Disease Burden:

Urban India is now on the threshold of becoming the disease capital of the world and

facing an increased incidence of Lifestyle related diseases such as cardiovascular

diseases, diabetes, cancer, COPD etc.

At the same time, the Urban Poor and Rural India are struggling with Communicable

Diseases such as tuberculosis, typhoid, dysentery etc. Rural India is also seeing a higher

occurrence of Non-Communicable Life-style related diseases. This represents a serious

challenge that the Indian Healthcare system would need to address

2. Lack of Infrastructure and Manpower: Accessibility to healthcare services is extremely

limited to many rural areas of the country. In addition, existing healthcare infrastructure is

unplanned and is irregularly distributed. Further, there is a severe lack of trained doctors and

nurses to service the needs of the large Indian populous.

Review of Literature:

Many researchers had done research on Service Quality in health care, and proposed different

models theories. Some these were reviewed to understand Service quality dimensions and useful

for measuring service quality in healthcare delivery.

Emin Babakus and W. Glynn Mangold (1992) conducted a study to evaluate SERVQUAL

instrument, and results indicate that the scales can be successfully used to assess the magnitude

of the gap between patient perceptions and expectations. SERVQUAL, a standard instrument for

measuring functional service quality, is reliable and valid in the hospital environment and in a

variety of other service industries. SERVQUAL also provides hospital administrators with a tool

for the measurement of functional quality in their own organizations.

Rob Baltussen and Yozoume Ye (2006) extended the study using the SERVQUAL tool

developed by Emin Babkus and W.Glynn. According the authors both users and non-users were

favorable about health personnel practices and conduct, and about healthcare delivery. They

were less favorable about adequacy of resources and services, and financial and physical

accessibility of care. Both groups were very negative regarding the availability of drugs. The

study in Burkina Faso, states that financial accessibility is a key determinant of patient initiation

of uses of modern health services. And supplementary findings show that patient retention

merely depends in people perception of other dimensions of quality.

J. K. Sharma and Ritu Narang (2011) used the questionnaire tool developed by Rob Baltussen

and Yozoume Ye (2006). Study found that the quality of primary healthcare services in rural

areas of Uttar Pradesh, India, some interesting differences in user perception regarding service

quality components that impacted their intention to repeat visit and how they varied between

different healthcare centers and according to the demographic status of the patients. The study

found that with improved income and education, the expectations of the respondents also

increased. And it was surprising to observe that illiterates and those with less education did not

consider financial and physical access to the centers important and were willing to travel great

distances for the treatment.

Tomas Pantoja, Marcela Beltran and Gladys Moreno (2009) conducted a questionnaire validation

study of patients’ perspective in Chilean primary care. They used a combination of text words

and MeSh terms in PubMed related with primary care/general practice, patients’

perspective/satisfaction and instrument/questionnaire and prepared a Health Center Assessment

Questionnaire (Cuestionario de Evaluacio´n de su Centro de Salud, CECS). The instrument

includes several aspects that have been considered key in the assessment of patients’ satisfaction

in different countries, such as infrastructure, continuity, communication with different health

professionals, satisfaction and the way in which the center deals with the patients’ health issues.

The results suggest that the CECS is valid and reliable.

Hardeep Chahal (2008) conducted a study to find the relationship between patient loyalty and

service quality. The patients in general develop loyalty towards providers based upon the

significant interpersonal experiences they have with the doctors and nurses, and about the

operational quality of the hospital. The patient loyalty measure UPAS, UPAD and RPO was

asses by using eight significant predictors- overall satisfaction with the physicians and nurses,

overall physician and nurses’ quality, overall cleanliness, overall administration, atmospheric

environment and technical services. The results state that patients’ experiences have an impact

on overall satisfaction, service quality and intentions to use the unit again and recommend it to

others. And healthcare services need to take a fresh competitive look at their objectives and

incorporate patient relationship management philosophies to improve their image, increase

patient and employee satisfaction and loyalty as an ultimate step.

Theories:

Innovation in healthcare delivery systems (Vincent K.Omachonu, Norman G.Einspruch, 2010) a

conceptual framework helps in understanding the dimensions of healthcare innovation, the

process of healthcare innovation. Innovation in healthcare are related to product, process or

structure (Varkey, et al, 2008). Healthcare innovations can be defined as the introduction of a

new concept, idea, service, process, or product aimed at improving treatment, diagnosis,

education, outreach, prevention and research, and with the long term goals of improving quality,

safety, outcomes, efficiency and costs.

