Catch a Falling STAR: Sustainable Financing for a BoP Hospital

by: Paul Clyde

Publication Date: May 16, 2011
Length: 21 pages
Product ID#: 1-429-173

Core Disciplines: Base of the Pyramid, Strategy & Management

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Teaching Note

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Third Place Winner of the NextBillion 2011 Case Writing Competition STAR, a comprehensive mission hospital in India, is facing an impending decrease in donations, which currently comprise nearly 50% of total funding. Its founder, Gautam Vora, must consider altering its business model to adopt more sustainable financing mechanisms. To do so, he benchmarks three other hospitals that serve the BoP: Virika, a maternal health center of excellence in Uganda; Muni Seva Ashram, which includes both a comprehensive hospital (APAM) and cancer hospital (KCHRC), in India; and Narayana Heart Hospital, a large cardiac care-focused hospital in India. The hospitals are compared according to their formation and history, context, services provided, assets, and financing structure. This case is applicable to a variety of courses in business and health management.

Teaching Objectives

After reading and discussing the material, students should:

  • Gain an understanding of different financing mechanisms to achieve self-sustainability available to hospitals serving the BoP.
  • Identify operational aspects of a business model relevant to each of the financing options -- both facilitators and barriers.
  • Gain a nuanced understanding of the role of leadership in making critical business decisions, particularly in the context of moral imperatives unique to the delivery of healthcare to the underserved.