Outsourcing

India's Factory Model for Hospitals

Mother Teresa's cardiac surgeon, Dr. Devi Shetty, keeps a photo of her on his desk that says "Hands that serve are more sacred than lips that pray." Shetty has kept that in mind, offering heart surgeries to those who couldn't afford them, but he's doing it with a business model that would make Henry Ford proud. The doctor has transformed Indian health care by opening huge hospitals (1,000 beds, compared to 160 on average in the U.S.) that offer procedures at sharply reduced prices. At his flagship hospital, an open-heart surgery costs about $2,000, while in the U.S., the surgery would cost between $20,000 and $100,000. And counterintuitively, the quality of care has increased, in part because doctors get more practice and specialize in just one or two types of surgery. Shetty plans to open four more "health cities" around India, and one in the Cayman Islands. More than 6 million Americans are expected to go overseas for affordable health care next year.