Figure 1 shows purpose of the healthcare organization i.e., treatment, diagnosis, prevention,

education, research and outreach.

Figure 1: A Conceptual Framework for Innovation in Healthcare

Source: Vincent K.Omachonu, Norman G.Einspruch (2010). Innovation in Healthcare Delivery

Systems: A Conceptual Framework, The Innovation Journal: The Public Sector Innovation

Journal, Volume 15(1), 2010, Article 2.

While serving theses purposes healthcare organizations should effectively manage the quality

they provide, cost effective, safety, efficiency and outcomes. The core items of healthcare

innovation are the needs of patients, the healthcare practitioners and providers. Three main areas

where the healthcare innovation has to focus are a) how the patient is seen, b) how the patient is

heard, and c) how the patient’s needs are met.

The Process of Healthcare Innovation:

Figure 2 illustrates the process of healthcare innovation. And a managed care company may have

confidence upon feedback from patients, physicians and staff, and both groups may have

confidence on information regarding competitors in order to commence the search for

improvement. In some cases, the limitations in the resources available to the healthcare

organizations force them to partner with a healthcare innovation company to create a product that

meets their needs.

Healthcare Innovation

Quality Costs Outcomes Efficiency Safety

The

Pat

ient

How the patient

is seen

How the patient

is heard

How the

Patient’s needs

are met

Treatment

Diagnosis

Prevention

Education

Research

Outreach

Hea

lthca

re

Pra

ctit

ioner

s

and P

rovid

ers

Info

rmat

ion

Tec

hnolo

gy

Figure 2: The Process of Healthcare Innovation




First, it creates a service that the market needs. Then it improves the service to meet what the

market wants and demands. This is usually the stage where most services companies assume

they have reached the goal. But some rare companies move beyond stage two, they innovate and

devise services that would never even occur to a customer to ask for. They create ―the possible

service. This kind of service cannot be created by asking the question ―what do my customers

want? But rather ―what would they love? This underscores the idea that services innovation is

not always driven by customer input. In order to obtain answers to the question ―what would

they love? Healthcare organizations can examine the interactions between services and

technology. Stage III innovation can be supported by applying a new technology to new service

(quadrant 1), new technology to an existing service (quadrant 2), existing technology to existing

service (quadrant 3), and existing technology to a new service (quadrant 4).

Government

Agencies

Physicians/

Healthcare

Professionals

Patients

Consumer

Advocacy

Groups

Healthcare

Organizations

Innovation

Companies

respond to Needs

Consumer

Needs

Develop and

Market New

Innovation

Develop

& Adopt

Internal

Growth

Innovation

Research &

Development




The Dimensions of Innovation in Healthcare:

There are two principal dimensions of healthcare innovation – environmental and operational

dimensions. These dimensions motivate or affect the introduction of innovation in healthcare

organizations. The operational dimension includes the improvement of clinical outcomes,

efficiency, effectiveness, aging population, nursing shortage, patient satisfaction, profitability,

patient safety, improved quality and cost containment. The environmental dimension includes

physician acceptance, organizational culture, regulatory acceptance, and partnerships and

collaborations. Figure 4 below shows the factors.

The dimensions of healthcare innovation can be divided into two bands – the outer band which

represents the environmental dimensions and the inner band which represents the operational

dimensions. The Environmental Dimensions (ED) includes organizational leadership,

organizational culture, regulatory acceptance, physician acceptance, complexity of innovation,

and partnerships and collaboration. Similarly, the Operational Dimensions (OD) of healthcare

innovation include patient satisfaction, profitability, effectiveness, efficiency, patient safety,

aging population, productivity, cost containment, labor shortage, clinical outcomes, and quality.

Figure 4: Environmental and Operational Dimensions of Healthcare Innovation




Discussion:

Healthcare quality varies from country to country. For example, some health plans, doctors,

hospitals etc., will play a major role in determining the healthcare quality. The institutions play a

major role in delivering care. Hospitals, nursing homes, community health centers, physician

practices and public health departments all are complex institutions that have evolved over the

past century to meet various needs. The role of professionals in running the system is very

important in delivering quality care. Many different types of professionals make the system

work, and each type has distinct roles. Physicians, nurses, administrators, researchers,

technicians, of many types, and business leaders focused on technology and pharmaceuticals all

play essential roles in health care delivery and healthcare innovation.

