Affordability Revisited

Two postings ago (October 14), I noted that Cipla, the billion-dollar Indian generic pharma company, is developing affordable versions of biological anti-cancer drugs and that it likely assumes there will be some type of scheme to pay for the drugs.  [Sidebar:  Pfizer closed a multimillion dollar deal for diabetes bio-similars last week with another Indian company, Biocon (WSJ article).]  I then wrote about micro-insurance provided through governments, NGOs, and companies as one scheme for the delivery of affordable health care.  Not surprisingly when I did additional research, I found many, almost overwhelming, sources and viewpoints on this topic.  To start this revisit of affordable health care, I extracted a few (clearly debatable) points.

First, most of the world’s poor live several days’ walk from a public sector (government- or NGO-run) clinic or hospital and typically rely on self-diagnosis and medication purchased from a local vendor or on a local private practitioner, either credentialed or not (i.e., a traditional healer).  Second, most of the aid money donated for health care has gone to pubic sector agents, primarily governments, and not to private (for-profit) sector providers.  Third, the effectiveness, as measured in terms of people actually treated or other outcomes, has not been well-studied by the donor or recipient organizations, and when it has, has been found wanting.  For a well-reasoned summary of this perspective, I refer to a 2008 report by Philip Stevens of the International Policy Network (2008 IPN Report).  The report noted health care aid has increased as portion of overall aid since 2000 to a total of about $14 billion in the last year studied, 2006, but that, by the WHO’s own accounting, progress toward meeting the heath-related Millennium Development Goals has been lacking (2009 WHO Lancet article).

What has been tried and what may be done in improving the delivery of heath care in needy countries?  Turning to Mr. Stevens and the IPN again, I found his recent report, “Delivering medicines for chronic diseases in low-income countries:  Lessons from the response to HIV/AIDS” (2010 IPN Report), to be informative.  In it, the author summaries the literature on governments’ and aid organizations’ use of the private sector to deliver health care as a possible alternative to addressing current and  projected need.  Here is my (brief) synopsis of the described alternatives:

Franchising: “in which different independent health providers are commissioned to provide services under an established, unifying brand at specified prices and standards;” there are some examples of success, but high start-up costs and the difficulty of offering a wide range of services at a low price limit this approach for low-income groups.

Performance-based contracting:  in which “ministries of health contract private sector operators and NGOs to deliver defined and measurable services to local populations;” several countries have used this approach, the most successful being Cambodia since 1999, and, if done with transparency and strong evaluation mechanisms, is promising.

Public-private partnerships:  in which for-profit companies contribute money and expertise to a care delivery project; many examples in  HIV treatment are given; the most successful, but expensive (more than $100 million), to date has been in Botswana involving the government, Gates Foundation, and Merck Co.; the country was the first to  provide free HIV care to all its citizens.

Workplace treatment:  this approach harkens back to cradle-to-grave services provided by the early industrial age corporations and has several examples of success, primarily in south Africa with its large number of multinational companies and in HIV treatment with its unfortunately high prevalence and devastating effects.

Traditional healers:  although many people receive the majority of their care from this source, the few studies that have been done indicate a lack of trust or interest by the healers in adopting, non-traditional, evidence-based treatments.

Health equity funds:  are government- or donor-subsidized, but independently managed, programs that act as a health insurer for qualified, low-income participants; again Cambodia leads in trying these and had 26 funds operational in 2006; drawbacks include the need for substantial subsidy and experienced management.

Microfinance:  many examples exist in which small-scale lending is used by private health care providers to improve their services.

Community health insurance:  are like health equity funds but require some level of premium payment; there are successful programs in  Africa but they have suffered from fluctuating participation and lack of regulation.

Private health insurance:  the report only mentions the role of private insurance in providing HIV treatment and care in southern Africa where several attempts by companies have had mixed results (he cites  Feeley et al. 2007) but also notes that insurers in Ghana and Namibia are offering HIV/AIDS coverage.

So lots of examples of alternatives to the current (and not effective) donor-to-government-to-public provider system exist, but there are no obvious solutions.  Is there a solution to finding solution, or at least best practices?  Possibly, when I remembered my posting of September 7, 2010 (“Market Tested but Not Yet Approved”) in which I wrote about the Center for Health Market Innovations (CHMI), a Gates- and Rockefeller-funded program that is administered by a Washington, DC-based international development consulting firm called Results for Development Institute.  CHMI is building a database of programs that are operating through out the world to improve health care in low-resourced regions and gives details on each (there are about 400 now) and data on their performance.  My comment then was “so far, so good” with the caveat that they need to beef up their performance evaluation process for the database to be really useful.  And to which I can now add, CHMI’s mission of finding solutions to affordable health care delivery will be helped if it includes the programs cited by Stevens (his report includes reviews of 24 of the studies he cites) to the database, too.


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