The article is from expresscomputeronline.com... good read
http://www.expresscomputeronline.com/20090907/expressintelligententerprise05.shtml
Vertical Focus
Focus On: Healthcare
N Geetha examines the business challenges faced by CIOs in the healthcare vertical and looks at how technology is being used as an enabler.
Escalating growth immunities
Arpan Gupta Principal Analyst, IDC
Thanks to various government stimulus packages in the offing, the healthcare vertical is poised for growth. Arpan Gupta, principal analyst, IDC India stated that the turnover of this industry vertical was Rs 150,000 crores and that it was expected to grow at a CAGR of 20% over the next five years. Urban areas are showing a growth curve, while the rural sector is yet to show momentum in the healthcare sector. However, derivative industries such as healthcare insurance, healthcare services and equipment manufacturing companies are growing strongly.
A report from Technopak Advisors, an independent research body, found that healthcare which was a $35 billion industry in India, was expected to reach over $75 billion by 2012 and $150 billion by 2017. Confederation of Indian Industry found that with this sector growing in a linear fashion and that the demand for hospitals and beds was on the rise. Investments to the tune of $50 billion are expected to be made annually for the next 20 years. The stimulus package by the government as part of its National Rural Health Mission program, which allocated $2.42 billion in its recent interim budget, should drive the healthcare industry in a positive direction.
Another indication from a recent study done by FICCI along with Ernst & Young spotted various opportunity areas for investors in the healthcare sector including medical infrastructure, which would call for an investment of $77.9 billion and medical equipment that is projected to reach $4.97 billion by 2012. Clinical trials are on track to become a $1 billion industry by 2010 while the health services outsourcing sector was expected to grow to $7.4 billion by 2012. Healthcare vertical CIOs are aligning their strategy with the growth of their industry and organization. For instance, Suresh Shenoy, CIO of Wockhardt finds aspects such as economic upward mobility, overall structured healthcare awareness, healthcare insurance penetration, growth in population in general and patients from overseas etc., fuelling growth. "Wockhardt Hospitals witnessed an overall growth of 25% during fiscal 2008-09 and we have set a target of 25% for 2009-10," pointed out Shenoy.
Focus on: Healthcare
Top business challenge: Constrained budgets, growing demand for healthcare facilities, disparate IT solutions, lack of skilled labor and the need for quick turnaround time in order to offer better care to patients
Solution: Focus on advanced IT tools, increase workflow efficiency and improve resource management
How it can help: Healthcare Information Systems (HIS), Clinical research trials tools, EMR, PACS, telemedicine, collaborative tools are some of the IT solutions that are available for this sector
Manish Gupta, CIO of the Rs 100 crore Health Care Global Enterprises Ltd. (HCG), the cancer care provider, viewed healthcare's growth as having a fixed component, which was recession and disease proof and a variable part that depended upon doctors, population, disease breakouts, lifestyles etc.
According to Gupta, the factors that were propelling this sector's growth included individual awareness, collective decisions on healthcare, government push, micro-insurance schemes, public private partnerships etc.
Dr. R S TyagiDeputy Director & Head - Computer Facility, AIIMS
HCG clocked 25% organic growth during fiscal 2008-09 and it has a 40-50% revenue growth target with at least 30% growth in margins targeted for 2009-10. The encouraging factor that Dr R S Tyagi, deputy director & head computer facility of All India Institute of Medical Sciences observed that it was the government's drive towards making existing hospitals into super specialty units, which would result in the extensive use of IT infrastructure.
As for growth, Dr Tyagi maintained that the hospital had been provided with additional land and financial resources to open a second campus on 350 acres of land.
Srikanth Raman, CIO of the Bangalore-based Narayana Hrudayalaya expected explosive growth for hospitals with more facilities coming up in Kolkata and Jamshedpur. "Currently we have a 500 bed accommodation in Bangalore and have a target of going up to 30,000 beds soon," said Raman. Ricky Bedi, CEO of Bangalore-based Teleradtech, the technology arm of Teleradiology Solutions, found that the industry was growing at 15% and that there was an upward movement that would result in hyper-growth of almost 200% within a couple of years.
CIOs opined that it was time to pull up their sleeves in making IT the critical component of the anticipated growth. So far, IT has not made sufficient inroads in this vertical because of the conservative nature of the industry.
Under pressure
Suresh Shenoy CIO, Wockhardt
While CIOs across industry verticals are challenged over how to align technology with growth, CIOs in the healthcare sector face the challenge of convincing the top management that technology can be an enabler for driving business. The adoption of advanced IT tools has been minimal in this sector barring a few top medical institutions. Cost is obviously the deterrent here.
Bedi observed, "My greatest business challenge is to bring down the cost of, and optimize the quality of, care. The end goal is customer satisfaction irrespective of what impact my workflow automation creates."
"How do I evolve the best integrated model for better patient information using any technology, that is the challenge," he added.
