Doctor, doctor

UAE-based distributor Imtac Technologies recently launched a spin-off firm, iCT Health based in Dubai Healthcare City (DHC) to provide software platforms for healthcare providers. Imthishan Giado sat down with vice president and COO, Gautam Dey to discuss the firm’s plans

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Doctor, doctor DEY: Any slowdown from people leaving will be counterbalanced by the retail pharmacies coming in.
By  Imthishan Giado Published  May 23, 2009 Arabian Computer News Logo

What is Imtac’s background in the Middle East?
We have been in this industry for 24 years – this is our 25th in the healthcare industry. In parallel, we have also been in the IT industry because we originated out of Hewlett-Packard.

When HP first came into Oman 25 years ago, they couldn’t work in Oman legally as an international company. Imtac was set up to do HP’s business in Oman. HP had an IT division and a healthcare division, so Imtac had the same divisional structure.

In April 2008, we were acquired by a group which originated in Oman but is very strong in India called the Shobha Group, which has a strong portfolio in healthcare products in terms of IT.

What we did since April is to merge the operations of these two companies. I now look after the healthcare business globally.

You’ve been operating as Imtac Technologies for the past six years. What drove you to open this new firm?

The primary driver was making healthcare insurance mandatory. Today if you fall mildly sick, you go to a physician, take medication that he prescribes, pay him cash if required, and pick your medication from a pharmacy. You may or may not have healthcare insurance – till January 1 in the UAE, it was not mandatory and depended on either yourself or your parent organisation.

What healthcare insurance does is to make healthcare move from a cash business to a credit business. You take treatment via a cashless transaction, and a financial settlement happens later. To make this transaction, one way is to submit a bill and wait for payment. The other is to submit it online, process and reimburse it online and settle online. In most mature economies where healthcare insurance has been there for over 20 years like the US, it’s all online claim settlement, just like in the banking sector.

To have online claim settlement, you have to assume that any provider of care has access to an IT system by which he is able to log-in a claim online. Now that’s not true.

Physicians by definition are averse to IT systems. But now, with e-claims being a mandatory norm, you have to have a system. Our business model is based on the fact that we intend to provide software as a service.

Do you focus on the insurance industry or physicans?

Both. First I need to generate claims electronically, which means that I have to provide software as a service to the provider community. This can either be hosted by us or if it is a multi-facility provider can be hosted by him within his premises.

For using the system, he pays a transaction fee, just like pay television. The system then allows him to log in a claim in the format as specified by Dubai Health Authority or the Health Authority Abu Dhabi. This claim goes and hits a switch which then routes the claim to the appropriate insurance company or the third party administrator.

They get systems that receive the claims and then do a validation of it based on content, protocol, plan coverage and clinical assessment.

Apart from the obvious co-branding effect, how does having an office in DHC help your business?
We are going to run a pilot out of DHC where all the software hosted by us will be provided free to a selected number of users. City Hospital is already our client because they are a volume generator of claims. The Welcare Group probably generate about 30%-40% of Dubai’s entire claims. The total value of claims that are expected to go through any system is expected to be more than $272 million each month.

This is roughly expected to be a minimum of 200,000 claims. Statistics released by the insurance companies show that about 30% of the working population had insurance. We cannot predict how often people fall sick, so we can only do a gross estimation.

Is that figure expected to increase in the future?
It will go up as you bring the retail pharmacies into it. Today the figures are excluding the retail pharmacies totally, it’s only from the hospitals. The hospitals also try to do a complete claim, whereas with a single physician, you might get multiple claims. These numbers will change dramatically once you have the entire network covered – after that, it’s anybody’s guess.

The only thing is that if you see a slowdown in the economy or people leaving, that will counterbalance the growth that you expect when you have the retail pharmacies coming in.

However, the insurance business is something which historically, in every country, including the US market, shows no signs of going into recession.

Do you consider healthcare IT specialists like Cerner competitors?

Cerner is a hospital information system company. They specialise in putting in enterprise hospital information systems to large hospitals. They do not work in the insurance space. We have our own systems in those markets – those systems we believe provide more economic value to the healthcare community.

The days of people spending a million dollars on software license, I think are effectively over. With this crisis, people will think twice about making a capital investment of that size. There will be some who will still do it but that represents about 5% of the market globally in healthcare. That is a market we would prefer not to be in.

We would be in the market for providing software and solutions for people who believe that software is a tool that empowers the care process, but does not drive it.

What size of the market are you aiming to capture here?
Take 2% of $272 million per month – that’s your market size on the insurance side. That’s on the claims side of things. That’s phase one of our business model. This is a standard business model which people use globally. The difference that we bring now is since we are storing the claim for further adjudication in a clinical data format. Most other people store the claim (including the US) on a standard data format.

What do you consider the biggest challenge to working in the Middle East?
In this part of the world, the business model for healthcare is still not refined. You get changes in regulatory requirements very often. This can only be addressed by an architecture which allows you to incorporate those changes and still retain downward compatibility with what has been done before.

That’s the biggest challenge, but since we have been in this part of the world for 15 years, we were used to this challenge.

When do you see this maturity arriving in the region?
It will become mature very fast because we have the ability to learn from all their 30-40 years of mistakes and come up with the correct model very fast. You will see maturity in the healthcare insurance industry probably coming in two years.

At the end of the day, a standard is what works for a market, it doesn’t drive a market. What I like about the UAE is the fact that it has got very good infrastructure and an ability to innovate. It’s not that they are totally dependent about taking a model from either the US or Europe and plonking it here – it’s something that they can do new and it’s business-model driven rather than standards-driven.

One benefit here is that excessive legislation and the legal interference in healthcare which raises the cost of healthcare is thankfully not present in this part of the world. In effect, it is actually better here than there.

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