NTADBM - Group 3 project report

7/31/2019 NTADBM - Group 3 project report

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NEW TECHNOLOGY APPLICATIONS,

DESIGN & BUSINESS MODELS PROJECT:TELE-MEDICARE

PROJECT REPORT

SUBMITTED TO

Prof. Rakesh Basant, Deval Karthik, Bhavin Kothari &

Jignesh Khakhar

BY

Jay Prakash

Nikhil Sarode

Snehal Somkuwar

Snehshikha Gupta

DATE OF SUBMISSION: AUGUST 6, 2012


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CONTENTS

INTRODUCTION ............................................................................................................................ 3

What is Telemedicine? ............................................................................................................... 3

Types of telemedicine ................................................................................................................ 3

Applications of telemedicine ...................................................................................................... 4

Technological evolution of telemedicine .................................................................................... 5

Current status of medical care in India ....................................................................................... 5

Telemedicine in India ................................................................................................................ 6

Gaps and opportunities .............................................................................................................. 7

BUSINESS MODEL ......................................................................................................................... 8

Product and services .................................................................................................................. 8

Target segment .......................................................................................................................... 8

Value proposition ...................................................................................................................... 8

Market size .............................................................................................................................. 10

Pricing ..................................................................................................................................... 10

BUSINESS DESIGN REQUIREMENTS ........................................................................................ 10

Application interfaces .............................................................................................................. 10

Application workflow .............................................................................................................. 12

CUSTOM DEVICE ARCHITECTURE ........................................................................................... 13

BOOTSTRAPPING THE BUSINESS ............................................................................................. 13

REVENUE PROJECTIONS ............................................................................................................ 13

REFERENCES................................................................................................................................ 16


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INTRODUCTION

WHAT IS TELEMEDICINE?

The World Health Organisation defines telemedicine as The delivery of healthcare services,

where distance is a critical factor, by all healthcare professionals using information and

communication technologies for the exchange of valid information for diagnosis, treatment

and prevention of disease and injuries, research and evaluation, and for continuing education

of healthcare providers, all in of advancing the health of individuals and their communities.

Thus telemedicine helps to eliminate distance barriers and provide medical services that are

not consistently available to people rural areas or distant areas. With remarkable development

in telecommunication and information technologies, it has become possible to enable

communication between patients and medical care providers as well as transfer medical

images, records, outputs from medical devices, sound between distant locations.

TYPES OF TELEMEDICINE

Telemedicine can be broken down into three types

Store - and -forward: The medical data is captured and transmitted to the medical staff at a

later point of time so that it can be assessed offline. Medical fields like dermatology,

radiology are typically ideal for implementing such asynchronous telemedicine.

Remote monitoring: It enables medical professionals to monitor a patient remotely using

technological devices. It can be used typically with heart diseases, diabetes, asthma etc.

Interactive services: It enables real time interaction between patients and medical staff using

phones or online communication. Activities like history review, psychiatric evaluations,

ophthalmology assessments etc can be carried out using this type of telemedicine.


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APPLICATIONS OF TELEMEDICINE

Telemedicine can be used in a variety of medical applications

FIGURE 1 APPLICATIONS OF TELE MEDICINE

Second opinions: In complex cases, the treating doctor at the remote site can interact with a

team of specialists in another location for accurate diagnosis through use of telemedicine. Thepatient can himself/herself also take second opinions through use of telemedicine.

Disease and disaster management: In case of natural disasters like earthquakes, where

medical facilities cannot be quickly set up, telemedicine can be used to provide medical help

in a timely manner

Remote consultation: Telemedicine enables providing consultation in remote areas where

full-blown medical facilities are not set up. In rural areas where medical institutions and

practitioners do not find it profitable to set up medical facilities, telemedicine can play a big

role. Only consultation is provided and if necessary, specialist recommendations are made.

Continuous Medical Education: Telemedicine can be used to spread awareness related to

health and medicine.

Telementored procedures: Specialist can guide surgeons at remote site in carrying out

complex procedures.


