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Globalization/International Trade and Implications on HRH: Supply, Demand and Migration

Globalization/International Trade and Implications on HRH: Supply, Demand and Migration. F. Marilyn E. Lorenzo RN,DrPH Professor College of Public Health, Institute of Health Policy and Development Studies, National Institutes of Health University of the Philippines, Manila.

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Globalization/International Trade and Implications on HRH: Supply, Demand and Migration

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  1. Globalization/International Trade and Implications on HRH: Supply, Demand and Migration F. Marilyn E. Lorenzo RN,DrPH Professor College of Public Health, Institute of Health Policy and Development Studies, National Institutes of Health University of the Philippines, Manila AAAH 1st Conference October 29,2006

  2. Presentation Outline • Why trade health services? • Philippine v Global Situation • Modes of trade • Implications of health services trade on HRH development • Current and proposed solutions AAAH 1st Conference October 29,2006

  3. Why Trade Health Services? AAAH 1st Conference October 29,2006

  4. In principle……. Exports and Imports of Health Services to generate revenues to generate jobs & income to upgrade hard & soft infrastructure *Expand scope of services *Improve quality *Provide efficient services AAAH 1st Conference October 29,2006

  5. Rising health care expenditures • Aging populations • Shortage of human resources in health care (e.g. doctors, nurses, aids) • High cost of medical services • Government financing of health care historically high • Government financing now being constrained by the above trends Global Health Situation Global health expenditure is US$3 trillion per year; Asia’s health care market: 77% of global market Developed Nations In US$B Source: Hong Kong Coalition of Service Industries The average Japanese visits the hospital 14.4 times per year, the highest in the world AAAH 1st Conference October 29,2006

  6. Global Health Situation Developing Nations Philippine Scenario 55% private financing 43% public financing (including social insurance) • Health care financing mostly • from private • Budget on health services • relatively small Relatively slow expansion & modernization programs, operations not viable • Providers lack financial resources • to upgrade Increasing migration of health professionals • BUT: • Large pool of trainable human • resources DOH budget – 1.6% of total budget on social, economic & other services (including finance charges) • Have advantage in tourism • Need additional fiscal resources • to fund higher health budget • requirement AAAH 1st Conference October 29,2006

  7. Modes of Trade AAAH 1st Conference October 29,2006

  8. The GATS Framework AAAH 1st Conference October 29,2006

  9. The GATS Framework AAAH 1st Conference October 29,2006

  10. Mode 2: Consumption Abroad Health Tourism Long Stay (Retiring Individuals & Active Retirees) Retirement (Immigrants & Retired Elderly) Assisted Living & Continuing Care “pull factor” Independent Living Communities Spa/Herbal/Natural Healing Medical Rehabilitation Diagnostics (e.g. second opinion, initial assessment) Non-invasive procedures (cosmetic, dermatology) Invasive procedures (replacement surgeries, cancer, etc) AAAH 1st Conference October 29,2006

  11. Major Drivers for Movement of Patients • Aging Populations • Shortage of Health Professionals • High Cost of Medical Services • Poor Health Facilities in home countries • Long waiting for • treatment & surgery AAAH 1st Conference October 29,2006

  12. Major Players in Asia Source: NTO wesbites AAAH 1st Conference October 29,2006

  13. The GATS Framework AAAH 1st Conference October 29,2006

  14. Mode 3: Commercial Presence • Options: • Philippine providers set up branches abroad (exports) • Philippines attract investments in medical zones or existing facilities (e.g Bumrungrad in Asian Hospital) – imports – and improve finances and enhance local linkages AAAH 1st Conference October 29,2006

  15. The GATS Framework AAAH 1st Conference October 29,2006

  16. Mode 4: Movement of Natural Persons • Shortage of Medical Professionals Abroad • Philippines is major exporter in this trade • Migration will still continue • Seek better market access and national treatment for our health professionals • Foreign medical professionals are allowed entry only under certain intra-company arrangements or contracts but not allowed to practice or establish commercial presence AAAH 1st Conference October 29,2006

  17. Summary of Risks/Trade-Offs AAAH 1st Conference October 29,2006 Source:Adam and Kinnon (1998)

  18. Exportable Health Services AAAH 1st Conference October 29,2006

  19. Health Services trade and HRH Development AAAH 1st Conference October 29,2006

  20. Major Issue: Human Resources Development Low Salaries of Medical Professionals Lack of Opportunities for Medical Professionals in the Country Low Budget on Health Expenditures *Exodus of Doctors and Nurses *Decline in Enrollment in Medicine *Rapid Increase in Enrollment in Nursing *Decline in Quality of Nursing Education Health Tourism Retirement Poor National Health Care System AAAH 1st Conference October 29,2006

