Jan. 27 (Bloomberg) -- In April, Ian Stuart Crombie,
64, couldn't finish his round of golf at the Bonny
Island course in Rivers State, Nigeria, because of pain
in his right hip. Doctors gave him two choices: live on
painkillers or undergo surgery.
Crombie opted for a route that more Europeans and
Americans are taking. He looked beyond a decrepit
airport and teeming streets and chose India for medical
In September, the British citizen flew 5,159 miles
(8,303 kilometers) from his home in Winchester to Apollo
Hospital in Chennai. Doctors performed a hip
resurfacing, which involved shaving his thighbone and
fitting it with a metal head that was then anchored in
his hip socket.
With the operation, Crombie joined the international
clientele flocking to India for cut-rate services that
include telephone call centers, software design and
``Indian hospitals are a very cheap option where
patients get the same quality they're used to back
home,'' says Sanjay Dongre, who manages the equivalent
of $237 million of shares at UTI Asset Management Co. in
Mumbai, which owns Apollo stock.
Investors hoping to benefit from the influx of
foreigners are driving up shares of Chennai-based Apollo
Hospitals Enterprise Ltd. Apollo, which runs 33
hospitals in India, including the one in Chennai, is the
country's only publicly traded hospital chain.
On Jan. 25, Apollo traded at 243.6 rupees on the
Mumbai Stock Exchange after rising 39 percent in 2004,
triple the 12 percent gain for the benchmark Sensitive
Index. Maxwell (Mauritius) Pte, a unit of Temasek
Holdings Pte, the Singaporean government's investment
company, bought a 5 percent stake in Apollo for $11.2
million in September.
For Crombie, who was working as a human resources
manager in Africa, Apollo presented a low-cost option.
He says his medical plan didn't cover the hip operation.
He didn't bother with the U.K. National Health Service
because of its waiting list and decided not to pursue
treatment in Nigeria. A private hospital back home would
charge 15,000 pounds ($27,965), he says.
Instead, Crombie paid a total of 5,000 pounds for his
India trip, including the operation, airfare and a stay
at the $130-a-night Park Hotel in Chennai.
100 Billion Rupees
Health care for foreign patients like Crombie will
deliver 100 billion rupees ($2.3 billion) a year to
Indian hospitals by 2012, according to a report by New
York-based consulting firm McKinsey & Co. and the
New Delhi-based Confederation of Indian Industry, the
nation's biggest business group. The market in 2003 was
$333 million according to the Gurgaon-based India Brand
Equity Foundation, a partnership between the CII and
India's Ministry of Commerce.
Heart surgeons such as Naresh Trehan, 58, who
practiced at the New York University School of Medicine
before starting a hospital in India, are moving the
nation beyond the medical services it already sells to
Wipro Healthcare IT Ltd. in Bangalore produces three-
dimensional images from radiology scans for
Massachusetts General Hospital in Boston. SRL Ranbaxy
Ltd., a Mumbai-based laboratory certified by the
Northfield, Illinois-based College of American
Pathologists, tests blood, other body fluids and tissue
samples for hospitals in Abu Dhabi and Dubai.
Hurdles to India's medical ambitions abound. With
100,000 patients a year traveling to the country -- up
from 10,000 five years ago -- hospitals are struggling
to remedy first impressions that can turn people off.
Howard Staab, 53, a self-employed carpenter from
Durham, North Carolina, chose India for surgery to
repair a leaking mitral valve, a condition that can
cause heart failure. Staab had toured Spain and New
Zealand and spent 10 months at the South Pole building
science research stations.
Even so, he says, he and companion Maggi Grace, 51,
were startled in September 2004 by streets overflowing
with people and bicycles and by neighborhoods where new
offices butt up against tarpaulin-covered slums. They
wondered whether the price of his operation -- $6,700
with Trehan at New Delhi-based Escorts Heart Institute
and Research Centre compared with $200,000 at Durham
Regional Hospital in the U.S. -- was worth the risk.
``For a minute I thought, `What have I done?'''
recalls Staab, who says he's happy with his surgery and
care at Escorts.
Harpal Singh, chairman of Fortis Healthcare Ltd., a
privately held New Delhi company with three specialty
hospitals in northern India, says the medical industry
is banding together to improve its image.
The Indian Healthcare Federation, a group of about 60
hospitals, is developing accreditation standards. In the
U.S., organizations such as the Joint Commission on
Accreditation of Healthcare Organizations, based in
Oakbrook Terrace, Illinois, assess infection rates, the
width of hospital corridors and the capacity of
In India, there's no accreditation, and hospitals
aren't required to provide information on the outcomes
of treatments. ``There is nothing as far as quality
standards go,'' says Vishal Bali, 36, vice president of
operations at Wockhardt Hospitals Ltd., which is owned
by founders of Indian drugmaker Wockhardt Ltd.
