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Beyond training doctors, a separate department at the hospital coordinated the training of nurses. The 700 nurses at NH were required to complete a year of training, which included a minimum six-month period in a critical-care unit. As a result of intensive instruction, NH nurses were known across the state for their abilities and dedication; a writer to a Bangalore newspaper once likened each of them to Florence Nightingale. The downside to the excellent training, though, was the high turnover as skilled nurses sought better opportunities overseas. Ms. Rohini Paul, the director of nursing, said, “Although we pay the highest salaries [in Bangalore], we lose many of our nurses because the skills they learn here will earn them better pay abroad, but this does not worry us, since there are so many more nurses waiting to join.”
In addition to training nurses to specialize in cardiac care, the college of nursing, which was housed within NH, offered degree and diploma courses for trainee nurses. To encourage students from poor remote areas, who would benefit most from these educational opportunities, NH arranged to guarantee bank loans to cover fees and living expenses. In return, the trainee nurses worked at the hospital during their course and for up to two years afterwards, thus supplying much-needed manpower.
The passion to serve the masses also drove Dr. Shetty to develop an insurance program called Yeshasvini. With an established name in Karnataka for his work in cardiac care, Dr. Shetty was approached by a milk cooperative for an endorsement of its product. As he learned about the membership of the cooperative and their demographic profile, however, it occurred to Dr. Shetty that this could be the opportunity he had been seeking to access a clustered and organized group of middle- to low-income people with poor access to health care.
Armed with this vision, the team at NH set up a health insurance scheme for 1.7 million farmers and their families in Karnataka. Yeshasvini was launched in 2002 for farmers belonging to various state cooperatives—all farmers who had been members of a cooperative for at least a year were eligible to participate, regardless of their medical histories. For Rs. 5 (US$0.11) a month, cardholders had access to free treatment at 150 hospitals in 29 districts of the state for any medical procedure costing up to Rs. 100,000 (US$2,200). (See Exhibit 15 for a breakdown of procedures performed at NH alone under this scheme.)
Prior to the scheme, it was estimated that the average occupancy of hospitals in Karnataka was only 35%; although the state boasted 30 private medical colleges, each with over 500 beds, actual occupancy was low, reflecting the lack of affordability rather than a lack of infrastructure. While microinsurance schemes had existed in various forms in developing countries, the efforts were often unsystematic, resulting in little success. Recognizing this, Dr. Shetty chose to utilize the existing government infrastructure, in the form of the state-controlled cooperative societies of Karnataka. In particular, the principal secretary of the cooperative department (of the government of Karnataka), A. Ramaswamy, lent his support to the project and arranged for the involvement of the then-chief minister, S.M. Krishna. Yeshasvini was launched as a state program, with the government contributing Rs. 2.5 for every Rs. 5 paid by the farmers.
By collecting the insurance fees up front for a year, the Yeshasvini Trust (which was created to own the scheme) was able to minimize the initial need for funds. Research by the NH team estimated that only 8% of the policyholders would require medical procedures, thus the total funds collected were expected to cover the cost of treatment for those in need. In order to keep the up-front collection costs to a minimum, the state government made available its post offices to collect the Rs. 5 premium, track monthly payments, and issue a “Yeshasvini member card.” The initial task of getting the hospitals to participate and selling the idea to cooperatives was conducted by the trust, but the daily operations were later handled by a third-party administrator, which also coordinated payment to hospitals.
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