- In September 2024, Lord Darzi’s report warned that England's NHS was nearing collapse
- Cloning Dr. Devi Shetty’s Narayana Health model could address challenges highlighted in the Darzi report
- Shetty’s Narayana Health proves that high-quality care can be affordable and accessible to large populations, debunking the idea that higher costs equal better care
- Western healthcare systems can adopt Shetty’s cost-efficient, tech-driven approach to create sustainable, equitable care, especially for aging populations
- Narayana Health’s high-volume, low-cost model offers a blueprint for improving efficiency and expanding access to underserved communities
- Western healthcare leaders can follow Shetty’s example by embracing flexibility and innovation to meet rising demand and limited resources
Revitalising Western Healthcare: Insights from Devi Shetty and Narayana Health
In September 2024, Lord Darzi’s Independent Investigation of the National Health Service (NHS) in England revealed a system on the verge of collapse, where patient confidence in the NHS's capacity to provide timely care is rapidly eroding. Although Darzi, a professor of surgery and former health minister, delivered a thorough and authoritative diagnosis of the NHS’s challenges, his mandate did not extend to offering concrete solutions.
Dr. Devi Shetty and Narayana Health in India offer a compelling blueprint for Western healthcare reform with their innovative model. By prioritising efficiency, scale, and compassion, Narayana Health has dramatically lowered costs while maintaining world-class standards. Established in 2000, it has grown into a vast network of hospitals, serving millions annually, including an international outpost in the Cayman Islands. Through innovative methods such as economies of scale, telemedicine, and affordable pricing, Narayana Health has succeeded where many Western systems falter - delivering world-class healthcare at a fraction of the cost.
 The US spends ~$4.5trn annually on healthcare - >17% of GDP - yet millions remain uninsured or underinsured. Meanwhile, the UK's NHS, funded through taxation, faces persistent disparities and long waiting lists. Both systems are burdened by rising costs and unequal access. In contrast, Narayana Health's success shows that affordability and quality care can coexist, pushing Western nations to rethink their costly, inefficient models. Shetty's approach offers a credible case study for addressing healthcare crises in developed nations, aligning with Darzi’s call for future healthcare investments to prioritise services beyond hospitals.
Shetty's work exemplifies how innovation, compassion, and cost-efficiency can transform healthcare delivery, providing hope for more equitable systems in the US, UK, and beyond.
In this Commentary
This Commentary examines Dr. Devi Shetty's healthcare model at Narayana Health in India as a potential blueprint for reforming Western healthcare. Faced with aging populations, rising costs, and workforce shortages, Western systems could benefit from Shetty’s approach, which emphasises: (i) streamlining operations without compromising quality, (ii) scaling best practices, (iii) expanding access to care, (iv) reducing long-term costs, (v) improving affordability, (vi) leveraging core strengths for better outcomes, (vii) optimising resources, (viii) fostering inclusivity, (ix) embracing innovation, and (x) designing for the future. The Commentary argues that by adopting strategies like process efficiency, task-shifting, and telemedicine, healthcare leaders can cut costs while maintaining high standards of care. It also explores the role of micro-insurance and public-private partnerships in expanding access to underserved communities, advocating for a more flexible, innovative, and inclusive healthcare system in the West.
