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Business models for innovative health care - comparison of examples #2 Nyaya and #3 Smile Train

Business Model #2 - Nyaya Health of Nepal

In the previous post I laid out a canvas view of the Heart Institute of the Caribbean health care model. I will use this post for the comparison of other models mentioned in the MIT article found here:

http://globalhealth.mit.edu/home/business-models-in-global-health/c...

The second model is that of the Nyaya medical services in Nepal. This initiative is to deliver health services effectively to a remote, geographically and economically challenged area of Nepal. this business model is structured more along the lines of a multi-sided platform. The Nyaya organization leverages the Nepalese government investments in a hospital and training of health care workers to deliver free health care to the remote community.

Key elements of the BM:

one side of the platform the value proposition is the delivery of free health care to a poor community in a remote geographic area.
the other side of the platform the value proposition is piloting the delivery and approach for the Nepal government, operating the government owned hospital facility, gathering and disseminating open data on health care in rural areas
there is no revenue stream from the recipients of health care, and government funding only covers a portion of the operating costs, so the initiative is very dependant on donations and grants.
they rely on word-of-mouth and partner NGOs to direct patients to the program, and overall direction and planning is guided by an international Board of Directors liked through IT channels
Since a large part of their vp is the open source data gathered and provided, the internet structure of wikis, websites and blogs are key to delivery of that vp. Their key client channel is the outreach through NGOs
their key activities are not solely around delivery of health care. They are very concerned with pharmaceuticals supply chain (32% of costs) development, and their data collection and dissemination is very valuable.
Key resources are the gov't owned hospital and a 5 year agreement to operate, and the data they are collecting on rural health care. Their limited resources have to be augmented by volunteers

As always, comments, correction and suggestions welcome.

Tags: Nyaya, examples, healthcare

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Permalink Reply by Sujit Kotnur on July 12, 2011 at 12:46pm

Dear Mike,

I liked your BM, i would like to add that we need to bring in more value to the revenue streams than merely being dependant on Government funding, a few thoughts i have are:

1. Open up the patient base to ethical Clinical trials - Phase IV, the set up since mostly managed by NGO's transparency can be maintained.

2. Through KP's, include the telecom operators to provide the reach since they benefit through voice and data services.

3. I think having in house Pharmacy would help, with direct participation / pooling of medicines from large Pharmaceutical companies.

4. Same is the case with Diagnostics too - the medical devices manufacturers would be more than interested / should be convinced on pay per use model. However they can contribute towards the leasing by an upfront amount to the HC initiative - Nyaya.

5. Lastly there exists a Large amount of patient data which can be made as Anonymized Patient level structured data and a whole lot of FMCG / F&B industry would be interested in possessing. Since its Anonymized its safe and secure.

Trust this helps.

Best regards

Sujit Kotnur

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Permalink Reply by Mike Lachapelle on July 13, 2011 at 4:01pm

Business Model #3 - Smile Train of India

This is the 3rd of the business models on innovative health care initiatives covered in the MIT article on business models in global health. The details can be found here: http://globalhealth.mit.edu/home/smiletrain/

This is an extremely interesting model when compared to the first two - Heart Institute of the Caribbean (separate post) and Nyaya of Nepal (above). The Smile Train initiative is not a deliverer of health care, but is more a funding organization, driving and supporting the delivery of health care. They are running two separate business lines to accomplish this.

The first business, like the Nyaya is about delivery health to communities through local infrastructure. They differ from Nyaya in two ways. First, they are focussed in one specific medical area (cleft and palate) and are not providing general care. The second, they are funding the local delivery system, rather than using the infrastructure to deliver the service as Nyaya does.

The second business is fund raising. Unlike Nyaya, who also rely heavily on donations, Smile Train is approaching this as a philanthropic organization and focus to document social impact, minimize operational costs and focus activities on funds and awareness raising.

Key Elements of the BM:

1 - Health Services

fund not deliver services
no revenue stream from patients or local hospitals (covered by donations)
use of electronic records and communication channels
leverage local facilities and talent - accredit and train local resources
community outreach to engage and acquire patients, NGOs and own teams
face a challenge in delivery where no infrastructure already exists

We have recently had many discussions about the role of social impact as a 'captured value' in business models. This is a great example of this dimension at play. The success of the donations program is predicated on proving the effectiveness (as well as the efficiency) of the program delivery. Therefore the documentation and statistics related to the program delivery business line is a vital captured value that becomes a resource inside the fund raising business line.

2 - Fund raising

here (unlike Nyaya) fund raising is a business line with a value proposition for donors, key activities, costs and partners
in other circumstances I would break out the two business models, and provide more detail about the channels and donor engagement and retention. This information was not available in the article and deck.