Technology holds immense potential to improve healthcare affordability

Dr Nitish Shetty, CEO, Aster DM Healthcare, India in an interaction with Kalyani Sharma shares his company’s current and future plans and discusses about the role of technology and PPPs in the healthcare sector

What are the current plans of Aster DM Healthcare, and what would you be looking for this year?

The segregation is expected to unlock value for investors in India and we do have some aggressive plans in pipeline to fuel this excitement. We do have some aggressive plans to expand in India in the next 3 years. Currently, we have 19 hospitals spread across 5 states, with most of them in South India. Although this includes nearly 4500 beds across our hospitals, we believe there is room for further growth. Following the segregation, we now represent about 1/3rd of the entity in India.

Compared to our peers, we are on par in terms of size in India, but the market demands a larger share. Our aim is to rank among the top 3 healthcare service providers in India, and we now have the opportunity to achieve this goal. Therefore, we have devised a clear expansion plan for the next 3 years, focusing on organic growth. We plan to add over 1700 beds by FY27, a combination of brownfield and greenfield opportunities to take the total number of beds in India to 6600+.

Our greenfield expansion is slated for Kerala, with projects in Trivandrum and North Kerala. However, a significant portion, 60 per cent of our investment, will go towards expanding existing capacity, primarily in Kerala and Karnataka, with a few additions in other states. This expansion is in anticipation of the market growth expected in the next 2-3 years, aligning our capacity with projected demand.

Expanding northward not only enhances our margins but also allows for substantial investment in hospital equipment, boosting our competitiveness and visibility in the market. Additionally, we are exploring expansion opportunities in other geographies, notably Maharashtra.

Are you targeting tier 2 & 3 cities for these opportunities?

Yes, we are. Our model has been proven successful in tier 1 & 2 cities, with 70 per cent of our units currently located there, including business in tier 1 cities like Bengaluru. While we’ve performed well in these areas, we are open to opportunities in other metro cities.

Our primary focus, however, remains on expanding and increasing our footprint, replicating successful models established in Bengaluru and Kerala.

Our mandate is to ensure consistent footprint growth while meeting stakeholder expectations in terms of margins and performance parameters. The evolving healthcare landscape demands a blend of consolidation and expansion efforts, a balance we aim to achieve moving forward.

How do you see technology impacting healthcare affordability?

Technology holds immense potential to improve healthcare affordability. The complexity of healthcare operations, with diverse specialties and data fragmentation challenges, can be effectively addressed through AI integration. While digitalisation and telemedicine have made strides, they have not fully addressed data fragmentation. AI, however, shows promise in this regard.

Technology adoption, particularly in business aspects, is gaining momentum, driven by benefits such as streamlined data access for clinicians, enhanced patient-doctor interactions, and improved operational efficiency. Integrating technology with insurance systems can lead to seamless processes and improved healthcare outcomes.

Do you foresee challenges in healthcare professionals adopting AI?

While there may be initial hesitancy, healthcare professionals are increasingly embracing technology for its potential to enhance efficiency and augment their capabilities. AI, seen as “Augmented Intelligence,” complements rather than replaces human expertise. As technology matures to offer tangible benefits like streamlined patient data access and improved diagnosis processes, adoption among professionals is likely to grow.

The convergence of clinical expertise and technological advancements will drive widespread adoption, empowering healthcare professionals to deliver better care.

What are Aster DM Healthcare’s future plans regarding innovation and technology?

We prioritise collaboration with technology firms for innovation and R&D initiatives. Collaborations in both clinical and business domains aim to leverage technology for improved healthcare delivery and operational efficiency. Technology plays a crucial role in achieving our goal of being among the top healthcare providers, driving innovation and enhancing patient care experiences.

How do you view Public Private Partnerships (PPPs) in healthcare?

PPPs have been beneficial in leveraging government-sponsored schemes and expanding healthcare access. While challenges exist, particularly in payment and pricing structures, collaborations between private and public sectors can drive positive outcomes in healthcare delivery. The government’s role as a facilitator and regulator, with private sectors as providers and payers, can lead to improved healthcare access and quality.

What do you see as the biggest challenge and opportunity for the healthcare industry?

The biggest opportunity lies in India’s growing healthcare needs, with significant potential for expansion and innovation. However, deploying talent and infrastructure to tier 2 & 3 cities poses a challenge, albeit one that can be overcome through coordinated efforts among stakeholders. The integration of private insurance, improved connectivity, and government support are key factors in realising the industry’s potential and providing equitable healthcare access across the country.

Aster DMdigital healthPPPs in healthcaretechnology
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