Aravind Eye Care System: Eliminating Needless Blindness | Market Based Systems Change Case Study

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Aravind Eye Care System

Eliminating needless blindness Founded by Dr. Govindappa Venkataswamy | India


What’s At Stake

12 12 million of the 37 million people in the world with blindness are in India (source: The Hindustan Times)

.02% India faces a significant shortage of optometrists: .02% of the need is currently being met. While 40k optometrists are needed, there are only 8k (source:Times of India)

India has the highest number of blind people in the world. Of the 37 million blind people across the globe, over 12 million are from India. The country faces a significant shortage of optometrists; while it needs 40,000 optometrists, it has only 8,000. (source: Times of India) Moreover, the public health system’s capacity is inadequate to meet the health services demands. However, 80% of all vision impairments can be prevented or cured if patients receive the right treatment, and on time. (Source: WHO) Aravind Hospitals was founded to find sustainable ways to offer eye care, particularly to prevent or cure blindness, for all those who need treatment, regardless of ability to pay.


Business Model Innovation

If you had visited the 11-bed, Aravind Eye Hospital in 1976, it would have been hard to imagine that it would expand to serve over 3.3 million outpatient visits a year (source: endeva) , have its model further replicated by over 320 hospitals around the world, and inspire approaches to tackling other diseases.

services such as patient screening - and after finding that it was only bringing in 7% of patients who needed care, they setup permanent primary eye care centers with the ability for doctors to perform rem ote exams via cameras - increasing reach to 40% within one year of adoption, and 70% by the second year.

Its drive to reinvent its model in radical ways began with a moment of failure. When its founding doctors, Dr. G. Venkataswamy (Dr. V) and Dr. G.Natchiar (Dr. GN), went to a neighboring city to fundraise from donors - they were turned away. They left with a deep sense of frustration: they had spent 10 days they could have spent treating patients - with nothing to show for it. From this experience, came core principles that drive Aravind Eye to this day:

Changing its business model was another key way to scale its services: finding ways to lower their costs by optimizing their resources. The first approach is by having a dual pricing model, where the wealthier, 50% of the patients, pay for the cost of 50% of the patients who cannot afford the surgeries otherwise. The hospital provides no differentiation in the quality of the medical service,except that the patient who pays gets a nicer outpatient experience with a private room.

• Turn no patients away • Give the highest level of care • Be self sustainable - don’t

operate on external funds

One of the first innovations was to design services for anyone who is not able to reach the existing eye care hospitals. They began by visiting rural areas to setup outreach camps that would offer

Aravind Eye Hospital also optimized their fixed costs - such as doctors and the operating theatre - so that they could begin performing almost 4 times as many cataract surgeries in a day than is the norm (from 15 surgeries per day to more than 50-60 per day). This was done by introducing a process innovation where in a doctors was provided two table for operating instead of 1 and creating a new role to support them,

At a Glance Revenue Model • Earned income via product/services sales and consulting

Innovation • Unaddressed Market • Pricing • Product design • Supply chain • Distribution • Sales and marketing


called the “middle-level ophthalmic personnel” (MLOP) to support the doctor, so that doctors could focus on surgeries instead of needing to spend time on tasks such as record keeping, suggesting lens options, or moving patients around in the theatre. By creating special training, the role did not require a nursing degree, thereby lowering the cost of each support personnel by 1/5 (from 50,000 to 10,000 rupees). Their founder, Dr. V., was famously inspired to make such changes based on observing the assembly line efficiency and volume of high quality service at place such as McDonald’s, visiting its Hamburger University in Illinois, shadowing janitors at airports to see how they clean toilets, as well as catering staff at 5 star hotels, to look for ways to reach new heights of resource efficiency.

overcome the prevailing wisdom that said that even though the Intra Ocular Lens (IOL) was a better procedure, it should not extend to other developing countries because of being too expensive. It partnered with another social entrepreneur, David Green, in 1992 to launch its own non-profit, on-site lens manufacturing. And as a result of not needing to rely on any intermediary suppliers, sales, or distributors, they were able to reduce the cost radically, from $100 at the time, to now only $2 per lense. It not only serves Aravind but also over 150 companies across the globe.

