HCG’s Cancer Care Business Model
Healthcare Global’s (HCG) business model truly revolutionized India’s cancer treatment landscape. Before Dr. Ajaikumar started his venture, the prominent cancer centers in India were government-run and located in the main cities. The implications of government-run healthcare facilities in India can be framed with a low supply of care for the population’s high health demands. Socioeconomic status is also noteworthy; people of higher socioeconomic status have much better access and placements to these healthcare providers. Additionally, people that live in or close to larger geographic areas have more access to better cancer care. The typical family that lives outside these areas would have to travel to receive care in the larger metro areas.
HCG’s cancer care business analyzed using Frei’s business model for a service firm
In considering the service offering the service designers need to focus on the service experience they want the customers or patients to receive. In manufacturing, product designers focus on the physical characteristics of the products. In designing the service offering for HCG’s cancer care, they must make very focused decisions on what the business chooses not to do well. Somewhat counterintuitive, but this allows HCG to focus on providing excellence in certain areas and being inferior in others. HCG is focused on bringing high quality and innovative cancer treatment to patients in India that do not have access or means of access to this type of high-level cancer care. It is the first private for-profit cancer care center in the area. The service offering was designed as a hub and spoke model with the hubs providing more skilled and specialized services and the spokes in local communities providing a variety of routine cancer care treatments allowing many patients to receive care in their local community.
HCG has a policy not to turn any patients away due to the inability to pay for services. This is an example of its culture of commitment to providing high-quality cancer care to all socioeconomic classes. This decision comes at an expense, and without a plan to fund this “excellence,” it can be costly to the bottom line. Its vision of commitment to providing high-end cancer care drives HCG’s future decision making.
Providing service to all patients, even those who do not have the ability to pay adds value to the patients and services. HCG has a variety of ways in which it funds the mechanism via efficiencies and cost savings. To fund its ability to provide care for all patients regardless of ability to pay, HCG encourages employees to donate, and it holds a variety of fundraising events and dinners. Additionally, HCG enjoys cost savings in centralization and purchasing in scale. One decision that has led to cost-saving is being entirely vertically integrated. By owning its pharmacies, this allowed the company to buy directly from the manufacturer resulting in a lower cost.
Additionally, HCG generates increased revenue by opening pharmacies in other hospitals, charging a higher retail price to consumers. This also allowed HCG to control the quality of the drugs better while providing cost savings. HCG also leverages technology by allowing other hospitals outside of their geographic footprint to use its telemedicine services for a fee, thus increasing revenues.
According to the reading by Frei, the employee management system needs to set the employees up for success by giving them the motivation and ability to be successful. One way HCG’s employee management system provides the medical staff with the ability to achieve excellence is by leveraging technology. HCG is skilled at leveraging technology across its network, which improves efficiency and training for the MD at the spokes. Telemedicine provides Spoke Clinics with access to consultations with highly specialized hub doctors. Additionally, through centralization HCG leverages technology in a way to expand its hubs’ reach beyond its geographic area. Highly skilled physicists design complex treatment plans for patients and feed those treatment courses down to spoke hospitals. Spoke doctors also interact with hub doctors by providing the transmission of patient radiology images to its hub to produce the highest level of patient care in co-planning, evaluation, and treatment course.
The hub and spoke model and service design also benefit the consumer or patients greatly. The best system for managing its patients and customers is staying consistent with its business plan. Not only providing high-quality cancer care to underserved populations also the commitment to treating patients that are unable to pay for the services. The program, as a whole, is designed to be very patient-centric. A social worker was assigned to every patient. They assisted in a variety of tasks from financial counseling and planning to pay for services and advocated for the patients. Service excellence was at the heart of the consumer management system. Holistic treatments included in the programs, including dietitians and yoga. Even described the chemo center as “chemotherapy daycare” utilizing recliners and well-decorated areas to help soothe the patients.
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Hi there! I’m a Full Stack Developer and Project Manager with experience in delivering creative and effective solutions across healthcare, higher education, nonprofits, and other industries. I’m very passionate about transforming operations with technology and challenging standard practices. My strategy tends to focus is on people interactions, how we learn, perform, and communicate.