Stimulating Private Healthcare to Ensure the Right to Health


LONGMEADOW, Massachusetts — Many scholars, international bodies and citizens around the globe believe that health is a human right. Guaranteeing the delivery of health has proved to be a difficult task in modern society, yet the private sector may currently be a key asset needed to ensure the right to health.

Public avenues for equitable health access are not adequate in many communities. In India, public expenditures on healthcare have resulted in only 0.9 beds per 1,000 patients in the country, well below the 3.5 per 1,000 prescribed number of the World Health Organization. Despite increasing insurance coverage in Peru, one in four older Peruvian citizens does not have any insurance. These kinds of statistics are prevalent in many developing nations.

Emerging markets are not only attractive for car companies or the renewable energy industry, but healthcare companies as well. It is estimated that $25-$30 billion will be needed to meet the growing healthcare needs of sub-Saharan Africa alone, yet this large sum also represents an opportunity for business. For instance, GE Healthcare has invested millions in emerging markets in recent years, with annual sales reaching $18.3 billion in 2012. On a larger scale, 50 percent of health spending in developing countries is private expenditure, showing that the private sector is heavily used and already helps ensure the right to health.

Many foundational principles of investing apply to this new market. For instance, partnerships with NGOs or other organizations lead to more stable demand. Also, companies that are required by law to keep money overseas can use this to initiate a healthcare branch within an existing overseas subsidiary company and enter into the health market to diversify business interests.

With these opportunities come many important challenges to be aware of. Venturing into emerging markets involves new cultures, different societal norms, and figuring out the most effective methods to communicate with the population. Advertisements may not be as effective as community partnership, and regulations may prevent showing various products (i.e. pharmaceuticals or family planning products) in certain contexts. Finding the balance between a profit-driven price and having a product that will sell is an additional challenge in communities that do not have substantial financial resources.

A critical aspect of investing in the right to health within emerging markets is making sure that the products developed are catered toward the target audience. Stanford’s “Design for Extreme Affordability” program has been focused on supplying low-cost medical equipment to areas where it can be effectively utilized.

For instance, instead of supplying incubators (reliant on electricity) to communities that cannot use them, the team designed a sleeping-bag-like infant warmer that can be heated in hot water and maintain a 98-degree temperature for eight hours. It costs about $300, as opposed to $20,000 for an electric incubator, and can be shared within a community.

A team at the Massachusetts Institute of Technology (MIT) was on track to commence a production and distribution operation for biodegradable banana fiber sanitary pads for women but realized that creating the production and distribution team simultaneously would necessitate large factory-based investments. Instead, a local factory became the manufacturer to ensure sustainability, while a local NGO was charged with distribution to deliver the product.

Entering the healthcare market in developing countries is by no means a quick way to turn a large profit, but it is a way to effectively operate a business while collaborating with communities who desperately need partners on the journey toward attaining the right to health. With careful coordination and diligent research, the private sector will be able to change the face of health disparities across the world.

Patrick Tolosky

Photo: Flickr


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