The crucial challenge for Narayana Hrudayalaya's Raman was the question of putting in place an effective communication process about the ethos of quality care within an organization.
"Given the various applications that run in isolation, the challenge is to have a central infrastructure, and to have a real time information flow," said Raman.
It would be strange to find that, across the healthcare institutions, IT is not looked upon as a catalyst for growth. If an investment is proposed for some IT deployment, the management looks at opting for fresh medical equipment rather than IT.
IDC's Gupta found that CIOs in this industry vertical were burdened with increased overheads, the imperative to ensure quick turnaround time for treatments and constrained about going beyond the basics of IT.
Wockhardt's Suresh Shenoy felt that there was great pressure owing to the slowdown.
"Growth-related pressure is on two accounts, one is that the existing IT infrastructure needs to give a better RoI against major limitations and the second is the need to invest in additional IT systems. Balancing the two is difficult," maintained Shenoy.
The critical business challenge for Shenoy was to capture every small cost at the point of delivery given the complex cost structure with lots of shared services. Shenoy found that activity-based costing such as evaluating which product or service offering isn't easy to do.
While Dr. R S Tyagi did not see growth as a challenge with more funds coming into the fold, selecting a stable solution provider to work on consistent basis streamlining the entire IT infrastructure remained his biggest challenge.
HCG's Manish Gupta's key challenge is always whether the patient or the payer (insurance, government, or employer) is willing to spend for early detection, preventive care, and new technology.
Gupta's other challenge internally was to ensure quick turnaround time in the hospitals. From a technology point of view, he opined that most institutions found sourcing care protocols-based software, mobile phone-based care delivery and tele-health care etc. to be a tough task.
Despite the challenges and priority constraints, CIOs have managed to add the required IT services into their portfolio to drive demand.
IT in Vogue
Ricky Bedi CEO, Teleradtech
Bangalore's Teleradtech has seamlessly integrated radiology with IT to providing consultancy services to hospitals, diagnostic centers, customizing, deploying, maintaining and supporting the PACS (picture archiving and communication systems) and RIS (Research Information Systems) solutions.
Bedi has deployed medical information systems, health information systems and an in-house developed instant messaging system while ensuring that redundancy is built in.
"It was imperative to ensure that the technology improve the workflow within the organization," maintained Bedi. Bedi went in Smartris.Net, a Web-hosted RIS platform with integrated PACS and billing system on a unified database, supporting a RIS-driven workflow.
While facing the integration-related challenges with no standardized process, Bedi is focused on creating a platform with collaborative tools such as unified communication to integrated and enable the active use of EMR and Lab management systems by its clients. By deploying these applications, Bedi ensured that the productivity of radiologists improved, enabled single system access for patients, reduction in resource consumption and overheads for managing the workflow, besides easy maintenance and quick turnaround on implementation changes owing to the configurability of system.
While there have been few accounts of IT deployments at Narayana Hrudayalaya, Raman said that applications such as HIS and ERP were used to scale up operations. While retaining the IT team was a challenge, most of it had been developed in-house.
The biggest implementation had been with regard to HIS software sourced from a Mumbai-based company and Raman had deployed Tally as a backend for accounting purposes. The hospital's IT spend would be less than 1% of its total revenues this fiscal. It has tied up with 250 units as part of its telemedicine initiative to provide quick care to the patients.
According to Dr Tyagi, AIIMS planned to allocate Rs 20 crores towards IT for 2009-10. So far, the major expenditure had been on security, networking and infrastructure. The institution has an internal LAN that hooked up 1,500 odd systems within the campus and IT is used for basic e-mailing. For its other premises, it is connected through a 42 Mbps WAN from ERNET.
Dr Tyagi and his 20-member team's priority has been to computerize the hospital. The applications currently being used at AIIMS include library information, patient registration, diagnostic information, billing, accounting, publishing of literature and other departmental systems.
"We have been using security gateway solutions from Cyberoam as well as Microsoft and Novell operating systems," remarked Dr Tyagi.
AIIMS has been using telemedicine and more than 300 locations are connected to 500 experts.
The Oncology specialist, HCG's Manish Gupta, did not take IT spend on desktops, servers, security and applications, which were anyway mandatory, into consideration. "Our spend covers medical equipment interfaces, custom developed hospital system, disease treatment protocol software, video conferencing, tele-radiology, medical image archival, IP based alerts/alarm instruments, unified communications, and of course the "backend" financial/inventory systems."
Gupta maintains that part of building automation and mobile phone-based spend is also managed by IT and technologies related to embedded systems, RFID and nano-technology is generating interest in healthcare IT.
Gupta argues, the IT spend is highly variable, but a minimum of 1% of revenue is spent and a lot depends on the size of hospitals and interconnectivity needs that, in turn, depends on the level of interaction between physicians.
EMR has helped the doctors and the management effectively. A lot of spending has gone towards clinical research and trials and HCG has deployed business intelligence to capture accurate data for analytical reports. Gupta said that the key business were deploying software related to care protocols, mobile applications, tele-health including teleradiology, tele-diagnostics and tele-medicine.
