Lawton Burns' New Book on Health Care in India

Lawton Burns' New Book on Health Care in India

And Why That County Hasn't Become the Medical Tourism Center It Hoped To Be

Over the last decade, health care entrepreneurs in India funded and built several "health cities" of medical facilities they predicted would lure a rich stream of "medical tourists" from the U.S. and other countries. But that effort has turned out to be more "myth than reality," according to a new book by Wharton School professor and LDI Senior Fellow Lawton Burns.

The 600-page, $118 tome entitled "India's Healthcare Industry: Innovation in Delivery, Financing, and Manufacturing" was produced by a 16-member team of experts headed by Burns who was also the project's editor. It's designed as a business primer on the
Lawton Burns
Lawton Burns, PhD, MBA, is an LDI Senior Fellow and a Wharton School professor of health care management.

Asian nation's overall systems of providers, payers and medical product producers.

The University of Pennsylvania professor who is Director of the Wharton School's Center for Health Management & Economics has also served since 2010 as the Program Leader of Healthcare Management at the Indian School of Business in Mohali, India.

In a Knowledge@Wharton video interview, Burns said that while the India's aspirations to be a global medical tourism center have been widely publicized around the world, "those expectations were way overblown."

Quality issues
He said the ability of India's emerging private health care industry to attract American medical tourists has been thwarted by several barriers. Among those are the fact that neither Medicare nor private U.S. insurance companies cover medical procedures in India. Another is that medical quality itself is a "frontier" for India because the country does not comprehensively regulate its health care industry.

As a result of these difficulties, one of the entrepreneurs who organized the first Indian "health city" for medical tourism is now building a similar center in the Cayman Islands where his company hopes it
Lawton Burns book
The new book, "India's Healthcare Industry: Innovation in Delivery, Financing, and Manufacturing," details the current state of Indian health care.

will be easier to draw Americans seeking a mix of cheaper surgical services and tropical-island ambiance.

Indian health costs
Burns pointed out similarities between Indian and U.S. health care -- one being how the rise of of private hospital chains throughout India is paralleled by a continuing rise in overall health care costs.

One big difference is that 60% of India's rising costs go to pay for pharmaceuticals (by comparison, prescription drugs account for less than 20% of U.S. healthcare costs).

At the same time India has a high demand for drugs, it also has very little in the way of an organized retail pharmacy sector -- chains like Walgreens or Rite Aid, he said. The bulk of drugs are sold by local mom-and-pop businesses.

This opportunity has drawn the attention of a number of Burns' current Penn MBA students, Burns said. They plan to go to India after they graduate to set up retail pharmacy chains.