``Hospitals keep data, but they don't need to share
Escorts' Web site lists only the number of procedures
it has performed. Trehan, Escorts' founder and executive
director, says the hospital had a mortality rate of 0.8
percent and an infection rate of 0.3 percent in 2003.
That compares with an observed mortality rate, or the
rate of actual deaths, of 4.77 percent for heart valve
surgery or coronary artery bypass surgery that included
heart valves at New York-Presbyterian Hospital from 2000
to 2002, according to a New York State Department of
India competes for foreign patients with Malaysia,
Singapore and Thailand and offers less in some areas,
says Guy Ellena, director of the health and education
department at Washington-based International Finance
Corp., the private lending unit of the World Bank.
Starbucks in Lobby
He says Thailand's airports and roads are in better
shape than India's because Thailand is a major vacation
destination. In 2003, 10 million tourists traveled
there, according to the Tourism Authority of Thailand's
Web site. That was more than triple the number for India
Bumrungrad Hospital Pcl, which runs Bumrungrad
Hospital in Bangkok, started courting overseas patients
during the Asian economic crisis in 1997 as the
devaluation of the baht drove down costs for visitors.
That year, Bumrungrad treated 50,000 foreigners, says
Curtis Schroeder, the hospital's CEO. It handled seven
times as many in 2004, accounting for 35 percent of its
patients, he says.
Last year, Bumrungrad hosted 150 Indian delegations,
including one led by Wockhardt's Bali, showing them
intensive care units, recovery rooms and the Starbucks
cafe in the lobby.
``The focus on international patients screams at
you,'' Bali says. ``They have interpreters and
instructions in multiple languages: Arabic, Bengali and
Spanish. What it shows is that convenience offsets most
other things for an international patient.''
Indian hospitals are countering with perks of their
own. Escorts representatives met Staab and Grace at New
Delhi's Indira Gandhi International Airport, helped them
through immigration and drove them to the hospital in a
Toyota van. Their room was stocked with fruit and
``They had a car waiting and all these people
helping,'' Grace says. ``I felt like Princess Di.''
After surgery, Escorts loaned Staab and Grace a mobile
phone so they could stay in touch once they left the
Foreign patients are still far from the norm.
Operations on non-Indians accounted for 10 percent of
the more than 4,000 surgeries at Escorts in 2003. Vijay
Bose, who operated on Crombie, has performed about 300
hip resurfacings in India since 2000 -- 30 of them on
``The care from Dr. Bose and his team, right down to
the nurses, was very good,'' Crombie says.
Foreign surgeries will pick up as rising health costs
and long waiting lists provide incentives to travel to
India and its low-priced rivals, Trehan predicts.
In the U.S., health-related spending climbed 7.6
percent to $1.68 trillion in 2003, consuming almost 15.3
percent of the $11 trillion gross domestic product. It
was the fifth consecutive year that the cost of medical
care expanded faster than the economy, the
Baltimore-based Centers for Medicare and Medicaid
Services said this month.
U.S. employer-paid health insurance premiums have
soared 59 percent since 2000, according to the Henry J.
Kaiser Family Foundation and the Health Research and
Educational Trust, nonprofit groups that study medical
care. In 2004, premiums averaged $9,950 for families and
$3,695 for individuals, the groups found.
In the U.K., the waiting list for the
government-funded National Health Service prompts some
patients to look elsewhere. Last year, the lag averaged
less than nine months for surgery, about half the 18
months in 1997.
Unlike Crombie, who chose India after deciding not to
pursue an operation through the National Health Service,
Ian Brown, 57, discovered India by accident. In July,
Brown, a director at Harrogate, England-based
electronics company Surevision Ltd., suffered chest pain
and went to his local doctor.
The National Health Service told him he'd have to
wait as long as four months for a test and then, if
required, two years for an angioplasty to open blocked
arteries, he says.
On vacation in India in September, Brown experienced
chest pain again and was rushed to Wockhardt Hospital in
Bangalore. Wockhardt performed an angioplasty the next
day, inserting a wire mesh tube called a stent to prop
open an artery.
``The hospital could have been in London,'' Brown
recalls. ``It was immaculately clean and had good
standards.'' Back in England, Brown says, he got a
letter from the National Health Service in November
asking him to come in for his initial test -- two months
after he'd had the surgery in India.
Not everyone is enthusiastic about India's push to
become a health care destination.
``I'm not sure Indian hospitals should start focusing
and investing huge amounts of money on treating overseas
patients,'' IFC's Ellena says. ``They should first, or
in parallel, meet the needs of the country.''
