Physical rehab fast emerging as lucrative biz proposition in India

Physical rehab is fast emerging as a lucrative business proposition in India. Consider how WHO defines rehab. According to WHO, it is a set of interventions designed to optimize functioning and reduce disability in individuals with health conditions in interaction with their environment. The growth prospect of physical rehab or rehab tech in India is indicated by the healthy gross margins of rehab providers and impressive consumer lifetime value across the major segments. Rehab is rapidly evolving and today transition care centers and out of hospital care providers can address a wide range of patient requirements from basic to complex or critical care. Rehab tech providers are adopting digital and virtual care technologies and integrating these with physical care set ups to provide high quality services in this space. Physical rehab in India, which is estimated to be a $17 billion market at present, is expected to grow at a CAGR of 15.5 per cent in the next five years to reach 35 billion by FY2028.

The physical rehab market in India comprises three major segments 1) Restorative care (nearly $5 billion market): recovery from critical health conditions, mostly after a complex surgery or procedure 2) Geriatric care (nearly $5 billion market): medical care to optimize functioning in elderly people, covering both services and products and 3) Pain Relief ($ 3-4 billion market): physiotherapy-led care in non-critical conditions such as arthritis, injuries and lifestyle related pains.

And now just to give an example, going by a recent study by Redseer Strategy Consultants , in case of restorative rehab (which is nearly 28 per cent of the market), a consumer typically uses it once in a lifetime, but spends $650-700 (nearly Rs 50k) for a rehab treatment lasting 12 days. Further, the restorative rehab provider makes 50-55 per cent gross margins of this spend by consumers.

Going by the Redseer study, 35-40 per cent of the physical rehab spend in India is concentrated in the top-10 cities. This market is projected to grow at a CAGR of 15.5 per cent in the next five years to reach $35 billion by FY28, primarily led by the increase in rehab adoption – lack of awareness, sparse availability and limited capabilities of rehab providers are currently restricting the usage of rehab, despite the strong need in certain health conditions.

Interestingly, at present, majority of rehab is provided by hospitals and local unorganized players - hospitals dominate the critical restorative rehab segment and local providers lead the non-critical geriatric and pain-relief segments. However, both of them aren't able to aptly serve the consumer needs. Despite providing a standard service, consumers find rehab at hospitals to be expensive and lacking a recovery-focused environment. And, while local players are more affordable, they lack the basic quality and professionalism in service and have limited ability to address complex situations. This has created a strong need for specialized players in the rehab market, who solve these problems, enabled by a clear focus on creating high quality outcomes for consumers.

Rehab tech providers, on their parts, are adopting digital and virtual care technologies and integrating these with physical care set ups to provide high quality services in this space. And interestingly, believe it or not, elderly people are consuming more technology, are using tech devices, buying online, and want more safety, more healthcare, and more engagement than ever before.