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Establishing an Effective Pricing Structure for Eye Care in Low-Income Countries

This guide explores how to establish a sustainable pricing structure for eye care institutions in low-income countries, focusing on the mission of the organization, community understanding, and service volumes. It highlights the importance of encouraging patient footfall and understanding income levels to set prices above costs while remaining affordable. With insights from India’s consumer market and patient willingness to pay, it provides a comprehensive overview of effective pricing strategies that promote financial health and quality service.

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Establishing an Effective Pricing Structure for Eye Care in Low-Income Countries

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  1. How to establish a pricing structure? Financing eye care institutions in poor countries Sasipriya K M Lions Aravind Institute of Community Ophthalmology, Madurai, India

  2. Pricing Structure: Underlying principle • Organisation’s Mission • Business model

  3. Pricing Structure: Considerations • Understanding the community • Service volumes • Encouraging greater footfalls in the hospital

  4. Understanding the income levels Above cost – market rates Pricing that would encourage patients to pay The bird of gold: The rise of India’s consumer market – May 2007, McKinsey Global Institute, p.12

  5. Willingness to pay: • Sample size: 1271 households (one person represented) • 96% of the patients were willing to undergo cataract surgery • 57% were willing to pay irrespective of availability of free surgeries • 31% were willing to pay if free surgeries were not available • Of these, 27.8% were willing to pay at Rs. 500 – 1000/- • 45% were willing to pay between Rs. 300 – 450/- Unpublished report: Household Willingness to Pay for cataract surgery in Rural India - MuralikrishnanRadhakrishnan, RengarajVenkatesh, Vijayakumar Valaguru & Kevin Frick

  6. Willingness to pay for phaco surgeries: an example from Aravind Theni Revenue per Surgery

  7. An example from hinterland Cataract surgeries:

  8. Consider 1,000 persons requiring cataract surgeryin a communityOn the basis of the economic profile…

  9. Cost of 1,000 Surgeries (Rs.1,500/surgery): 1,500,000 Surplus: 900,000

  10. Pricing strategy: is beyond hard money! • Quality of the services • Designing the services taking into account the “other costs” to the patients • Transparency • Standardisation • Utilisation of the resources

  11. Thank You Better pricing strategy = Service volumes + better quality + financial health!

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