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TECHNOLOGICAL EVOLUTION OF TELEMEDICINE

FIGURE 2 EVOLUTION OF TELEMEDICINE

Generation 1: Early efforts of telemedicine can be traced to 1920s when audio and cable

television technologies were used for consultation. At that time, radios were used to link the

physicians on the shore stations to assist ships in the sea for medical emergencies. ECG

transmission over telephone lines to record cardiac activities was also achieved during this

period.

Generation 2: NASAs efforts in telemedicine began in 1970s when paramedics in remote

Alaskan and Candian towns were linked to town or city hospitals via satellites

Generation 3: Use of digital compression and transmission technologies using T1 or ISDN

lines allowed for point to point interactive videoconferencing and transmission of o heart rate,

respiratory, circulatory and other physiology related information.

CURRENT STATUS OF MEDICAL CARE IN INDIA

Indias population is growing at a tremendous rate and its healthcare infrastructure is unable

to meet the growing demands. When compared to other developed and developing countries,

India spends significantly low (less than half the global average in terms of percent of GDP)

on healthcare. India has an average 0.6 doctors per 1000 population against the global


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average of 1.23 suggesting an evident manpower deficiency. Furthermore, rural doctors to

population ratio is lower by 6 times as compared to urban areas. Most of the doctors are

concentrated in urban areas. Around 74% of graduate doctors work in urban areas that

constitutes only about a quarter of Indias population. With current number of medical

colleges in India and the number of doctors graduating from them each year, we need 600

more such colleges to attain the global average doctor to population ratio. The geographically

the distribution of these colleges is also skewed, 61% of them being present in only six states.

This adds to the disparity between healthcare facilities available in different regions of the

country.

TELEMEDICINE IN INDIA

Major support for telemedicine in India is provided by the Department of Information

Technology through ISRO and medical institutions like AIIMS. In private sector, Apollo

Hospitals, Fortis etc are also in play in telemedicine.

ISROs telemedicine pilot p roject was started in the

year 2001 with the aim of introducing the telemedicine

facility to the grass root level population as a part of

proof of concept technology demonstration. The

telemedicine facility connects the remote District

Hospitals/Health Centres with Super Specialty

Hospitals in cities, through the INSAT Satellites for

providing expert consultation to the needy and

underserved population. Presently ISRO connects

around 306 rural/remote hospitals to 60 super specialist

hospitals. Apart from connecting the health centres toSuper speciality hospitals for teleconsultation,

treatment and training of doctors, ISRO has set up connectivity for Mobile Telemedicine

units for rural health camps especially in the areas of ophthalmology and community health.

FIGURE 3 ISRO TELEMEDICINE

NETWORK IN INDIA


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While the satellites facilitate

transfer of data between the

patient-end and the doctor-end,

there are other equipments like

VSAT (transmitting and receiving

station), video conferencing

camera, TV monitor, Computer,

Hub/Switch required at both the

ends to facilitate the

communication.

Cost of set up at the Patient End

FIGURE 5 COST OF SET UP AT THE PATIENT END

As seen from figure 5, a major chunk of setting up a patient end is accounted by the VSAT.

Even though the costs of VSAT have been decreasing, it is still about INR 1.2 lakhs.

In private sector also, hospitals like Apollo have employed similar technologies to enable

telemedicine.

GAPS AND OPPORTUNITIES

The technologies currently employed for enabling telemedicine in India is largely based on

satellite as seen previously. Even though the cost of equipment has been decreasing over the

FIGURE 4 SATCOM TECHNOLOGY USED BY ISRO


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years, it still requires funds in excess of Rs. 4 lakhs to setup the patient end. With innovations

in tablet devices and telecommunication infrastructure (3G), it is possible to provide

telemedicine service at a low cost. Low cost setup and operations would facilitate a quick

scaling up of the telemedicine services to reach a wider mass.

BUSINESS MODEL

PRODUCT AND SERVICES

The aim is to provide a cost effective way for teleconsultation. We will provide a platform

between doctors and patients who are seeking medical consultation remotely. It would help

the patients to avail consultation at cheaper cost and doctors to earn more income. Theplatform would also help doctors keep better track of patient histories. The patients would

have access to a wider pool of doctors to consult and receive quality medical services from

doctors. The platform will also help patients to get medicine delivered through medical

shops. We would also provide the integrated mobile device to people who would be

interested in providing medical consultancy services to people. They would earn money by

revenue sharing in fees earned from medical consultation to patients.

