Apparently the idea is to import U.S.-style ideas about healthcare management to Asian nations. Sounds great, until you recall that U.S. healthcare is among the most wasteful in the world, with unnecessary and often dangerous overtreatment alone accounting for up to a third of all healthcare costs. If these are the sorts of ideas Columbia Asia, the firm's Malaysia-based unit, plans on exporting, then Indians had better brace themselves.
The Seattle Times story is long on context and short on detail as to exactly what Columbia Asia is doing, although it looks like the company is opening relatively small hospitals and extended-care facilities designed to appeal to a burgeoning upper and upper-middle class in fast-growing Asian nations:
Columbia Asia's operations began in 1994, when Chairman Rick Evans -- who previously worked for Baty -- opened an extended-care facility in Malaysia, then one of Southeast Asia's blossoming "Tiger Economies." The idea was to adapt business methods honed in U.S. health-care management to private hospitals serving the region's budding middle class.True to the path blazed by many U.S. hospital chains, Columbia Asia intends to cater primarily to well-heeled patients, particularly those who are opting out of public healthcare.
Now India, with its booming economy and giant population, is looking more like the land of opportunity.
"It took me one day of driving around Bangalore, India, to see the opportunity was unbelievable," Evans said. The southeastern city is India's Silicon Valley, housing Microsoft's research campus, among others. Middle-income households there were "underserved," he said.
Facilities are small: a typical hospital has about 65 adult beds, costing about $15 million to $16 million to build. It sees about 8,000 patients a month, and brings in about $1 million in monthly revenue, said Evans.Now, this may end up being a fine investment opportunity; pampering the wealthy is a tried-and-true business model. Still, depending on exactly what parts of the U.S. healthcare experience Columbia Asia transplants, it may well be selling its customers a bill of goods. If the last several decades of serious study has shown us anything, it's that beyond a certain point, spending more on healthcare doesn't make people better, and it often makes them worse.
The company's growth is in part driven by the expansion of private health insurance in Asia. About 70 percent of the company's revenues come from insurer payments, Evans said.
The equation might be different here if Columbia intended to expand medical access for the vast number of Asians who aren't rolling in newfound wealth -- but, of course, there's no money in that. So instead a certain class of Indians, Malaysians, etc., are most probably about to be introduced to the marvels of unnecessary medical imaging, prescription-drug overuse, unproven surgical procedures and the like. You have to wish the upper-crust patrons of Columbia's ritzy new facilities the best of luck, as they're likely to need it.
(Hat tip: Fierce Healthcare)