Quality HealthCare Asia
- HKGCC Membership No. :
- HKQ0025
Quality HealthCare Asia
Brian O'Connor remembers the day that Quality HealthCare Asia was founded like it was yesterday. "That was the week of the handover," the entrepreneur recollected, "and for five days and nights it just never stopped raining."
The rain only added to the gloom and uncertainty that hung over Hong Kong at the time, which grew as the Asian financial crisis started to bite. But Mr O'Connor said he never for one minute doubted his decision to his postpone retirement to found Quality HealthCare. He got the idea in 1996 after discovering that the healthcare market in Hong Kong was incredibly fragmented. If he could somehow corporatise and consolidate the industry, he would be able to create a vast healthcare provider network practically overnight.
"Because the other thing that struck me was that not only were there a lot of individual practitioners, but also a lot of dentists and physiotherapists. No one group offered every service, yet that is the way the world has gone," he said. "People want one-stop shops."
Healthcare services had been consolidated in many countries, but for some reason the sector in Hong Kong had ignored the trend. Part of the reason was perhaps due to the long-standing traditions within the health industry, and any attempt to change the status quo would inevitably run into opposition. The industry was also doing relatively well, so if everything was fine, why try to fix it?
"But everything was not fine," Mr O'Connor said. Corporations wanted their employees to be offered a wide range of services and coverage, and they wanted a single point of contact with a company offering the healthcare package. "They were fed up of having to deal with different individuals for different needs," he said.
He was able to get his dream off the ground during the week of the handover after striking a deal to buy Ultronics International Holdings Limited, a listed medical company selling ultrasound equipment. The company's name was then changed to Quality HealthCare in January 1998. The takeover allowed him to tap the capital markets and raise the profile of Quality HealthCare by becoming the first-ever listed healthcare provider on the Stock Exchange of Hong Kong.
In 1998 Mr O'Connor bought Drs Anderson & Partners to enable Quality HealthCare to expand its network of clinics. Founded in 1868, the takeover of the oldest medical practice in Hong Kong by a non-doctor caused unrest within the practice.
Mr O'Connor and his partners went to the doctors and convinced them that if they went after the bigger accounts, they would be able to capture a substantial part of the healthcare business, and at the same time offer their clients a wider range of services. To do that, however, would require substantial investments in their back- office operations to deal with corporate accounts, the insurance companies and all the paperwork associated with that.
The doctors did not know how to do that, nor did they really want to do it and they especially did not want to invest the money. Realising that commercial circumstances were sooner or later going to force them to do that, they agreed the work with Quality HealthCare.
"I was able to persuade the medical practices and the doctors not so much to sell out, but rather to sell in," he said.
The doctors were in, but they insisted that Quality HealthCare did not make the same mistakes as those made by healthcare providers in the United States, which was that executives of healthcare services interfered with the doctor-patient relationship to try and maximise profits. Mr O'Connor willingly agreed.
"We set up our Medical Standards and Compliance Committee, made up entirely of doctors -- none of our management are on that committee and as far as I am concerned never will be. They run all the practices and decide on the hiring and firing of doctors, and are completely in charge of the doctor-patient relationship."
With all the necessary elements now in place, Mr O'Connor set about expanding Quality HealthCare's network. The company created a listed company, ehealthcareasia (EHA), in 2000 to develop a software system to drive forward Quality HealthCare and expand its infrastructure. After spending a significant amount of money trying to make that work, the dot-com bubble burst and Quality HealthCare decided to stop all cash outflow from the company. It also slashed its workforce from 260 at its peak to 27, most of whom worked at its branches in Singapore, Taiwan and Australia. The drastic cuts saved the company and by December last year it had achieved cash-break even.
"One of the things I've learned in business over many years, is that if you make a decision you have to be very careful not to be so wedded to that, so hung up in it; whether from an ego point of view or you don't want to admit a mistake was make or whatever. That is the most disastrous thing you can do," he said. "You have got to sit back and think where is the real world?"
The software system that EHA developed for its parent company has been brought into Quality HealthCare, and now helps the company and its doctors manage the paperwork that the 150,000 patent consultations generate every month. Mr O'Connor said he has received interest to buy EHA and is in discussions to sell it.
After some teething problems, the software is now up and running. Besides speeding up the checking-in process at clinics, it also allows clinics to see instantly what treatments a patient is entitled to under their company's healthcare plan, which differ from employee to employee. The doctor can also see on his monitor who the next patient is, and have their medical records on screen.
The company is also continually expanding its range of services and treatments that it offers to its clients, and is now planning to offer eye and skin laser treatments, as well as anti-ageing treatments. "We have received a lot of requests from our customers that they want QHC to offer some of these services because they trust our name," he said.
Although insurance companies will not cover such treatments, Mr O'Connor said with the increasing number of people interested in undergoing such treatments with a name they can trust, people would be willing to pay for it themselves.
"Many thousands of people have had eye surgery done, and we will start to offer this service within two months," he said.
With QHC having basically achieved its mission of offering a broad range of medical services, with everything from Chinese medicine to soon-to-be eye laser surgery, where does it plan to go from here?
Mr O'Connor said he believes significant additional business opportunities exist in the additional insurance products coming onto the market, and the privatisation of the health care services. He is also looking at the Mainland market where healthcare reforms are moving much faster than in Hong Kong.
"People are demanding better service and are willing to pay for it," he said. "We plan to replicate in China the one-stop-shop that has been created in Hong Kong, and within the next six months, I think you can expect to hear us say we are in China."
