A third economic pillar

It is anticipated that soaring health costs in the US coupled with a
reform in US healthcare policy will drive an increasing number of
Americans to look outside the US for healthcare. The Cayman Islands,
just an hour or so flight away from Miami, is perfectly poised
geographically to embrace the concept of medical tourism. World renowned
cardiologist Dr. Devi Shetty’s proposed Narayana Cayman University
Medical Center is set to assist the Islands in developing medical
tourism as a crucial third leg to its beleaguered economy. Business
Editor Lindsey Turnbull reports.

 
Dr. Devi Shetty has set his
sights firmly on the Cayman Islands as his next destination for the
creation of a high quality medical facility, which charges considerably
less than its counterpart US hospitals.
 
Last month an agreement
was signed between the Cayman Islands government and the Narayana Cayman
University Medical Center, which paved the way for a phased in approach
to an eventually 2,000 bed hospital.
 
Premier McKeeva Bush
hailed the agreement as the beginning of new opportunities for the
Islands to broaden its economic base and create a sustainable revenue
source.
 
The business model – economies of scale.
At
the agreement signing Shetty said that basing the development of such a
centre on the American system did not make sense, because the US has the
most expensive healthcare system in the world. Instead, Shetty said his
Centre will look at ways to reduce costs via the sourcing of
pharmaceuticals and medical appliances outside the US, as well as
increasing the volume of procedures carried out to far greater levels
than that of counterpart.
 
US hospitals.
“For example,
antibiotics from Canada are half of US prices,” he stated. “The quality
is just the same but at a much cheaper cost. The price of procedures in
the US is also unrealistic.”
 
Volume of procedures is a key
factor in driving costs down. Surgeons and specialists in his Bangalore
Centre perform considerably more procedures than in the US. For example
the centre’s 42 cardiac surgeons performed 3,174 cardiac bypass
surgeries in 2008, more than double America’s Cleveland Clinic figure
1,367 in the same year.
 
“As with our Bangalore Centre, we will
be employing the same level of expertise, the same medical machinery and
the same trends of treatments received currently in the US but at a
vastly reduced cost,” Shetty confirmed. “There will be no compromise on
quality.”
 
Shetty’s medical centres in India are some of the
biggest consumers of General Electric’s medical equipment and machinery
in the world.
 
Although some might fear that an increase in
volume of procedures over their US counterparts might not necessarily be
a good thing for surgeons at the Narayana Cayman University Medical
Center, Shetty refutes this argument by stating that his doctors
actually perform better than those in the US because they become experts
in the procedures that they undertake because of their widened
experience.
 
“When cardiac surgeons retire in the US they may have undertaken between
2,000 and 3,000 procedures; whereas our surgeons have carried out over
3,000 by their mid 30s. I stopped counting how many cardiac procedures I
have undertaken when the figure reached between 10,000 and 15,000,” he
said.
 
The issue of med malpractice insurance.
Medical malpractice
insurance is increasing rapidly in the US, to the point where some
physicians, such as Ob/Gyn surgeons are refusing to undertake risky
procedures because the cost if they are sued is just too high. This is
one area of cost where the Cayman Islands government intends to position
itself favourably in comparison to the US and this will therefore be a
greater incentive to physicians at the Narayana Cayman University
Medical Center.
 
“The government has been reviewing the possibility of reforming the law
as it stands on medical malpractice insurance for some time, even before
the Narayana Centre was contemplated here,” Health Minister Mark
Scotland says. “Medical malpractice insurance has tripled or even
quadrupled in recent years for local physicians, so we will be looking
to limit the malpractice or negligence awards to plaintiffs in respect
of non-economic losses.
 
This will not affect those who sue for loss of earnings and other
economic costs when medical malpractice or negligence has taken place.
Having reviewed this for some time we are proposing to follow the Texas
model in this regard.” The State of Texas adopted a comprehensive tort
reform bill in 2003. Many significant changes in the law, including a
cap on non-economic damages, were instigated.
 
Although Scotland does not believe necessarily that this will
significantly reduce the cost of insurance, he does believe it will have
other benefits including giving physicians the confidence to operate in
Cayman and insurers more confidence as well.
 
An aggressive build time-frame.
Construction for the Centre is
set to break ground in January 2011 with the first phase due for
completion around 18 months later. The first phase is scheduled to house
around 200 beds, specifically for cancer, cardiac, orthopaedic and
major general surgery patients. It is estimated that there will be
around 600 to 800 staff, of whom it is anticipated that around 150 to
200 will be Caymanians. Total investment by Shetty and his investors is
expected in the US$1 billion to $2 billion region.
 
Shetty anticipates that the entire project, which will include a
university he expects will train Caymanians for jobs within the centre,
will be completed in around 15 years through a multi-phased development.
There is also discussion that links will in the meantime be forged
between the University College of the Cayman Islands and the centre for
the formation of some kind of medical faculty.
 
“The development will occur as the market dictates,” Scotland advises.
“In this way Cayman will not be overwhelmed by development or
individuals all at one time.”
 
David Legge, who is acting as Shetty’s on-island communications manager,
says that larger infrastructure such as the airport and airlift,
accommodation, roads etc., will not require any major alterations within
the first five years or so of the project, but after that they will
most likely need to be carefully reviewed.
 
Who will benefit?
Legge states that they anticipate that
patients will come predominantly from the US but that they will also be
targeting countries elsewhere for marketing purposes.
 
“We expect that around 50 per cent will be from the US, with the
remainder coming from Canada, South America, the Caribbean, Europe and
elsewhere,” he states.
 
Scotland says the top surgeons and specialists will initially be brought
in from overseas to run the new centre and that no one country will
have the monopoly on staffing to ensure a good social mix.
 
Legge adds: “Many of the key personnel heads of department will
initially be coming from the US so North American patients will have a
certain level of comfort interfacing with their American counterparts.”
 
There will also be tremendous opportunities for Caymanians to take
advantage of jobs not only within the centre, but with the ancillary
services that such a project will attract.
 
“The political will is there to ensure that Caymanians get their fair
share of opportunities,” Scotland says. “The agreement signed with the
Narayana Centre only permits for the development of the centre itself
and not surrounding businesses, which will help facilitate the centre,
such as restaurants, shops, hotels, convalescence homes, accommodation
and so on,” he states.
 
Scotland says the government will help interested Caymanians retool to
ensure that they are up to speed with the stringent requirements of the
new centre while Legge says that all Caymanians working at the centre
will be adequately trained to the skill levels needed.
 
In particular, there will be great opportunities for Cayman’s IT
industry to flourish with the onset of the new centre.
 
“Dr. Shetty’s centres in India are on the cutting edge when it comes to
technology,” Legge says. “And India is at the epicentre of the world’s
IT programmers. Dr. Shetty’s institutions are experts at matchmaking the
worlds of IT and medicine. They are pioneers in the science of
telemedicine, developing communications with hospitals all around the
world using instructional videos to perform highly sophisticated
surgeries and techniques.”

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The Cayman contingent takes a tour around Dr. Shetty’s facility in India

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