  21. Deployment of Nurses (POEA,2005) AAAH 1st Conference October 29,2006

  22. Nurse Medics • Enrollment in nursing in NCR increased from 8,600 in 1998-99 to 34,277 in SY 2003-04 • Enrollment in medicine declined from 7,162 in SY 1998-99 to 6,551 in SY 2003-04 • Enrollment in medicine declined from 9,106 in SY 2002-03 to 6,551 in SY 2003-04 AAAH 1st Conference October 29,2006

  23. Deterioration of Quality (PRC,2006) AAAH 1st Conference October 29,2006

  24. Performance of Nursing Schools CHED NURSING SCHOOL REPORT CARD (CHED, 2005) AAAH 1st Conference October 29,2006

  25. Current and Proposed Solutions AAAH 1st Conference October 29,2006

  26. Major Goal In the exchange ensure Mutual Benefits! AAAH 1st Conference October 29,2006

  27. Government is supporting these initiatives…. Executive Order No. 372 NEDA MTPDP 2005-2010 DTI-Board of Investments 2005 Investments Priorities Plan PEZA Department of Health Department of Tourism • There’s need to coordinate and harmonize private and public sector initiatives. • Focus of private-public partnership (Cluster-based Approach): • Upgrading quality of hard and soft infrastructure • Work towards reaching international standards of health care delivery • Explore the potentials of the local market to upgrade quality AAAH 1st Conference October 29,2006

  28. Strategic Directions: HRH Master Plan • Human Resource Development • Increase health budget specifically on HRH Dev’t • To increase benefits allowable via social health insurance in order to increase demand for health care by 3 times • Strengthen capacity of Philhealth as an insurer • Access to funds by physicians particularly those in the provinces • Improve retention/return schemes: e.g. brain circulation • Encourage lifelong learning (building credentials): Career mgt. • Pursue proposals of NIH and PMA: • National Service Act • Creation of Commission on Health Human Resources Development (can be part of the overall national structure) AAAH 1st Conference October 29,2006

  29. Strategic Directions:HRHMP • Developing Firm Infrastructure • Need for database/inventory of facilities and business networks here and abroad • Accreditation of major hospitals with JCI • Access to financing via investment opportunities (e.g. joint ventures, management contracts) • Cluster-based Approach: Closer links among associations across health and related industries (e.g. medical, travel, IT, etc.), government and academe AAAH 1st Conference October 29,2006

  30. Options for Negotiations • Conduct multi-stakeholder meetings to discuss Philippine position in the GATS framework, regional arrangements, and bilateral arrangements specifically: • Identifying the benefits and costs in relation to health objectives • Implementation of exchange compensation schemes • Open up activities with significant inflows of capital that would enhance local linkages • Identifying options for allowing foreign medical practitioners and foreign investors and mutual recognition of licenses and standards AAAH 1st Conference October 29,2006

  31. Thank You ! Mabuhay! AAAH 1st Conference October 29,2006

  32. Major Drivers for Movement of Patients • Aging Populations in OECD In the year 2025, the proportion of those 65 and over will be highest in Japan, followed by Italy. Source: WB AAAH 1st Conference October 29,2006

  33. Country Extent of Shortage and Year Canada 78,0000 (2011) 113,000 (2016) Australia 31,000 (2006) 40,000 (2010) Major Drivers for Movement of Patients • Aging Populations • Shortage of Health Professionals Sources: AAAH 1st Conference October 29,2006

  34. Major Drivers for Movement of Patients Cost of Cardiac ByPass Surgery (in US$) • Aging Populations • Shortage of Health Professionals • High Cost of Medical Services Source: PATA;UA&P Cost of Comprehensive Male Examination Cost of Daily Hospitalization USA – US$1,742 Japan – US$800 Philippines – US$25-40 AAAH 1st Conference October 29,2006 Source: PATA; UA&P

  35. Major Drivers for Movement of Patients • Aging Populations • Shortage of Health Professionals • High Cost of Medical Services • Poor Health Facilities in home countries • Citizens of Micronesian States • and other Southeast Asian countries • such as Indonesia take advantage of • the cheaper cost of services and • better quality of facilities • in developing countries like Thailand, • Philippines, India AAAH 1st Conference October 29,2006

  36. Need for Strategic Directions • Lack of framework on the development of the health services sector • Absence of unified body to address local health sector and trade concerns • Lack of human resources development plan in relation to the needs of the local population and trade potentials • Absence of roadmap on exportable health services • Lack of inventory of health care providers/health professionals • Lack of discussions on the implications of the GATS among doctors, nurses or students and how to address possible risks • Lack of statistics on the contributions of other modes of health services trade(e.g. health tourism) BUT – private sector initiatives are existing AAAH 1st Conference October 29,2006

  37. Strategic Directions • