By Sarah Arnquist

Walking through the government-run Gandhi Hospital in Hyderabad, India feels like stepping back 50 years in time. The nurses wear white dresses with those funny paper napkin hats. Exhausted people overflow the stuffy waiting rooms. Family members sleep and eat on the hallway floors while waiting for their sick loved ones, who lie on thin cots crammed together like sardines in the dim wards.

Before you get the impression that this scene depicts all health care in India, follow me to Rainbow Children’s Hospital or Apollo Health City located an hour away in the most affluent neighborhood of this city of 7 million. These corporate hospitals offer sparkling clean facilities, the latest technologies and even luxuries like flat-screen televisions in the super-deluxe patient rooms.

Apollo is the largest hospital corporation in Asia and a significant player in the international medical tourism industry. On a recent sweltering afternoon, Radhey Mohan, general manager of international patient services, gave me a tour of Apollo’s Hyderabad campus and told me about future plans to expand Apollo’s medical tourism business.

While these corporate hospitals offer state-of-the-art medical services
to foreigners seeking a bargain, such care is a dream for most
Indians.

Despite the media frenzy around medical tourism, I believe many Americans
envision health care in India exclusively like the scene at
Gandhi Hospital. I know my mom does. She fretted that I was going to
India without health insurance. She didn’t believe me when I told her
that if I had an accident or became ill, it would be a better deal to
pay cash for treatment here than fly back to the U.S.

The reality is that there is a gap the size of the Pacific Ocean in the
quality and availability of health services in India. Many villages
have no health care services, and at under-funded government hospitals
like Gandhi, equipment is archaic and the staff is overworked. There is no government safety net for the one-third of the population living on less than $1 per day. According to the World
Health Organization, India spent only 5 percent of GDP on health care in 2005, and 75
percent of that came from individual pockets. While it has made progress in the last 50 years, India ranks near the bottom on many public health indicators, such as infant and maternal mortality rates.

Yet, Middle Eastern
oil magnates come here to hospitals like Apollo to undergo Pet Scans and nuclear medicine tests. Apollo
nursing stations all have computers, and in a few years, Mohan told me
the entire hospital will be outfitted with an electronic medical
records system. Many of Apollo’s physicians have worked in the U.S.,
and following the recent trend of the reverse brain drain have returned
to India to develop thriving practices.

One of the first things many foreigners notice while traveling the
streets of Hyderabad is the incredible number of hospitals here. It
seems you can hardly go more than a block without seeing a sign
advertising hospital care. Typically, the facilities have fewer than 30
beds and focus on a particular specialty, such as maternity or heart
care. But given their volume, it’s difficult to imagine that just 25
years ago, India had no private hospitals. In fact, banks were
prohibited from financing corporate, for-profit health care.

In the early 1980s, Dr. Prathap Reddy returned to India from the U.S. with a vision to open a private hospital. Through an aggressive lobbying campaign, the founder of Apollo Hospitals convinced government officials that the public sector could not
meet the health care demands of India’s increasing population. Over the last two decades, Reddy built a monolithic brand that now operates more than 40 hospitals, hundreds of pharmacies, dental offices, nursing and hospital administration schools and more. Following Apollo’s lead, India’s private health care sector has exploded in the last decade.

Like most corporate hospitals here, Apollo has a mixed reputation. While I have heard no one dispute that the chain provides high quality care, I’ve heard many critical comments regarding its intensively corporate culture. Making money, many have said, is above all its chief concern. Treating the poor is a matter of "corporate social responsibility," and its services and prices, like those at most high-end hospitals, are far beyond the reach of most Indians.

Mohan and I talked a lot about the changing health care demands of Indian consumers in the growing middle class. As incomes rise, so do expectations. Middle-class consumers will no longer tolerate long waits and inadequate care at underfunded hospitals. They know about the latest technologies and demand them, Mohan said. “The consumer in the Indian market has changed,” he said.

At Apollo, 60 percent of patients don’t have insurance and pay cash for services. That’s an extraordinarily low percentage considering only 2 percent of India’s 1.2 billion people have health insurance. The insurance market, however, is also undergoing a revolution. Many of the nation’s major banks now offer insurance products. Apollo tied up with the German-based DKV Group to offer insurance. Certainly, more foreign health plans are eying the Indian market. United Healthcare recently teamed up with ICICI Bank to offer a health insurance product to Indians traveling to the U.S.

McKinsey released a report recently saying the current market for medical tourists is smaller than the media hype would lead people to believe. A previous report by the consultancy, however, estimated that more than 150,000 medical tourists visited India in 2002, and the number would grow 25 percent annually. Mohan told me Apollo has targeted it as a key growth area. Company wide the firm had more than 20,000 foreign patients last year.

At the Hyderabad campus, Apollo is building an entire new wing for international patients. The new building is across from the building that hosts the Apollo Health Highway, which is a tie-up with IBM to connect doctors across India to an EMR system using mobile devices, such as cell phones. It’s an interesting and ambitious project. On the second floor of that building, dozens of Apollo employees process medical billing claims for U.S. doctors.

Apollo has apartments on the hospital campus for family members of foreign patients to stay in and for the patients to recover in after the procedure. Patients can choose between super-deluxe private rooms or shared rooms, depending on their budget.  Before arriving, Apollo doctors review electronic copies of the patients’ CT scans and MRIs sent over the Internet and discuss the patient with their regular doctors at home. Once they arrive, hospital staff greet them at the airport and guide them through immigration to the hospital campus. Really, if they don’t want to “experience” India, they don’t have to.

In Indian hospital care, the past and the future co-exist. The lucky tourists and Indians who can afford to go to the corporate hospitals with new technologies and excellent medical staffs can be assured they will receive top-notch care. But far too many Indians have no care and inadequate care. Certainly, the private health sector expansion in the last two decades have benefited the country, but it hasn’t eliminated the embarrassing gap in quality and availability of health services. Some say the government must intervene, and whether and how it chooses to do so will be interesting to watch.