Few startups are going beyond basic services like booking appointments to providing comprehensive medical assistance from diagnosis to treatment, helping patients with finding the best and most affordable options for any treatment.
One would assume that the mushrooming of healthcare startups in such a short span of time would begin to make a dent in the Indian healthcare industry plagued by logistics, supply, and delivery issues. However, healthcare tech startups are facing many internal and external challenges, themselves.
Infrastructure and market challenges
The external challenges come from the inadequacies of the Indian healthcare system, such as infrastructural limitations, skewed resources, and outdated practices. One of the most glaring problems is the low ratio of doctors to patients in India – 1:1,700 – which is lower than the prescribed ratio of 1:1000 by WHO.
The internal challenges are the same as any other tech startup faces – dwindling valuation and lack of funding. While the lack of funding is an issue for many startups, for others, an excess of funding is as big a problem. The problem with excessive funding is that a large amount of it goes unchecked and isn’t channeled appropriately. Due to a lack of viable revenue models and monetisation opportunities for services, startups are unable to break even and end up constantly burning precious money without any tangible results.
If we really think of the true potential that the healthcare tech sector has in developing the Indian healthcare system, we would find that the current crop of startups has barely scratched the surface.
Most ventures in the space are simply e-commerce platforms selling medicines and basic healthcare services online, some with discounted prices. However, the success of e-commerce is based on an entirely different premise. E-commerce involves the aggregation of multiple sellers on a common platform to provide customers a wide range of products at the cheapest available prices, including discounted branded products.
So, healthcare as a product or service cannot be distributed through the e-commerce model, because no one would take risks with their health or that of loved ones by purchasing cheaper, generic drugs. Hence, the e-commerce model is not compatible with the healthcare sector. Instead, newer, more innovative models must be discovered that can help develop the healthcare tech startup environment in the best possible manner.
A strong value proposition, supported by innovations in product and technology, can assist healthcare startups in attracting investors and funding. The service offerings for startups need to go beyond just aggregation, appointment-booking, or medicine delivery functions. Rather, startups should focus on more advanced applications of the vast technical and technological expertise at their disposal.
The internet of medical things
The ‘Internet of Medical Things’ is one such area that can help connect doctors and specialists in urban areas and metros to primary health centres and patients in rural centres and tier II and III cities through cloud computing. By moving their focus to functions like providing preventive healthcare services, low-priced medical devices, lifesaving drugs, equipment, and data analytics, healthcare startups can create a highly evolved and competent digital healthcare delivery system.
Hospitals, healthcare firms, and insurance companies can exchange anonymous patient data, which will aid analytics-based decision-making, and medical research on prevalent diseases in India such as diabetes and heart disease, instead of relying on data from western sources.
A tech-enabled ecosystem
It is the onus of primary stakeholders in the healthcare industry such as doctors and hospitals to cooperate with entrepreneurs to aid startups in developing a tech-enabled ecosystem of healthcare delivery. Private sector healthcare firms can establish development programmes to fund and mentor young entrepreneurs. Venture capitalist and private equity firms should identify entrepreneurs and startups with the most innovative propositions and high growth potential and mentor them to build their business. Healthcare startups must also look for alternative methods of funding such as crowdfunding and venture debt to finance their business.
India can benefit greatly by studying examples of countries like Japan, the U.S., the U.K., and Chile that have realised the immense significance of healthcare and developed their health infrastructure accordingly. Through well-developed programmes, policies and initiatives, these countries have built a strong healthcare delivery mechanism with the help of innovation in technology that has impacted the overall growth of these nations.
On this note, the healthcare tech industry is marching ahead with the vision to lead the healthcare domain, but the challenges remain, not just in the technology-integration aspect, but also in terms of the systematic re-organisation of healthcare infrastructure in India.
(Opinion piece by Ravi Virmani, Co-Founder and Managing Director, CrediHealth)
Source: e27