Four years later, in 1996, they partnered with the Lions and SEWA foundation for the initial seed launch of the Lions Aravind Institute of Community Ophthalmology (LAICO). LAICO provides consulting for hospitals to improve their cataract surgical But it didn’t stop rates as well. The Institute offers capacthere - after growing to two new locaity building by training in clinical areas, tions in Theni and Tirunelveli, Aravind training for improved administrative still continuously looked for new ways and managerial processes, vision building to reach the scale of the demand. Partwith leadership, and initial seed funding nerships were key. As, Dr. Devendra, to kickstart the new approach. It offers Manager Employee Engagement, deactive support for 2 years, followed by scribes, “We realized that Aravind can’t ongoing mentorship as needed afterwards. be everywhere. We have a global mission. As a result of openly sharing its model, the So we see others with similar visions as Aravind model has been replicated in over partners, and not as competition.” 300 eye hospitals in 30 countries, with a number of those hospitals becoming “We realized that Aravind can’t regional replicators of the model as well. be everywhere. We have a global mission. So we see others with A core part of Aravind’s training is similar visions as partners, and to shift the mindsets in hospital and not as competition.” eyecare towards explicitly committing to find ways to sustainably serve whoOne of its first partnerships was to ever is in need - and work openly with


partners to meet the scale of the demand. glaucoma and focus on primary eye As founder Dr. V. said, “Never restrict care” that could help prevent the need demand. Build your capacity to meet for surgeries. the demand” and that what’s needed is “not leadership in the sense of organizing and making it work. It’s leadership that comes from empathizing with the community.” LAICO has begun developing an e-learning platform, Aurosiksha, to reach more eye care professionals seeking training - from ophthalmologists and mid-level ophthalmic personnel, to managers, technicians, and researchers, as well as offering training of trainers. Since launching, they have already reached an additional 6,000 trainees from 99 countries. Aravind Eye Care System’s income depends partly on grants (10%), however, this is a part of it’s strategy to support other hospitals to replicate its model, and there is no dependence on government subsidies or international aid for its core operations. Having achieved self-sustainability and the impact of treating over 4 million cataracts, what’s next? “It’s always evolving,” says Dr. Devendra “We are moving our focus from cataract to other chronic eye-diseases - such as


Approach to System Change How Aravind is creating efficiencies in the eye care system in India

Aravind Eye Care system is an umbrella term for numerous, interrelated services such as its hospitals, outreach camps and centers, lens manufacturer, training center, eye bank, and more. It has been able to achieve this remarkable scale of impact by introducing new resources, roles, and relationships in eye care

At a Glance • Resources • Roles • Relationships • Mindsets


Eye care system in India How Aravind is creating efficiencies in the eye care system in India After

Before Resources

Resources

-Payments of patients

-Payments by patients (significantly reduced for poor patients) -Telemedicine infrastructure. -Open training materials for ophthalmic personnel

Rules & mindsets -High quality service for those who can afford it -“Patients need to come to us” -“Hospitals need to operate within the limits of traditional hospital funding models”.

Rules & mindsets -Explicit commitments to sustainably serve whoever is in need, regardless of

Roles & Relationships

ability to pay or who we need to work with -i.e. “We need to get to the patients” and “Let’s work together to eradicate blindness”.

Roles & Relationships

Train

Hospitals

Patients

Before After

provide trainning and mutual support to

Ophthalmology training institutions Traditional medical schools

Train

Lens manufactures

Ophthalmic opticians: Fully trained ophthalmic opticians

Results -Quality of service: good

Hospitals: Social venture focusing on impact and affordability conduct outreach & education (inc. telemedicine) via For only those that can afford it pay for treatment physically to.

