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Outsourcing U.S. health care — twice

11 November 2008

This is an unusual idea — while people in the U.S. are used to Indian doctors, and some are getting used to the idea of going to Mexico for lower cost medical care, this is the first time I ever heard of combining the two.

From the Economic Times (India):

HYDERABAD: Indian hospital major Narayana Hrudayalaya plans to set up a health city in Mexico that will also cater to patients from the US.

“Our next project will be a health city in Mexico. We may tie up with some American hospitals for this project,” said Devi Shetty, eminent cardiologist and chairman of the Narayana Hrudayalaya group of hospitals.

Shetty was addressing a news conference here to announce the setting up of a health city – a multispecialty hospital with research facilities – in Hyderabad on the lines of the group’s famous facility in Bangalore.

“The health city in Mexico will be a 3,000 to 5,000-bed facility and we are looking for joint ventures,” he said adding that the government of Mexico had requested the group to set up a large health facility.

Sources said the health city would come up either in Mexico City, the capital of Mexico or at Guadalajara, the second largest city in Mexico.

Shetty said the proposed health city would also cater to the requirements of patients from America.

“We foresee healthcare delivery problems in the United States. They also have problems in undertaking a 20-hour journey to India for heart and other surgeries. As Mexico is closer to America, they will find it easy to undergo treatment there,” he said.

The chain of hospitals, which has already built one of the world’s biggest cardiac hospitals in Bangalore and is planning similar facilities in other cities, is reportedly in talks with the US-based Sutter Health for the Rs.10 billion health city project in Mexico.

The Rs.16 billion group, which currently has two hospitals in Bangalore and Kolkata, plans to invest Rs.50 billion over next five years in expanding its operations to six other Indian cities.

There are about 3.75 Rupees to the Peso, or 47.6 to the US Dollar… still, that’s a sizable investment.  These kinds of “off-shoring” from India make a lot of sense.  While the Indians do have a very good reputation for both engineering and medicine, Indian businesses face two problems:  transportation costs (patients from the United States are unlikely to fly half way around the planet, when they can fly a couple of hours to Mexico City or Guadalajara) and the educational system in India turns out stars and barely adequately educated people (at least in Engineering), which leaves a huge middle ground to be covered.  Indian software companies have started using Mexican programmers to meet midlevel demands, and I can see where Mexican doctors (whose training is at a par with other North American doctors for the most part) would easily meet the market demands for affordable heath care.  Even if the U.S. does finally catch up to what every other country did by the 1950s and implement a national health care system, it’s going to be several years before it comes on line… and, given the way the U.S. does things, it will still be a mixed system that leaves a demand for services like the proposed “health city.”

One Comment leave one →
  1. 11 November 2008 2:34 pm

    I did a piece about this back when I was a productive member of society. Even then, the Apollo Hospital Group was talking about opening facilities in Mexico for the same reason stated above – that it’s easier for Americans to get to than India. Of course, they get a lot more of their business from Europeans, so they must see a real demand if they’re starting to go through with Plan Mexico (so to speak…)

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