Developments in medical technology, electronic communication and new drugs had increase

changes in service delivery. New knowledge should be acquired, updated, managed and applied

accordingly, in order to deliver the most appropriate care for patients based on the current best

available evidence. Standardized medical technologies require health professionals, as

knowledge workers, to have updated knowledge to apply these technologies for the benefit of the

patients. Research and Development department play a vital role in innovation of new

technology.

In today’s world private sector is more involved in innovation of new techniques and tools for

delivering healthcare.

Public sector and Private sector has engaged in delivering the healthcare to the public and

healthcare innovation. The future of innovation in healthcare can be greatly improved through

the delivery of high quality healthcare experiences which would complement any new

technological advances.

The private sector has evolved a multi-pronged approach to increase accessibility and

penetration. It has tackled the issue of Lifestyle related diseases with the development of high-

end tertiary care facilities. Also new delivery models such as Day-care centers, single specialty

hospitals, end-of-life care centers, etc. are on the horizon to service larger sections of the

population and address specific needs.

The Public Sector is keen to continue to encourage private investment in the healthcare sector

and is now developing Public – Private Partnerships i.e. PPP models to improve availability of

healthcare services and provide healthcare financing.

Both sectors have also undertaken initiatives to improve functional efficiencies in the form of

Accreditations, Clinical research, outsourcing of non-core areas, increased penetration of

healthcare insurance and third party payers.

Healthcare research is core focus within the healthcare sector. Clinical research in many

specialties has led to improved disease management and patient care, reduced ALOS, better BTR

(Bed Turn over Rates) making healthcare delivery more sustainable. This also significantly

improves the DALY (Disease Adjusted Life Years).

Research in better diagnostic care has been in both laboratory medicine moving to higher

generation ELISA’s, NAT (Nucleic Acid Testing), moving to molecular diagnostics,

immunology and antigen testing, evolving disease markers and so on. On the radiology front too

there have been substantial improvements from traditional methods to computerization, PACS

(Picture Achieved Computerized System), better radiation dose control and so on.

In India, many corporate hospitals and major public hospitals are actively involved in conducting

clinical trials of various drugs. Private corporate hospitals such as Apollo Care, Narayana

Hrudayalaya, Usha Cardiac Institute, Shankar Netralaya, Indraprastha, Breach Candy, and Bayer

diagnostics as well as public hospitals such as All India Institute of Medical Sciences, Nizam

Institute of Medical Sciences and many of the Medical colleges and teaching hospitals are

actively involved in various stages of clinical trials.

The TPA’s (Third Party Administrators) have added to the changing scenario of health insurance

in India. Their role is gradually changing from green field ventures to an established system.

Their wide spread network with hospitals and other healthcare providers have certainly

strengthened the health insurance structure in India. To bring in uniformity and smooth

functioning of the process, the IRDA (Insurance regulatory and development authority) has

directed the TPA’s to formulate standard guidelines and formats for better communication and

transparency in the system.

Conclusion:

The Indian healthcare sector can be viewed as a glass half empty or a glass half full. The

challenges the sector faces are substantial, from the need to improve physical infrastructure to

the necessity of providing health insurance and ensuring the availability of trained medical

personnel. But the opportunities are equally compelling, from developing new infrastructure and

providing medical equipment to delivering telemedicine solutions and conducting cost-effective

clinical trials. For companies that view the Indian healthcare sector as a glass half full, the

potential is enormous.

In the last decade, private participation in the healthcare sector has risen significantly on the back

of increased interest by investors and rising Private Equity and Mergers and Acquisitions (M&A)

activity. Further, the sector has evolved through increased investment in R&D and in the

introduction of specialized delivery models. Healthcare is at an influx of paradigm shifts in terms

of changing disease patterns, increasing dual disease burden for both rural and urban India. On

the supply side there has been uneven distribution of healthcare infrastructure and resources

posing various challenges to the sector. A multi-pronged approach from key stake holders is

necessary to address the issue. Both the public and private sector need to work in tandem to

make healthcare available, accessible and affordable. India would need various solutions towards

this end.

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