Narayana Health
Founded in 2000 in Bangalore (now Bengaluru), Narayana Health began with a single hospital, Narayana Hrudayalaya, which quickly gained acclaim for its approach to cost-effective cardiac care. Over the next two decades, Narayana Health expanded rapidly across India, building a vast network of multispecialty hospitals, primary care facilities, and its flagship super-specialty cardiac hospital, which is one of the largest in the world. This facility includes 23 dedicated operating rooms, five digital catheterisation laboratories (including a hybrid lab), 200 critical care beds for post-operative patients, and one of the world’s largest paediatric intensive care units. Through economies of scale, telemedicine, and a strong commitment to accessibility, Narayana Health has grown to include >30 hospitals and >7,000 beds, serving millions of patients annually. The organisation marked its international expansion in 2014 with the establishment of Health City Cayman Islands, a state-of-the-art facility offering a wide range of medical services and emerging as a medical tourism hub in the Caribbean. Today, Narayana Health stands as one of India’s largest healthcare providers, known for its large-scale operations, high patient volume, and unwavering dedication to affordable care. This model offers lessons for Western healthcare systems like the US and the UK, where high costs and access barriers persist. Streamlining Without Sacrificing Quality Rising healthcare costs in Western systems are driven by advanced technology, expensive treatments, and administrative inefficiencies. Narayana Health demonstrates that affordable, high-quality care is possible through streamlined operations and centralised supply chains. By performing surgeries in high volumes, they lower per-patient costs, proving that efficiency need not compromise quality. Western systems can adopt similar strategies by cutting administrative overhead, standardising protocols, and shifting routine tasks to non-physician staff - driving cost savings without affecting care standards. Scaling Excellence Narayana Health’s success stems from its high-volume, low-margin model, which lowers the cost of advanced care. Performing a large number of surgeries enables economies of scale, making quality healthcare accessible to more people. This approach is relevant to Western healthcare, where the cost of individual procedures drives up expenses. Establishing specialised centres for high-demand procedures, such as joint replacements or cardiac surgeries, would concentrate expertise, boost efficiency, and reduce costs, while maintaining high-quality care. This strategy offers a sustainable path to addressing healthcare affordability. Expanding Access to Care Devi Shetty played a pivotal role in the success of the Yeshashwini micro-health insurance scheme, which was launched in 2003 to provide affordable healthcare to rural farmers in Karnataka, a state in the southwestern region of India. This visionary programme, driven by Shetty’s leadership, offered low-cost insurance that covered a wide range of medical treatments, including surgeries, for a minimal annual premium. By leveraging Narayana Health’s infrastructure and medical expertise, the scheme made quality healthcare accessible to millions of low-income individuals who had previously lacked coverage.
 In 2024, Shetty and Narayana Health introduced the the Aditi health insurance plan, designed to address the healthcare needs of India’s growing middle class. The plan provides coverage of up to US$120,000 for surgeries and US$6,000 for medical management, all for an affordable annual premium of just US$120. Aditi goes beyond just financial protection, focusing on preventive care by offering discounted health check-ups and proactive health management. This initiative aims to remove common barriers such as hidden fees and long waiting periods, ensuring timely access to life-saving treatments.
The success of Yeshashwini and Aditi underscores the potential of innovative insurance models to address healthcare gaps worldwide. Western countries, particularly those with underserved populations, could adapt such frameworks to offer affordable coverage for preventive and essential care. Public-private partnerships could be instrumental in scaling these models to meet the needs of low-income and rural populations, helping to bridge healthcare access gaps in more developed nations. Reducing Long-Term Costs Preventive care is often underemphasised in Western healthcare systems, leading to higher costs associated with managing chronic diseases and emergency care. Narayana Health’s model, which integrates preventive care with its insurance schemes, offers an example of how a focus on prevention can reduce long-term healthcare costs.
Western healthcare providers and insurers might consider prioritising preventive care within their systems. By emphasising early interventions and preventive measures, healthcare systems can reduce the burden of chronic diseases, which are particularly prevalent among aging populations. This approach improves patient outcomes and reduces the overall cost of care, making healthcare more sustainable in the long run. Extending Access and Reducing Costs Narayana Health’s use of technology, particularly telemedicine, is another area where Western healthcare systems can learn lessons. Telemedicine allows Narayana Health to provide care to remote populations at a lower cost, improving access to healthcare for those who might otherwise be underserved.
In Western countries, particularly those with significant rural areas or aging populations, telemedicine has the potential to play a transformative role. By leveraging telehealth, AI-driven diagnostics, and remote monitoring, healthcare systems can extend access to care while containing costs. This is especially important in managing chronic conditions, where regular monitoring and timely interventions can prevent more serious and costly health issues.
Leveraging Strengths for Better Care
Narayana Health's collaboration with governments to provide affordable healthcare through insurance programmes highlights the potential of public-private partnerships in improving healthcare delivery. In many Western countries, public healthcare systems are stretched, while private options are often inaccessible for large segments of the population.