TARGET SEGMENT

The target segment among doctors would mostly be general physicians and less of

specialists. The assumption is that most of medication consultations that can be provided

remotely will need general physician, few consultations that will require specialists will be

critical in nature, and in such cases the doctors will need the patient to be physically present

for the treatment. The target segment among patients would those are suffering from simple

ailments and can be treated remotely. These patients would need access to a mobile device,laptop with internet access or custom device to use the services. The target segment for

custom devices would be rural shopkeepers or small businesspersons. They would be trained

to use the device. As health is one of the key concerns of the government, they might use

white label platform to improve health services delivery.

VALUE PROPOSITION

The value proposition for the various set of users is as follows:


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DOCTORS:

More revenues: The application would allow doctors to reach potentially reach a larger set of

patients using the platform who can communicate in the language understood by the doctor.

The increase in potential market size would allow them to earn better revenues.

Better accessibility to patients: Doctors will need access to mobile device and internet

connectivity to be able to treat patients.

Better accessibility to medical history for patients resulting in improvement in treatment

quality: The platform would store the medical conditions and treatments provided to the

patients. This information would be shown to the doctor next time the patient is being treated.

Less setup cost for new doctors: The doctors could start their practise on this platform

without buying any office space or setting up infrastructure.

PATIENTS:

Quick access to medical consultation: The patients who are suffering from minor ailments or

who can be treated remotely can get medical consultation from mobile devices or custom

devices nearby without having to visit the doctor. The service will also be used in

emergencies to provide first aid consultation.

Better medical services: The platform provides access to all the doctors present on the

platform potentially and therefore provides better access than traditional method. This means

that patients have an option to choose doctors for them and would be able to receive better

services. The platform also provides their medical history to the doctors that aid doctors in

diagnosis and treatment.

Time and cost savings: As patients do not visit the doctor physically, they are able to save

time and money. At times patients have to wait in queues to meet the doctor and this can be

avoided on the platform.

Additional services: Patients can also get home delivery of their medicines by contacting

medicine stores.

CUSTOM DEVICE OPERATORS

They would get monetary benefits by revenue sharing.


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MARKET SIZE

The market size can be estimated using target segments. The total number of doctors in India

is around 600,000 with the percentage of general physicians around 40%. Therefore, the

market segment is around 240,000. The market size of patients includes rural population

without hospital and a part of urban population. Only 44% of the Indian villages have access

to visiting doctors and about 20% of the villages do not have access to any hospital.

Therefore, about 25%-30% of the Indian population is the market size among patients

including only rural patients. Adoption among urban population would be adversely affected

by the loyalty of u rban patients to their doctors. Patients loyalty depends on commitment,

trust and satisfaction. Trust and satisfaction are affected by doctors reputation. Therefore, the

adoption of the platform would be faster if reputed doctors are associated.

PRICING

Doctors decide their consultancy fees depending on their reputation, knowledge, experience

and customers ability to pay etc. Therefore, doctors will fix their charges for consultancy

individually. They would have the ability to charge different at different times but would be

applicable for all customers. For example, the charges levied by doctors during odd hours

may be higher than during normal work hours. The main source of revenue would be part of

fees earned through consultation by the doctors. The doctors would be willing to pay the part

of fees, as the service will ensure that they will be paid as opposed to the case where people

can directly call on phone but may not pay. The pricing would percentage of the fees earned

with a minimum fee that would be charged in case percentage of fees earned is too low to

compensate for the costs involved in providing service. Typically the variable costs would be

charges of the network, cost of providing infrastructure. The fixed costs would be cost of

custom device provided in rural areas, marketing costs etc. The charges fixed by doctors

would be for per 10 minutes. This is based on the assumption that the doctors generally do

not spend more than 10 minutes on one patient in majority of the cases. The charges paid by

the doctor would either of minimum fixed fee Rs. 10 or 20% of the total fees charged.

