Dr. Devi Prasad Shetty bags The Economic Times Award for Corporate Excellence

Dr. Devi Prasad Shetty bags The Economic Times Award for Corporate Excellence

Mangalore Today News Network

Mangalore, Sept. 19, 2012: Dr. Devi Prasad Shetty, a cardiac surgeon based in Mangalore, has won The Economic Times Award for Corporate Excellence 2012, conferred in recognition of the recipient’s ability to enter the big league and take on the best in the world.

Dr. Devi Prasad Shetty is the founder of Narayana Hrudayalaya and its pioneering model of low-cost, high-volume healthcare. Shetty, who plans to add 30,000 beds to his chain of hospitals in India and abroad, has also collaborated with the Karnataka government to design the world’s cheapest health insurance scheme, which currently covers over four million people in the state.

A distinguished jury comprising of Deepak Parekh, KV Kamath, Kumar Mangalam Birla, AM Naik, Kris Gopalakrishnan, Chanda Kochhar and Cyril Shroff has selected the winners of The Economic Times Awards for Corporate Excellence 2012. The other winners of these awards are Anil Agarwal, Anshu Jain, Sam Pitroda, PRS Oberoi, HDFC Bank, Jubilant Foodworks, and Aditya Birla Group.

The model of providing quality medical care at an affordable cost to the largest number of patients that was pioneered by the 59-year-old cardiac surgeon is now being replicated across a chain of hospitals in India and overseas. In the coming year, six new hospitals across India will offer the low-cost, high-volume model followed at Narayana Hrudayalaya, the multi specialty hospital chain in Bangalore, which he founded in 2001. And in the next seven years, the hospital chain expects to have 30,000 beds across India, Africa, and Asia. Next month, Shetty and his team will launch the first of a series of low-cost heart hospitals in Mysore.

“Charity is not scalable. If you give something free, you will run out of money,” says Shetty, who is convinced that building a large-scale business is the only way to provide quality healthcare to the masses.

“Twelve per cent of all heart surgeries conducted in India is done at Narayana Hrudayalaya. So vendors supply materials to us at a lower cost as they can address a tenth of the market,” he says. His business model also includes a cap on doctors’ salaries, full-service fees for rich patients and philanthropic capital that helps the organization generate profits, which can be ploughed back into the business.

By drawing on examples of large corporations such as Walmart that also gain from economies of scale, Shetty has now crafted a health city. At the first campus, Narayana Health City, on the outskirts of Bangalore, patients have access to cardiac care, neurosurgery, paediatric surgery, haematology, transplant services and nephrology. A state-of-the-art trauma hospital Sparsh and an ophthalmology hospital Narayana Nethralaya are also a part of the complex, which is expected to house a children’s hospital and a cancer research centre.

Earlier this year, Narayana Hrudayalaya formed a joint venture with a hospital chain in the US to build the Cayman Health City in the Cayman Islands. It will serve over 40 million residents of the Caribbean region. Apart from internal accruals, the company is also using debt and equity capital raised from AIG and JP Morgan in addition to promoters’ equity to expand its footprint.

Born in the erstwhile South Canara district of Karnataka, Shetty graduated in general surgery from Kasturba Medical College, Mangalore. He trained in cardiac surgery at Guys Hospital in the United Kingdom. After returning to India in 1989, he worked at the BM Birla Hospital in Kolkata and was Mother Teresa’s physician during the last five years of her life. He then moved to Bangalore and started the Manipal Heart Foundation at the Manipal Hospital, Bangalore. “Entrepreneurship happened by chance as I did not find an employer who understood me,” says Shetty, who believes a certain degree of eccentricity is what drives him.

“Doctors at the pinnacle of their careers work 16-18 hours a day at our hospital. I can manage such eccentric people as I count myself as one amongst them. I understand them,” observes Shetty, who has performed over 15,000 heart surgeries.

In Karnataka, Shetty has also crafted a unique, low-cost insurance programme, Yeshasvini, estimated to be the world’s cheapest comprehensive health insurance scheme. Launched in tandem with the state government, it covers 4 million people who pay a premium of Rs 10 per month. “There is no point in an innovation or a magic pill that is not affordable,” says Shetty, who is melding the charitable ideals of his role models Mother Teresa and Mahatma Gandhi with hard-headed business sense.