This article is published in collaboration with GE LookAhead.
The need to improve the quality of and access to affordable healthcare in emerging markets is pronounced. Nearly three out of four chronic diseases occur in low and middle-income countries, according to the World Health Organization (WHO), and the rise of the middle class in emerging markets will only add to the pressure.
Developing countries are acutely aware of the challenges this represents for their economies, but face a series of challenges to delivering universal healthcare to their 5.8bn citizens. One is financing. Public risk-sharing and insurance coverage mechanisms, for instance, tend to be paid for through taxes and worker salaries, making them largely inaccessible to the 60-70% of those in emerging market countries who work outside the formal economy. In addition, the rise of chronic diseases — India now has the largest number of diabetics in the world, with China in second place — is forcing a rethinking of how the existing healthcare asset base, initially designed to deal with acute care, should be used. Lack of preventive care and little chronic disease management, meanwhile, lead to sicker patients, resulting in more expensive care and adding pressure to the financial side of the equation.
One solution to breaking out of this negative cycle is to design systems around patients and bring care closer to them — as opposed to their going to the hospital to get it. Implementing such systems requires training. The Social Health Activist programme in India, for instance, has trained nearly 1m community health workers. Another requirement will be to enable patients to self-monitor. “[Putting] the patient in the centre provides a 360-degree perspective on how care and support work in the health system,” says Mario Gutierrez, executive director for the Center of Connected Health Policy. “It requires a whole rethinking of how care is provided, in which the doctor is part of the team, not the centre.”
Digital healthcare will have a critical role to play. China, which invested $3bn in the sector in 2014 (expected to grow to $110bn by 2020), is among those nations that are exploring the role of digital care across the healthcare value chain. Baidu, China’s famous search engine, now enables online booking of appointments, for instance, while social media player Tencent is extending its chat and payment services to the healthcare sector. This year also saw the arrival of China’s first “cloud hospital” in Ningo, featuring cloud computing, big data and the Internet of Things. The hospital, launched in March, will act as a platform connecting local health centres, specialists, hospitals, pharmacies and insurance providers. Whether the project manages to gather the critical mass of actors needed to deliver at scale remains to be seen. Nonetheless, we are likely to continue to see such healthcare initiatives.
Another important area of action will be to eliminate the inefficiencies of healthcare financing, which account for 20-40% of total healthcare spending, according to WHO. Value-based care and contracting, where reimbursement is based on value produced and overall population health, could help address some of this waste, for example, by reducing unnecessary tests and procedures. Such reduction would ultimately result in less-expensive coverage. As for drugs, value-based price controls, while controversial, might also increase the incentive for life-science companies to develop cheaper diagnostics and treatment technologies .
Establishing patient-centred and value-based care in emerging markets in time to cater to the rising middle class is not a task governments can undertake on their own, however; public-private partnerships (PPPs) will be an important part of such efforts. But with most healthcare PPPs currently focused on urban areas, ensuring that PPPs do not widen urban-rural inequalities will require finding profitable healthcare solutions that can also serve the poorest.
Impact funds like the $200m Global Innovation Fund — launched last year and c0-financed by Omidyar Network and the development agencies of the US, UK, Sweden and Australia — take a venture capital approach to this problem. Companies already active in these markets are leveraging their expertise and networks to design solutions tailored to local markets. Last September, for instance, GE announced the creation of a new business unit called Sustainable Healthcare Solutions (SHS) specifically targeted at the 5.8bn people living in emerging healthcare markets like India and South Asia, Africa and Southeast Asia. In addition to distributing existing products like its portable ultrasound device or portable electrocardiographs, GE will invest $300 million into SHS to develop a portfolio of affordable healthcare technologies, using a frugal-innovation approach. Other solutions, some already deployed in Kenya and Algeria, might also include contract structures combining the leasing of imaging infrastructure with capacity-building efforts.
Clearly, when it comes to healthcare, most emerging markets will face an uphill climb. But the efforts will be worth it. Bringing quality healthcare to those who cannot access or afford the current options won’t just save money, it will also save lives.
Publication does not imply endorsement of views by the World Economic Forum.
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Author: Elizabeth Armstrong Moore is a writer at GE LookAhead.
Image: A nurse poses for a photo in a trauma center. REUTERS/Jonathan Bachman.