Why did this innovation happen in India and not the US or Europe?
Dr Shetty is planning to build a similar hospital in the Cayman Islands for Americans so I have to assume it has to do with government regulation. Is the health care system less socialized in India? I would guess it is.
If you lined up all the words contained in US law, the median word would be health care related, that has to matter for something. Also AMA enforced under supply of specialists. Also direct and indirect costs of health care liability. Also requiring hospitals to serve the ER without regard to ability to pay. Also low reimbursement rates for medicare, lower for medicaid. Also third party payment system that makes consumers price insensitive. Also huge overhead to third party payment system. Also enormously expensive FDA approval process recovered through drug costs. Also service business in a high wage country. Any others for the list? I don't mean to be totally negative, we get a lot of good things out of all that inefficiency, but it doesn't surprise me that quality can be higher and costs an order of magnitude lower under a different regulator regime.
Presumably protectionism is helping him a bit. I doubt that his surgeons are licensed to practice in the US, regardless of their expertise! It's nice to see the AMA driving progress.
Actually, wikipedia makes it sound as though it is more socialized in India, compared with the USA - http://en.wikipedia.org/wiki/Healthcare_in_India which makes sense given the historical British influence.
However, I think this sort of innovation was way more likely to occur in a developing country, regardless of if the individual or the tax payer is picking up the bill. It is a case of simple market forces as hinted in the article by:
On returning to India in 1989, Dr. Shetty performed the first neonatal heart surgery in the country on a 9-day-old baby. He also confronted the reality that almost none of the patients who came to him could pay the $2,400 cost of open-heart surgery.
"When I told patients the cost, they would disappear. They literally didn't even ask about lowering the price," he says.
Dr Shetty is planning to build a similar hospital in the Cayman Islands for Americans so I have to assume it has to do with government regulation. Is the health care system less socialized in India? I would guess it is.