Setting up Affordable Healthcare Facilities under CSR – A need of the hour

Affordable Healthcare has largely been a prerogative of Governments, the world over. However, in India with Public Health spending stagnant for many years at 1.5 to 2.0% of GDP, there is a huge gap in providing affordable healthcare to the people. Healthcare that can be delivered only by Providers who do not expect Profits.

For a Private Hospital this is impossible. What will constantly rising costs, of equipment, medicines, consumables and manpower, it is very difficult for them make any substantial reduction in their charges, to make it really affordable to the lower and middle income group.

Also, with most of these hospitals built with help from Banks, Private Equity and other Investors, there is constant pressure on Private Healthcare Providers to service their debts and also deliver healthy returns to their investors.

Hence the urgent need for any other means to plug India's ever widening gap in affordable healthcare.

Using CSR Funds is one practical and readily available solution that has not been adequately tapped. There are Funds available with Profit-making Corporates to be spent as part of their Corporate Social Responsibility. Currently this amounts to between Rs 12,000 to 15,000 Crores, generated every year. Here lies a practical solution to bridging India's gap in Affordable Healthcare. Even if 50% of this amount is spent on building up healthcare infrastructure, atleast 20,000 beds can be added every year, for providing affordable healthcare. With some of India's leading Corporates being among those with the largest CSR Funds, we can expect their involvement in such projects to ensure the Hospitals are built of a very good quality, with the latest in equipment and facilities and be professionally managed too.

The need today is for Tertiary Care Hospitals to be set up in Rural and Semi-Urban Areas, including Tier 4, 5 & 6 Towns, places where Private Hospitals are reluctant to venture into, due to lack of a financial viability. For the Corporates spending in CSR, profitability of the venture is not a concern, only sustainability is. It should be enough for them if the Hospital Revenues are able to sustain the operations and expand the facilities over a period of time. They are definitely not looking for a return on their income. The Corporates will also have the clout to enable High-end Specialists to work in these Semi-urban and Rural areas, another major constraint in putting up the Tertiary Care Facilities in such areas.

So, what is preventing this from happening. Why do CSR funds not flow into building Healthcare Facilities. We guess it is the just the fear of the unknown. As the CSR Head at a prominent Steel Major remarked “We know how to make steel, but we don’t know how to run a Hospital”. They need professional agencies to work with them and help right from conceiving the right Hospital, identifying the best location to put it up in, i.e., where the healthcare services are most needed, identify the specific medical specialities and services to be provided and then going on to planning and designing the Hospital, along with putting in place a professional team to manage it.

The specific support Corporates will need to build up Healthcare Infrastructure are:

• Identifying the location to put up the Facility, where the need for healthcare is the most.
• Selecting Specialities and Services to be provided, with a Feasibility Study.
• Preparing a detailed Project Report, with the Cost of Project, Operational Expenses and Revenues.
• Managing the Project, from Designing and Construction to Commissioning.
• Equipment Planning and Procurement.
• Staff Planning and Recruitment.
• Operations Management.