PB Health’s hospital expansion plans on track: PB Fintech Chairman and Group CEO

PB Health is a separate venture and will see no change in its hospital expansion plans, said Yashish Dahiya, Chairman and Group Chief Executive Officer of PB Fintech Limited - the parent company of Policybazaar.

Responding to whether a possible impact on its insurance business from a recently proposed policy change would cast a shadow on its healthcare investment plans, Dahiya told businessline, PB Health is a totally separate venture with its own team and execution. “So no, that doesn’t get impacted by what goes on at the Policybazaar end...If there are challenges at the Policybazaar end, this part actually becomes even more important,” he said, indicating that their investment plans for about 150 hospitals in five years, were on track.

A recent IRDAI consultation paper had proposed changes in insurance distribution commissions among other things, adversely impacting PB Fintech’s stockprice last week. And Dahiya had flagged a possible revenue impact from the insurance proposal.

With PB Health being the healthcare venture from the group, concerns also emerge of a possible slow-down of its hospital expansion plans. Dahiya, however, clarified, “this investment (in hospitals) comes from external investors and the Policybazaar balance sheet, and the balance sheet is intact and there’s no challenges there.”

The plan is for about 20-30 new hospitals, and the rest through partnerships or franchise operations, he said. PB Health presently has multi-speciality hospitals at Noida and Gurugram. With a plan for 200-bed hospitals, the target is for four hospitals by March, and another six in the next year, followed by a more rapid expansion, he said. The funds would be from a combination of equity and debt, he said, of the investment outlay of ₹10,000 crore. The larger plan is to build a network of 500 hospitals, a company representative added.

While groups like Narayana Health have gone from hospitals to health insurance, PB Health is doing the opposite. Industry-insiders, however, raise concerns on possible conflict of interest when the same group is present on both sides.

Dahiya defends the strategy. “These are two separate companies. There is no insurance specialist at PB health. All (that) the doctors are informed is that you have no targets. You’re getting a fixed salary and you have no targets whatsoever. You don’t have to achieve a particular revenue. You don’t have to achieve a certain number of operations,” he said, pointing to pressures that allegedly operate in the healthcare system, like converting out-patients to inpatients or targets for diagnostics, for example.

Expanding into hospitals, when the discussion centers on price control of healthcare services, Dahiya said, the method of incentivisation needed change - by extending funds to hospitals to treat anyone who goes there, for example, rather than supporting certain listed specializations – which could then skew services in that direction.

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