A Healthier Future For

India

Apollo Reachs Inclusive Business Model

Description
Apollo Reach is providing affordable, high quality medical care to individuals living outside of Indias major urban centers. Facilities offer similar type of care delivery of Apollos robust & telemedicine-enabled services. Expected to reduce patients overall cost by 20-30%. To make healthcare affordable to low-income patients, Apollo Reach participates in the governments national health insurance scheme for families living below the poverty line. IFC
$50 M loan

Apollo Hospitals Enterprise Limited

Drivers
Demand for low-cost, high-quality healthcare within easy reach Changing disease patterns resulting in need for specialized care Absence of quality hospitals providing specialized care Public health insurance creates market opportunity to serve poor patients

Established hospital facilities in smaller cities

Apollo Reach Hospitals

Emergency care, inpatient and outpatient services, telemedicine

Results to Date
Revenue per bed day at a Reach Hospital is Rs. 6,000 ($132) to Rs. 7,000 ($154) Plans to establish 50 Apollo Reach hospitals over time

Rural & semiurban consumers

2

Reach Hospitals Lower Cost model

Land costs are lower while setting up hospital projects in Tier II cities

Area per bed and overall hospital requirements are lower as the bed mix is lower & due to lesser car parking needs
Need to employ only functional medical equipment as there are no image constraints Doctors are relatively cheaper, 30% lower treatment costs coupled with 50% lower project cost Focussed on predominantly high end secondary care & cardiac surgeries Material costs are lower as complexity of surgeries performed is lower than in metros

Reach Hospitals Financing options for low income patients

In Karimnagar where we are empanelled under the State health insurance scheme, 50% of the patients belonging to the low income category were treated using the marginal cost approach We expect that with private health insurance companies penetrating in semi-urban & rural markets, these options would be available over a period of time

Apollo Reach- approach to low-income patient financing

Critical success factors Long term innovative financing instruments to be created for health care sector Health care delivery made available within easy reach. Treatment facilities & clinical outcomes on par with urban centres without compromising on quality Reduced overall patient costs Reduced time spent in travelling & accommodation during treatment period

Apollo Initiative to tap low income group

Aragonda model An Apollo initiative to tap the low income group which had a back to back insurance tie up, similar models have been adopted by state insurance schemes country wide.
Apollo was the first to use price discrimination to cross subsidize patients with limited ability to pay (with same level of care and treatment) and has extended this to the Reach Model.

Looking ahead: Future goals, challenges

Future Goals
Apart from greenfield opportunities, look at brownfield acquisitions/leasing options in smaller cities to expand the Reach network Achieve standardization across facilities and procedures to reduce variability and thereby enhance quality

Challenges : Refining the model continuously Rationalizing project costs further Getting the bed configuration right Getting the doctors engagement model right Getting approvals faster Deploying right mix of human resources

Achieving the target case mix as projected

Achieving the customer segmentation mix as planned : retail,insurance,institutional,govt. schemes Getting targeted returns over the stated period

Thank You