Socio-Cultural Sustainability of Private Healthcare Providers in an Indian Slum Setting: A Bottom-of-the-Pyramid Perspective

Abstract

Delivery of affordable healthcare services to communities is a necessary precondition to poverty alleviation. Co-creation approaches to the development of business models in the healthcare industry proved particularly suitable for improving the health-seeking behavior of BOP patients. However, scant research was conducted to understand BOP consumers’ decision-making process leading to specific healthcare choices in slum settings, and the relative balance of socio-cultural and socio-economic factors underpinning patients’ preferences. This article adopts a mixed-method approach to investigate the determinants of BOP patients’ choice between private and public hospitals. Quantitative analysis of a database, composed of 436 patients from five hospitals in Ahmedabad, India, indicates that BOP patients visit a public hospital significantly more than top-of-the-pyramid (TOP) patients. However, no significant difference emerges between BOP and TOP patients for inpatient or outpatient treatments. Qualitative findings based on 21 interviews with BOP consumers from selected slum areas led to the development of a grounded theory model, which highlights the role of aspirational demand of BOP patients toward private healthcare providers. Overall, healthcare provider choice emerges as the outcome of a collective socio-cultural decision-making process, which often assigns preference for private healthcare services because of the higher perceived quality of private providers, while downplaying affordability concerns. Implications for healthcare providers, social entrepreneurs, and policy-makers are discussed.