"HIS is the basic need for all the healthcare has been developed in-house," said Gupta.
Given the economic slowdown, Wockhardt's Suresh Shenoy witnessed pressures on spending as every penny spent needed justification. 2008-09 saw spending towards telemedicine, PACS, RFID, CRM and integration of medical devices and equipment to deploy a central HIS at Wockhardt.
Shenoy and his team focused on deploying Wipro HIS ERP, developed on Microsoft SQL Server to cater to the complete business process at each hospital addressing various functionalities like delivery of care, labs, pharmacy, blood bank services, IP and OP billing, procurement, movement and consumption of materials. "There are about 30 modules, all of them tightly integrated online."
According to Shenoy, while HIS is locally installed at each hospital site, its financial summary in terms of payments, receivables, and GL is captured globally through Oracle Financial ERP as HIS is integrated with this to create a dashboard.
From an infrastructure point of view, Shenoy has gone for a high-end server with cluster management and fault tolerant WAN connectivity, connecting all of the hospitals over a MPLS VPN that is part of Wockhardt's global network.
The other areas of deployment at Wockhardt included centralized Internet access security enforcement, biometric physical access control and integration with the attendance system, while Lotus Notes messaging was in vogue. For each reach, Shenoy opted for digital wireless telephony at hospitals.
Shenoy saw the benefits of integrating disparate systems, medical equipment resulting in labor effort savings and increased accuracy and better delivery of care to customers.
2008-09 has been slow for most CIOs amidst stringent spending criteria, the current fiscal seems to be an exciting time.
IT Outlook
2009-10 could turn out to be a great deployment year for most CIOs in this sector. "Peer to peer collaboration is critical to address the demands effectively," said Bedi.
According to him, video conferencing, VoIP and the use of medical transcription were key to address business needs.
The key agenda that Raman would carry out would be to identify waste areas where costs could be trimmed using IT as a tool.
"My aspiration is to evolve a system where I can communicate to customers about our specialty offerings and services in an effective way with the use of IT," maintained Raman. "Since our growth plans are big, we would invest on IT, and the immediate need is to create a dashboard for providing real-time information using varied applications," he added.
Raman and his team are evaluating the possibility of outsourcing and deploying varied applications to suit their needs.
Dr Tyagi's agenda is to go in for a outsourcing model with a consultant suggesting varied applications and driving technological innovation at AIIMS.
"As we are getting ISO 21000 certification, it is mandatory to get the best security systems and applications which can increase our operational efficiency," remarked Dr Tyagi.
Gupta's thrust would be to deploy technologies that help the institution in the early detection of patient problems.
'I aspire to streamline operational processes in healthcare providers that are often ignored and unlike other industries, technology can build new business or customer base in hospitals," averred Gupta.
Gupta is keen to drive mobile technologies for his care providers (doctors, nurses, and I would even include patient's families) who are always short on time.
Mobile diagnostics is the focus area for HCG, besides Gupta aiming at building a model around imaging software integrated with SAP modules. "We would go in for varied modules from SAP and tweak it to our needs," said Gupta.
With some relaxation in IT spending during this fiscal, Wockhardt's Shenoy intends to align IT strategies with business strategies in a more efficient manner to make IT the major driver and a profit center.
While agreeing that IT penetration in the healthcare sector has been minimal restricting to basics, IDC's Arpan Gupta finds that the IT spend during 2008-09 had been to the tune of Rs 700 crores, which is likely to increase in this fiscal.
The popular solutions deployed include integrated billing systems, PACS, SOA to a certain and virtualization with a focus on telemedicine.
Cashing in on trends
As a technology trend, IDC's Gupta found that the evolution of subsidiary industries such as healthcare insurance, medical tourism, outsourcing and consulting services as the demand for healthcare is growing.
Besides this, from the IT infrastructure and applications point of view, Gupta found growth in networking, peripheral industry, software services and e-prescription applications and so on as the need for IT was growing amongst healthcare institutions.
Raman was keen on outsourcing and he expected health care insurance providers to drive the growth for IT as it involved effective communication.
Gupta expected that technologies related to teleradiology would be aspired for as there was a growing demand for this expertise, but there was a shortage of this community.
Dr Tyagi saw the deployment of storage and server consolidation on the rise with more data coming into the fold.
From a growth perspective, Wockhardt's Shenoy bet upon telemedicine, PACS, Integrations of Medical Equipment, ABCM (Activity based Cost Management) solutions which would be predominantly deployed across healthcare institutions.
With the Union Health Ministry mooting a proposal to set up a series of 'Medical Parks' all over the country to enable domestic health industry to manufacture health equipment at large scale, growth is assured. Besides, to encourage indigenous manufacturing, special economic zones have been initiated to make the industry competitive and regulate the market.
geetha.nandikotkur@expressindia.com
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