BUSINESS DESIGN REQUIREMENTS

APPLICATION INTERFACES


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PATIENTS:

Login or register: The patients will have to login into the application before using it.

Therefore, new patients will have to register before using the application. Their

registration form would require their basic details such as name, age, gender, contactinformation, language preference etc. The registration for rural patients would be

done with the help of device operator if necessary. The patient will get a unique ID

and password after registration. The mobile device will keep track of registrations

done to make it easier to login later. The login screen will display the list of IDs

created on the mobile or would require entering ID and password. The password

would be saved on the device that was used for creating the ID, in case the password

is lost. Another alternative to login and password would be to use biometric identitylike fingerprints to identify a user. But its success would depend on the accuracy with

which the biometric device and software is able to identify the user.

Consult a doctor: The patient on login would see a page to consult a doctor. This page

would allow the patient to choose from the list of doctors already consulted and who

are available or choose a new doctor. The page for choosing a new doctor would

allow the patient to choose a fee range, range of location for choosing doctors etc.

After choosing these details, the patient would be shown a list of doctors available for

consultation. The patients can then have a video chat for medical consultation with

one of the doctors after payment. The patients can also choose doctors from the list of

previously contacted doctors which would be arranged in chronological order and are

available for consultation.

Payment for consultation: A patient would have to pay before they can consult a

doctor. An urban user would be able to pay online. Rural patients would have to pay

the money to the device operator for consultation.

Medication summary page: This page would be shown after the medication

consultation ends with the doctor. This page would show the medicines and diagnosis

details.

DOCTORS:

Register and login: The doctors would need to register and verified before they can

provide medical consultation to patients. For registration, doctors would need to fll

details of their education background, experience, languages spoken, contact etc. The


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doctors would be charged for verification fee for the verification process. After

registration, doctors would be provided login and password for the the application.

Patient Consultation: The doctor would get a notification asking them to accept a

request for consultation. Once accepted, the doctors would be able to see the video

and patient details. During the call, doctors would be able to take notes for diagnosis.

At the end of the call, the doctor would give the prescription for the patient.

Settings page: The doctors would have a settings page where they would be able to

change their consultation fees and schedule. The schedule can be shown to the

patients if they want to consult a particular doctor so that they can plan their call

accordingly.

Earnings page: This page would allow doctor to see their past earnings, current

earnings and methods of receiving their payment.

APPLICATION WORKFLOW

Medical consultation workflow: When the patient searches for a new doctor for

consultation, the application would look up for matching doctors for the patient whoare in the nearby locations and within fee range provided by the patient. Within the

matching list of doctors, the application can select based on ranking of the doctors.

This would be helpful in maintaining the quality of the platform. Once the patient

chooses a doctor, the doctor would be notified to accept the consultation call. Once

the doctor accepts the call, the video of the call would be recorded for security and

legal purposes. If the doctor does not accept the call, the user will be able to choose

another doctor. For providing the better experience, the application would track the

doctors not accepting the calls and this would be included in deciding the ranking of

the doctors.

Doctor verification workflow: When new doctors register on the platform, a

verification process is needed to establish of the credibility of the doctor. The doctor

would have to provide the details of their educational and professional qualifications.

A notification for pending verification will be sent to support personnels. The

notification would be carried out using background verification services. If the


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verification is successful, the doctor would be notified and allowed to provide

services on the platform.

CUSTOM DEVICE ARCHITECTURE

The custom device for rural patients would consist of basic tablet with 3G connectivity and

webcam. It would have the patient application interface and would support some basic

application to such as heart beat measurement, body temperature etc.

BOOTSTRAPPING THE BUSINESS

As with any two-sided platform, this platform would face challenges initially in attracting

doctors and patients. This would require incentivizing one side of users, so that they join the

platform and the other side of users will join due to cross network effect. To attract doctors to

the platform, the doctors would be waived off the educational and professional verification

fees initially. Doctors would also get referrals benefits such as reduced platform fees. Patients

would not be attracted unless doctors are available on the platform. To mitigate the loyalty of

patients towards doctors, the application would need to attract doctors who would be able to

win the trust of the patients and to provide satisfactory services.

