Forum Institutional

Three steps for transforming healthcare

There is great opportunity for aligning business objectives with societal challenges


Ronald de Jong
Founder & Chairman, Philips Foundation
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Future of Global Health and Healthcare

As part of society, all of us – including companies – have an obligation to contribute to the positive state of the world. That is why we at Philips have set ourselves the target of improving 3 billion lives a year by 2025 and of making the world more healthy and sustainable through meaningful innovation. In this context, we embraced the sustainable development goals (SDGs) and are playing our part to help realize them. One of the SDGs that we are especially passionate about is SDG #3, to “ensure healthy lives and promote wellbeing for all at all ages”. This is a challenge in mature economies, but even more so in emerging economies where access to quality, affordable healthcare is not a given.

While many emerging economies have made improvements in the delivery of healthcare, we are convinced that to achieve universal healthcare, we need a radical transformation of health systems. Due to the complexity of health systems, it is paramount that all transformations are done in partnership and are grounded in innovation along the entire continuum of health. We have found that there are three critical ingredients to ensure the implementation of this goal:

1. Putting in place new business models based on shared values.

2. Developing new and sustainable financing mechanisms for healthcare.

3. Investing in local-for-local innovation.

Let’s take a closer look at each of those points.

Creative thinking needed

There is great opportunity for aligning business objectives with societal challenges and to create business solutions that generate both financial and lasting social impact. For example, achieving healthy lives for all is a major global challenge that needs to be addressed, but one that’s not insurmountable. Strengthening healthcare must start with primary healthcare for people in individual communities. Creating new ways of delivering care where it’s needed will build stronger and more resilient communities and make healthcare much more accessible and affordable to people at the right point of time. It also reduces the burden on emergency and acute care – which is a persistent challenge in all health systems. We’re already seeing examples of what these future health systems might look like.

In 2014, Philips opened its first Community Life Center in Kenya, a country with one of the highest maternal death rates in the world. Local stakeholders, first and foremost the people in the community, health workers, government at national and local level, and humanitarian partners, were involved in the entire development process to encourage community ownership. By renting out space for commercial services, the facility generates a revenue, contributing to its financial sustainability. In less than one year, 4,000 people a month – many of them pregnant women and children – have sought care at the facility, up from 1,000 a month.

Innovating healthcare funding

In countries like Kenya, huge investments are needed to create systems that meet healthcare needs and recognize the economic value of health for all, while making healthcare affordable. Such significant investments need new approaches to financing. And it’s vital that we in the private sector are also able to personalize our approach, so that the solutions we offer are tailored to meet the different challenges faced by communities. That could be through public-private partnerships, outcome or performance-based financing, innovative risk pooling schemes, or healthcare saving methods for people on the fringes or outside healthcare systems.

As healthcare innovation providers, we want to work closer with governments, donors and financing institutions to understand how we can best deliver quality services to the people that need them. We should continue to explore how to support governments and community-based humanitarian organizations to develop shared-value business models that leverage grant money from donors and combine domestic and private resources, where available, to improve the delivery of healthcare. Importantly, when thinking about blended financing, we must always operate in full transparency and accountability, with the end goal in mind: to deliver improved healthcare.

Why it pays to invest at the local level

Today’s mobile and connected technologies will help entire healthcare systems leapfrog past their current state and greatly expand access to care. Moreover, investing in local-for-local innovation has the added benefit of developing local talent and the economy at the same time. It’s important that governments lay the grounds for supporting local innovators and provide a marketplace that implements the best innovations at scale.

Philips is supporting local innovators and labs in Kenya and India, as well as testing proof-of-concept innovations in many more countries to compound and sustain the benefit of local-for-local innovation.

Together with universities and entrepreneurs, and in partnership with government and humanitarian organizations, we’re delivering smartphone-based telehealth solutions for midwives to monitor at-risk pregnant women in Indonesia, scaling technology that can help detect pneumonia in children in India and Africa, as well as scaling innovations with UNICEF to support women and children in Africa.

We must do it together

We realize that partnerships are instrumental to implementing the new sustainable development agenda. The private sector will drive this momentum, because quality healthcare is good for people, the planet and business. But this is not about philanthropy – it’s about transforming healthcare’s business model in a way that will lead to shared value. Only then will the radical transformation become scalable.

The SDGs provide a clear compass, a shared agenda for improving the lives of people around the world, starting from people-focused needs. By rethinking the way we fund and deliver healthcare services, we can make this a success, and make the world healthier and more sustainable.

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