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This is an archive article published on September 22, 2009

Low-cost care: Devi Shetty in race to run 2 hospitals in Delhi

Healthcare at one-fourth the price might be in Delhi soon as renowned cardiologist Dr Devi Shetty has been shortlisted as a bidder to run two hospitals in the Capital,in partnership with the state government.

Healthcare at one-fourth the price might be in Delhi soon as renowned cardiologist Dr Devi Shetty has been shortlisted as a bidder to run two hospitals in the Capital,in partnership with the state government.

The committee constituted by the state Health department and working on these public-private partnership (PPP) ventures,will submit the final list of selected candidates to the Health minister on Wednesday,informed sources said.

If Shetty wins the bid,sources said,he would put up another Narayana Hrudayalaya in Delhi — his specialty heart hospital in Bangalore.

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Among the 21 private players who had shown interest in the two hospitals,18 have been selected in the first list. The department will now send the ‘request for proposals’ to the shortlisted candidates,selected to partner the government to run the Janakpuri and Tahirpur super-specialty hospitals. These two hospitals were set up in September last year,but could not function fully since the government fumbled on the right model to run them.

Delhi government’s Principal Secretary (Health) J P Singh said: “The report will be submitted to the minister within a week. After that,we will invite the selected players to quote their terms.”

Dr Shetty is known for his ‘low cost-high patient’ care. Among his ventures with state governments,he found the Yeshasvini Micro Health Insurance — a joint venture between ISRO,Narayana Hrudayalaya and the Karnataka State Cooperation Department. In the first 20 months of Yeshasvini,85,000 farmers got free medical treatment,22,000 farmers had free surgeries,1,400 underwent heart surgeries — all for a premium of just Rs 5 per month. Under other schemes,Dr Shetty also provides free outpatient consultation,cashless surgical facilities and diagnostics at discounted rates.

At the Narayana Hrudayalaya,a heart surgery costs Rs 1,10,000 — much less than the prevailing market price. Only patients who can afford it pay for the procedure. Those who cannot,don’t pay.

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In 2008,only 1,232 heart surgeries were fully paid for at the Bangalore centre out of the 6,088 done. Yet,the hospital makes a tidy profit and has a turnover of Rs 300 crore — up from Rs 150 crore the previous year.

The Tahirpur hospital has a capacity of 650 beds,Health officials said; the one at Janakpuri has 300. Both hospitals will now be outsourced to private players.

The PPP model is likely to cost the exchequer over Rs 170 crore according to conservative estimates.

Government officials said the proposed allocation for upgrading the 300-bed super-specialty hospital in Janakpuri is Rs 70.26 crore; the 650-bed Rajiv Gandhi super-specialty hospital at Tahirpur would cost another Rs 99.7 crore.

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The state government has appointed Deloitte India as transaction advisor for the deal. The consultancy firm would frame rules and guidelines for the partnership process in the two hospitals.

Top 10 selected hospitals
* Fortis Hospital
* Metro Hospital
* Apollo Hospital
* Batra Hospital
* Narayana Hruduyalaya,Bangalore
* Sir Gangaram Hospital
* Wockhardt Hospital
* Max Healthcare
* Maharaja Agrasen Hospital
* Healthcare Global Services

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