REVENUE PROJECTIONS

Cost of centre: The fixed cost of the centre would be the custom device and the

peripheral devices such thermometer etc. The variable costs of the centre would be 3Gdata connection costs. The 3G data connection cost have been calculated using the

current rates, however the 3G rates would go down further due to price wars between

various service providers. The calculation for the data usage using 3G has been shown

in the Figure 6. It assumes that data usage besides video calls would not be

significant.


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Bandwidth requirement for video call(KB/sec) 50Total bandwith use per call assuming 10 min call(MBs) 29Monthly data use (GBs) 1.2Current average 3G tariff rates (per GB) 250Yearly data charge (in Rs.) 3000

Data usage summary

FIGURE 6: DATA USAGE SUMMARY

To account for extra data usage at the centre, the yearly data charge has been fixed at

Rs. 5,000. The fee earned by the device operator has been assumed to be 5% of the

fees received by the doctors. The summary of cost per centre is given in Figure 7.

Device 10000peripheral devices 1000

3G connection 5000Device operator commission 5%

Cost per center(in Rs.)

Fixed

Variable

FIGURE 7: COST PER CENTRE

Cost of application: The fixed cost of application would be the cost involved in

developing the software and device. The variable costs would be costs of the supportstaff and data server costs. The summaries of costs are given in Figure 8.

Software development 1000000

Support staff 500000data server 100000

Cost of application(in Rs.)Fixed

Variable

FIGURE 8: COST OF APPLICATION

Revenue Projections: Revenue projects are based on following assumptions:

o Number of urban patients visits in the first year will be 20,000 and will grow

at the rate of 50% for the first five years.

o Fee charged on doctors revenue would be 20% of their revenue.

o Average number of rural patients per centre would be 500.o The number of rural centres is 1000 in first year and would increase at the rate

of 50% in first five years.


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o Average consultation fees of doctors would be Rs. 50 and would grow at the

rate of 20%.

o Tax rate is 35% and opportunity cost of capital is 10%.

Year 2012 2013 2014 2015 2016 2017

Number of rural centers 1000 1500 2250 3375 5063Rural patients visits 500000 750000 1125000 1687500 2531250Urban users of mobileapplication 10000 15000 22500 33750 50625Urban patients visits 20000 30000 45000 67500 101250

Average consultation feeof doctors 50 60 72 86 104Total Revenues (in Rs.) 5200000 9360000 16848000 30326400 54587520

Costs of centerFixed 11000000Variable 6250000 7500000 9000000 10800000 12960000Cost of applicationFixed 1000000Variable 600000 720000 864000 1036800 1244160

Depreciation 2400000 2400000 2400000 2400000 2400000SG&A 6850000 8220000 9864000 11836800 14204160

Profit before tax -4050000 -1260000 4584000 16089600 37983360Tax -1417500 -441000 1604400 5631360 13294176Profit after tax 0 -2632500 -819000 2979600 10458240 24689184

Add depreciation 0 2400000 2400000 2400000 2400000 2400000Free cash flow -12000000 -232500 1581000 5379600 12858240 27089184NPV 18739624

FIGURE 9: NPV CALCULATIONS


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Health infrastructure in rural India, B. Laveesh & D. Siddhartha, Retrieved on August 6,

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Human Resources for Health, Retrieved on August 6, 2012 from http://uhc-

india.org/reports/hleg_report_chapter_4.pdf

Indian Telemedicine Program: Marching Toward TransformingNational Healthcare Delivery System, R. Murthy & L. Satyamurthy, Retrieved on August 6 ,

2012 from

http://www2.telemed.no/ttec2007/presentations/session08_tuesday/s08_tue_1315_Abdul_OK

.ppt

Patient Satisfaction, Trust, Commitment and Loyalty toward Doctors , S. Norazah & S.

Norbayah, Retrieved on August 6, 2012 from http://www.ipedr.com/vol10/94-S10058.pdf

Telemedicine, ISRO, Retrieved on August 6, 2012 from

http://www.isro.org/scripts/telemedicine.aspx

Telemedicine in India - current opportunities and barrier, K. Varun, Retrieved on August 6,

2012 from

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NTADBM - Group 3 project report