In India, insurance plans cover 14 percent of the
more than 1 billion people, leaving almost 900 million
without protection, according to the McKinsey-CII
report. As many as 350 million people live on less than
$1 a day, according to the World Bank.
India spends 5.2 percent of its $580 billion GDP on
health care and still lags behind Thailand, Brazil and
South Korea in life expectancy. People live 61 years on
average in India, less than 68.9 years for a developing
country such as Brazil and 77.3 years for a developed
country like the U.S., according to the World Health
Organization. India has 91 infant deaths per 1,000
births compared with 38 deaths for Brazil and eight for
$800 vs. $18
Charging foreigners more than Indians is one way
hospitals can make money to treat the poor, says Gautam
Kumra, a McKinsey & Co. partner in New Delhi. An
echocardiogram machine, used to picture the heart, costs
about $200,000 anywhere in the world. Doctors can charge
$800 per scan in the U.S.; in India, they charge 800
rupees, or $18, Trehan says.
The difference makes it tough to recoup costs. ``Why
are hospitals so excited about overseas patients?''
Kumra asks, pointing out that there are more than enough
Indians to fill the nation's hospitals. ``It's not that
they can't get volumes in India. What they can't get is
pricing. They should charge for the value.''
Fortis Healthcare plans to do just that. The company
is setting up two hospitals on the outskirts of New
Delhi. One will cater to overseas patients and charge
them higher prices, says Harpal Singh, who adds the
hospitals haven't set fees yet. Fortis is owned by
brothers Malvinder and Shivinder Singh, who control
India's largest drug company, Ranbaxy Laboratories Ltd.
Harpal Singh is Malvinder Singh's father-in-law.
One imbalance that works in India's favor is its
lower salaries. A top cardiac surgeon in India makes
about $330,000 a year compared with $5 million in the
U.S., says Anupam Sibal, director at Apollo Hospital New
Cheaper pay and lower hospital fees make India hard
to beat for health care costs, Trehan says. ``For
countries with problems with their health care systems
-- whether quality, cost, quantity -- India can fill the
gap,'' he says.
Foreign patients started traveling to India in rising
numbers five years ago, as word of hospitals such as
Apollo and Escorts spread among the 20 million people of
Indian origin who live outside the country. Others tried
India because they felt comfortable with Indian doctors,
Wockhardt's Bali says.
Angioplasty, Knee Replacement
Some Middle Eastern patients began choosing India
after the Sept. 11, 2001, attacks on New York and
Washington, says Suneeta Reddy, 45, director of finance
at Apollo Hospitals and daughter of founder and
Executive Chairman Prathap Reddy, 71.
In November, Waleed Khalid Al-Zadjali, 40, a doctor
in Oman, picked Apollo for his father's angioplasty and
his mother's knee replacement. Oman hospitals often
refer patients to India for complicated procedures
because the country is familiar, closer than the U.S. or
Europe and cheap, he says. ``After 9/11, people were
scared to go to the U.S.,'' he says.
Indian doctors are returning, too. Bose learned hip
resurfacing at the University of Birmingham in the U.K.
in the mid-1990s. He moved back to India in 2000 and is
one of the first doctors to offer the procedure in his
Trehan, who was educated in India, began his medical
practice in the U.S. He got his bachelor's degree in
medicine and surgery from King George's Medical College
in Lucknow in northern India. After graduation in 1969,
he left for the New York University School of Medicine.
He finished his residency in 1977 and stayed on as part
of the faculty and to perform heart surgery. In 1982, he
began thinking about opening a heart institute in India.
`I used to get a lot of Indian patients in New York,
and they asked me, `Why don't you do this in India?'''
he says. He sent a proposal to six Indian business
groups. The New Delhi-based Nanda family, which owns
farm and construction equipment maker Escorts Ltd.,
helped with an initial investment of 170 million rupees
in cash and loans, Trehan says.
Trehan opened the heart hospital in 1988; today, it
performs more than 4,000 operations a year. Trehan has
trained 40 surgeons and serves as president of the
International Society of Minimally Invasive
Cardiothoracic Surgery, a Beverly, Massachusetts-based
group with a thousand members worldwide.
Escorts' white, six-story building with its
green-tile parapets stands out on the corner of an
intersection where shoppers dodge bicycle rickshaws and
People jam the lobby, which has white-marble floors
and black-granite counters. Seventeen patients are
listed for operations on a December morning. In one
operating room, doctors crowd around a man who has been
in surgery for more than four hours. In another darkened
theater, a surgeon sits four feet from the operating
table. He bends over a console to view a
three-dimensional image of the heart, working two
joysticks that control robotic arms.