-Cost of service: high -Accessibility: low (too expensive for most people in India) -Economic value created: doctors, hospitals, lens manufacturers (high margin, low volume)

Rural camps and centers

Patients

Ophthalmic opticians: Fully trained ophthalmic opticians Mid-level ophthalmic personnel Ophthalmology training institutions Traditional medical schools Ophthalmology e-learning platform. Lens manufactures On-site social venture focusing on impact and affordability

Results -Quality of service: same -Cost of service: low -Accessibility: high -Economic value created: doctors, hospitals, lens manufacturers (lower margin, higher volume than before)

*This is a simplified systems diagram, and not intended to be comprehensive. The analysis uses the “5Rs framework” developed by USAID. More information can be found here at usaidlearninglab.org


Resources

Before

After

Hospitals that provides eyecare are expensive or inaccessible

Created a cross-subsidized hospital model, where funds from people who can pay at one hospital are used to cover costs for people who can’t pay at a second sister-hospital that shares the same staff. The quality of care is the same at each hospital, with the main difference being the privacy and quality of facilities for outpatient care

Lense needed for the most effective surgeries are considered too expensive and inaccessible for those who are poor Training and education is expensive and only offered in-person, limiting how many trained eyecare professionals are available to less than is needed by the population

Traveling outreach camps, stationary vision centers with telemedicine capabilities, and offering transportation and accomodation for rural patients increase the number of new patients in rural areas by up to 30% The establishment of on-site manufacturing lowered the cost of lens needed for surgery from $100 to $2 by simplifying the supply chain. The e-learning platform, Aurosiksha, enables more eye care professionals to gain training without needing to travel

Roles & Relationships

The majority of eye care tasks are performed by highly trained professionals - mainly doctors and nurses; they are highly paid and there are not enough professionals to meet the demand

Hospitals are run in a way to maximize profit and do not regularly work with other, outside hospitals

Tasks that do not require specialized tasks are transferred to new role - Mid level ophthalmic personnel (MLOP). So they don’t have to spend time with records, suggesting lens, moving the patient around in the theatre. The resource optimization helps to reduce the overall costs per patient, and enabled 4 times as many surgeries to be performed The Lions Aravind Institute of Community Ophthalmology (LAICO) pro vides consulting to hospitals on improving their cataract surgical rates and creates a ripple effect: encouraging hospitals to train additional hospitals to replicate the model as well (training the trainers)


Rules & Mindsets

Before

After

Healthcare centers work within their own company’s network and focus on meeting the immediate demand from those that can afford their services

A core part of Aravind’s training is to shift the mindsets in hospital and eyecare towards the idea that it is feasible and sustainable to provide high quality care to those that are poor, and that its necessary and beneficial to work with others as partners - not competitors - towards meeting the scale of the demand

High care quality for the poor is not considered practical or realistic

Results

Large prevalence of needless (preventive) blindness in developing countries.

Affordable eye care is available at scale and reaching rural populations, while allowing hospitals to remain self-sustaining

Many cases of eye-diseases going unidentified, especially in rural populations

High-quality training for eye care professionals is more easily accessible and affordable

Only one organization had the capacity to conduct this work under this system

Hospitals are openly replicating the high-impact model, and training other hospitals to do the same Innovation in medical process to increase surgeon productivity by optimizing staff tasks has spread to the treatments of other diseases


The Impact

·

·

Aravind Eyecare System treats over 4.1 million outpatient visits a year, with over 32 million patients treated and over 470.000 surgeries performed since its founding. Innovations by Aravind and its network of partners have lead to results such as increasing the productivity so that it is able to perform 4x as many surgeries than the norm and the quality of care remains high, with surgical complications at half that of eye hospitals in Britain Aravind’s onsite lens manufacturer has been able to drive down the cost of lense needed for eye surgery from $100 to $2. It has produced lens for over 20 million people in over 140 countries across the globe

At a Glance • Growth • Joint Ventures/ Partnerships • Open Source • Campaigns/ Movement Building • Training/ Consulting


·

The Aravind Eyecare model has been replicated by over 320 hospitals in 27 countries around the world and has lead to these hospitals also spreading the model further. For example, in 2013, Visualiza hospital in Guatemala learned from Aravind’s model and, with the support of other partners as well, grew to perform over 20% of all cataract surgeries for its country despite having only 2% of the nation’s ophthalmologists, having only 55 staff, and having the majority of patients either subsidized (80%) of free (10%). Visualiza has then conducted capacity building for clinics in other countries including Peru, Nicaragua, Haiti, Mexico and Honduras, with the clinic in Peru doubling its key clinical indicators in less than 2 years. The Lumbini Eye Institute(LEI) is another example. Following capacity building with Aravind and other partners, they were able to scale to provide 25% of all eyecare surgeries in Nepal and is building institutional linkages in countries such as Tibet and Cambodia