Expanding these partnerships could pave the way for hybrid healthcare models that harness the strengths of both sectors. Public systems would focus on core infrastructure and essential services, while private providers could offer specialised care at reduced costs using scalable models like those of Narayana Health. This approach would ease the financial burden on public systems while enhancing the quality and accessibility of care, making advanced medical services affordable for more people. These partnerships offer a strategic solution to the growing healthcare challenges in the West.
Maximising Resources
Public-private partnerships present a promising route to hybrid healthcare models that combine the strengths of both sectors. Public systems could concentrate on providing infrastructure and basic care, while private providers deliver specialised, high-quality treatments at lower costs through efficient, scalable methods, as exemplified by Narayana Health.
This collaboration would alleviate the financial strain on public healthcare systems, which often operate with limited resources, by distributing responsibilities across both sectors. At the same time, it would make advanced medical services more accessible and affordable to a wider population. By blending private sector innovation with the equity of public healthcare, such partnerships could help tackle the complex healthcare challenges facing Western countries today.
Ensuring Inclusivity
A key strength of Devi Shetty’s healthcare model is its dedication to providing affordable care for low-income populations. In Western countries, where income inequality impacts healthcare access, innovative models are needed to extend quality care to underserved communities.
Western healthcare leaders could adopt strategies such as tiered pricing systems or sliding-scale fees based on income, as well as expanding subsidised care for lower-income groups. By prioritising affordability, these initiatives can help reduce health disparities and ensure that more people, regardless of income, receive the care they need. This would improve individual health outcomes and enhance overall public health.
Embracing Change Shetty’s success stems from his entrepreneurial approach and willingness to disrupt conventional healthcare models. In contrast, Western healthcare systems often resist change, weighed down by entrenched practices and inertia. However, technological advancements and shifting demographics demand greater flexibility.
Western healthcare leaders must embrace new business models, pricing structures, and care delivery systems to meet their evolving challenges. Moving from maintaining the status quo to fostering a culture of innovation will be key to improving healthcare accessibility and affordability in aging societies. By encouraging experimentation and change, leaders can better respond to the needs of their populations. Designing for the Future Narayana Health’s model stands out for its scalability and adaptability across diverse settings, without sacrificing its core principles of high-volume, affordable care. From a single hospital, it has expanded to multiple locations, consistently maintaining quality and efficiency. This success is driven by streamlined operations, centralised procurement, and a focus on high-volume procedures, which reduce costs per patient.
In contrast, Western healthcare systems struggle with scaling due to bureaucratic hurdles, regulatory barriers, and fragmented services. To address these challenges, scalability should be prioritised in healthcare reforms. Leaders must design systems that can be easily expanded and adapted to meet increasing demand, particularly in underserved areas. By adopting scalable models like Narayana Health’s, Western healthcare can ensure that innovations benefit larger populations, extending advanced care beyond isolated regions and improving access for all.
Takeaways
The healthcare model pioneered by Devi Shetty at Narayana Health offers a compelling pathway for reforming Western healthcare systems, which face mounting challenges. The recent Darzi report authoritatively diagnosed the issues confronting NHS England - such as aging populations, rising costs, unacceptable waiting times, and workforce pressures - but did not offer solutions, as this was outside its remit. Shetty's model provides a practical approach that could inform future reforms in the West. Narayana Health demonstrates that high-quality, affordable care can be achieved through innovation and efficiency. By focusing on high-volume procedures, streamlined operations, and creative insurance solutions, it delivers world-class healthcare to millions in India. Western healthcare leaders could adopt similar strategies, including task-shifting, centralised procurement, and scalable insurance models, to lower costs and improve access, especially for underserved populations. Telemedicine and preventive care, both key elements of Shetty’s model, could also play transformative roles in making healthcare more sustainable and inclusive. By embracing these innovations, Western healthcare systems could overcome many of the challenges outlined in the Darzi report, ensuring more equitable and accessible care for all.
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5 months, 4 weeks ago
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