Trehan says the machine lets surgeons make small
cuts, reducing infection rates and recovery time.
``Heart surgery was not even known in this part of the
world when I started,'' he says.
Trehan, in light-blue surgeon's clothes, sits at a
desk cluttered with papers. Five computer monitors on a
shelf behind him display patients' vital signs. A
lifetime achievement plaque from the Geriatric Society
of India lies on a coffee table. Surgeons line up to ask
advice, charts in hand. He barks orders, and they turn
around, stooping their shoulders as they go.
Having accomplished what he set out to do with
Escorts, Trehan is planning a multispecialty hospital in
Gurgaon, on the outskirts of New Delhi, that's patterned
on the Cleveland Clinic in Ohio and the Mayo Clinic in
He wants to meld western medicine with homeopathy and
the practice of ayurveda, a holistic approach that
balances a person's physical and emotional states. He
expects the hospital to be ready in 2007 at a cost of
$250 million. He says he's wrapping up funding and
declined to provide more details.
Staab, the North Carolinian, says Trehan's early work
in the U.S. convinced him to choose Escorts. Even so, it
wasn't an easy decision. Staab's initial thought when he
heard about India was that calls to his local phone
company were answered there. Apart from that, he and
Grace liked Indian food. ``We kept trying to build
confidence in our decision,'' Grace says.
They looked into a package deal for about $40,000,
including surgery, fees and the hospital stay, at the
McAllen, Texas-based McAllen Medical Center. They
Grace's son, Brian Maxwell, 23, a second-year student
at Stanford University School of Medicine in Stanford,
California, proposed India, where he'd spent eight weeks
working in hospitals. His professor, Sakti Srivastava,
director of anatomy and surgery applications,
Staab was rolled into Escorts' operating room on
Sept. 28. Grace, who'd picked up a smattering of Hindi,
wrote ``dhanyavaad,'' for ``thank you,'' on his bare
chest with purple marker.
The surgeons first decided to repair Staab's mitral
valve. A day later, the valve walls thickened and
obstructed blood flow. Staab went in for a second
operation on Sept. 30, and doctors replaced the valve.
He was ready to leave on Oct. 8 when blurry vision from
suspected blood clots kept him for another two days to
thin his blood. Staab and Grace returned to the U.S. on
Grace says finding out about India was the tough
part. If not for Srivastava, she and Staab never would
have figured out where to look, let alone gather the
courage to make the trip.
``I was worried I couldn't get clean or I would have
to eat something rotten,'' Grace says. ``There has to be
more done to get someone to India in comfort. You can't
just get up and go.'' She says better access to
information about India and its hospitals would have
Crombie was familiar with India, where his job had
taken him to recruit workers in Cochin, Mumbai and New
Delhi. He found Bose on the Internet and checked his
credentials with doctors Bose had worked with in the
U.K. He decided on India after e-mail exchanges
persuaded him that hip resurfacing rather than hip
replacement would give him a better shot at playing golf
``I can imagine someone who's not been to India
before may find it intimidating,'' Crombie says.
Indian hospitals are working to make the transition
easier. Trehan wants to build a hospital in the Bahamas
staffed by Indian doctors so travel would be shorter and
the surroundings more familiar for U.S. patients. So
far, there are no backers, he says. Apollo is setting up
a London clinic to attract people seeking alternatives
to the National Health Service.
``A doctor would look at them, find the problem and
make all arrangements to get them to India,'' Suneeta
Back in North Carolina, Staab had an opportunity to
compare health care in the U.S. with his treatment in
India. An early November checkup found that his blood
was still too thick, and he entered Durham Regional
Grace says she had to ask for sheets to make Staab's
bed and get him water herself. The bathroom wasn't
cleaned, and they had to ask twice for the intravenous
bag containing blood-thinning heparin to be changed when
it became empty, she says. Carol Clayton, senior public
relations specialist at Durham Regional, says the
hospital addresses patient concerns as soon as they are
brought to the staff's attention.
Do It Again
``The care at Escorts was exceptional,'' Staab says.
``I would do it again.''
Crombie echoes Staab's assessment. He says his
colleagues were skeptical about India. Now, they're
asking about Bose and the hospital.
Just as Indian software companies started with small
programming jobs and expanded to become a $16 billion
global industry, India's international health care
initiative is in its early stages. For patients and
profits to increase, India must remedy negative first
impressions and persuade doubters that millions of the
country's poor and ailing won't be left behind.
To contact the reporters on this story:
Abhay Singh in New Delhi at email@example.com and Mrinalini Datta in New Delhi at firstname.lastname@example.org
To contact the editor responsible for this story:
Ronald Henkoff email@example.com