·

Aravind’s approach to creating greater access to affordable, high quality care has been applied to other areas of healthcare such as maternity hospitals, cancer treatment, and AIDs prevention; for example, AIDS prevention circumcision surgeries by those using the World Health Organization’s guidelines have increased the surgeries possible per day has increased from 5 to 7 times the norm


Key Ingredients for Success

Look for Pathways to Scale Beyond Growth: Once it had established a successful, high-impact model, Aravind did begin its quest to scale its impact by beginning to grow its locations, and established hospitals in two new, high-demand areas. However, it realized that even at this rate, it was still not going to reach the scale of the millions of people who were still facing unnecessary blindness, both in India and abroad. It’s with this in mind that they deliberately sought new strategies to reach scale, such as open-source consultation, training, and consulting, developing trainings for trainers of eyecare staff, and outreach and education campaigns. Enable Start-up Resources & Seed Funding for Open-Source Replication: In order to enable others to replicate their model, Aravind purposely set out to raise funds for other organizations and NGOs. Doing so has been a key component to Aravind’s replication success. Dr. Devendra describes how, “We raise funds that can be used for initial vision building workshops, trainings, and have created provisions to allows for funds to be given to the replicating organization directly as well so that they can kickstart the project they have ideated while attending trainings hosted by Aravind.”

This enables organizations to overcome the financing bottleneck that Aravind observed in the past, allowing those that have been trained to take the first step in applying their learnings to their own model. Have a shared-vision to Create Partners, Not Competitors: By continuously looking for new ways to scale and showing in their decisions that finding ways to meet the full demand of their target population was a priority, Aravind has generated a strong network of partners. In order to do that, partners who share their vision have been key. As Dr. Devendra, describes, “We realized that Aravind can’t be everywhere. We have a global mission. So we see others with similar visions as partners, and not as competition.”


Pitfalls to Avoid

1 Choose Investors Carefully: Dr. Devendra identifies one the biggest challenges that startups face as entering into funding or angel investor obligations that dilute the organization’s original impact-purpose. He recommends that you carefully choose your funding partners and only agree to commitments that will not take away from your organization’s impact-purpose, taking every decision from this lense. Ideally, Dr. Devendra recommends, find a business model that would allow you to become self-sufficient without relying on other fundraisers and angel investors. He describes how, “We won’t take the money if it doesn’t carry our mission forward. For others who don’t have that value system -just because money is coming their mission might diverge. We have seen this happening.” 2 Align Values with Vision: Ensuring that all leadership and staff are fully aligned with the type of values that are needed to truly deliver on their vision has been key for Aravind’s success. Based on training hundreds of potential replicators, the greatest challenge Aravind has seen to others successfully replicating their model is the new teams’ also not taking enough time to build and com-

mit to shared values that identify why they are adopting and contextualizing this new eyecare model. “Until now,” Dr. Devendra describes, “people have tried to copy the systems but they have not been able to copy all of the elements in the new local context. There are three parts of an organization: 1) the why - values and why they are doing it 2) the what - what they do, and 3) how - the operations. Organizations have not necessarily taken the ethos - and that doesn’t work.” For this reason, Aravind builds specific trainings for, and is looking for new ways, to help new hospitals identify their value system and help them to build their value systems. For Aravind, core values have included treating every patient with respect and compassion regardless of ability to pay, turning no patients away, and relentlessly finding new partners and businesses to be self-sustainable. For example, at Aravind, Dr. Devendra describes,

“Patient centricity is needed for any decision. Say an equipment or process does not help the patients, or software, then we don’t go for it.”


Acknowledgements ❏

Authored by Reem Rahman, Olga Shirobokova, Odin Mühlenbein, Nadine Freeman and Mark Cheng for Ashoka Globalizer

Interviews by Ken Banks (FrontlineSMS), Michael Feerick (Alison), Steve Song (VillageTelco), Dr. Devendra (Aaravid Eye Care Systems), and Tristram Stuart (Toast Ale) Creative Commons creativecommons.org/licenses/by-sa/4.0 Licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.