Business Times

Excess rooms in private hospitals

Out-patient service in the private healthcare sector is a rapidly growing segment in the country. According to the Health Master Plan, 2003, there were over 47 million out-patient visits, out of which the private sector serviced half of this, and the increases more than quadrupled showing a great scope for the healthcare sector ,according to analysts.

But they said that with more choices the competition is high and quality in the service offering will help firms in this sector stand out. A report by Bartleet Mallory Stockbrokerss aid that with increased spending patterns and exposure, the modern consumer is more demanding and thus will require customer friendly healthcare and higherquality services. “Hospitals will have to address these needs in order to compete.The increase in the services of the private hospitals, especially in Colombo,has led to increased choices for patients. The four main listed hospital giants enjoy a sizeable slice in the industry revenue depicting characteristics of anoligopoly. Excess demand was common across the industry during the last two to three years,” the report said.

High purchasing power, change in consumer preference, higher penetration of medical insurance were catalysts in creating overwhelming demand for private hospitals. According to industry experts, this resulted in private hospitals seeing closer to 100% occupancy during the last two to three years.
The healthcare sector in Sri Lanka consists of a strong government sector footing,with some 69,501 beds provided by state hospitals as at 2010. According to the 2008 annual report of the Central Bank the private sector contributed another 8,850 beds.

The number of private beds has seen a substantial increase over the years. Sri Lanka, with a 20.6 million population, has 3.2 beds per 1,000 persons according to the Central Bank’s annual report for 2010. “The World Health Organization (WHO) recommends a minimum of 1.9 hospital beds per 1,000 persons and according to the Health Master Plan, Sri Lanka provided around 0.2 inpatient admissions per capita in 2003, the report said. “This signifies a high demand forin-patient care in the country, the reasons being insufficient diagnostic capabilities in lower primary care and out-patient departments and admissions taking place on patient demand," the report noted.

According to the report, this Master Plan also states that patients bypass lower levelservices for larger city and provincial hospitals, leading to overcrowding. Private hospitals played a lesser role in in -patient care until the early1980s. However, the reintroduction of private practice of Government doctors, the liberalization of drug imports and deficiencies in state health services has resulted in rapid growth in the private sector.

But the report noted that during the past three to four years the healthcare industry attracted new investments and bulk of the investments stemmed from the existing players who wanted to consolidate their positions. “Such investments mainly occurred organically, for instance Asiri's investment in The Central Hospital in Norris Canal Road – Colombo and the Durdans Hospital's Sixth Lane Wing. Now the industry sees an excess supply (predominantly in the Colombo and surrounding city areas) which has resulted in declining occupancy rates to 60% - 70% levels,”the report noted.

Another growing trend that this report showed was that more and more players are expanding their reach to areas outside Colombo. “The Asiri Group already has its reach in Kandy and Matara and Nawaloka plans to expand to the suburbs. Being at a close proximity to a government hospital and purchasing power of the city dwellers are the key considerations in such expansions.Setting up a hospital in closer proximity to a government hospital helps a private hospital to attract government medical practitioners (for private practice) easily,” it pointed out.

Top to the page  |  E-mail  |  views[1]
SocialTwist Tell-a-Friend
 
Other Business Times Articles
Qatar seeks stakes in CSE, Kalpitiya and other property
Draft Tourism Act tilts balance of power, focus
Celestial Residencies compensation process gets underway
SLPA wants more in Colombo port project
CSE to lift country image for investments
New state company in renewable energy
50 years of banking
Youth unemployment crisis in Sri Lanka
Comment - ‘Lanka’s achcharu’ education policies
‘Mannar Divi Neguma’ to revive regional industries
Cinnamon Lakeside launches Colombo’s first floating leisure facility
Legal Process Outsourcing – Outlook and Opportunities
Eco bricks – rediscovering the old
British motor firm Range Rover sponsors top authors at GLF
Coca Cola conducts a two day workshop for English Teachers in Jaffna
Eurocenter changes name to ‘99X Technology’
‘America is the land of the free(dom)’, says Prof. Mendis
MTD Walkers involved in A32 road construction, piling work at top hotel site
HSBC Colombo Fashion Week enhances business of fashion in Sri Lanka
PCH prepares with confidence for 2012 year
Winning streak from Asia Asset Finance
Magic and One Trust Sri Lanka in outreach projects thro’ Galle Lit. Festival
Call for policy stability for stock market’s growth
Excess rooms in private hospitals
Access Engineering plans to go public in March
Sampath Bank to show a loan growth of 30%-35% in the next 2 years
LAUGFS smiles on leisure
RPC ventures into insurance
Exetel has won a major Australian telco contract
SL arbitration centre has 20 sittings per week
Ameresekere enrolled as an Associate Member, American Bar Association
Seychelles opens doors to massive Chinese tourist market
Expolanka using social media to reach out to stakeholders
Janashakthi says RAM Ratings reflect strong performance and healthy financials
Sri Lanka in world cooking contest (Bocuse d’Or) for the first time
SLT Broadband WWW speed now four times faster
Chevron celebrates decade of safety excellence

 

 
Reproduction of articles permitted when used without any alterations to contents and a link to the source page.
© Copyright 1996 - 2012 | Wijeya Newspapers Ltd.Colombo. Sri Lanka. All Rights Reserved | Site best viewed in IE ver 8.0 @ 1024 x 768 resolution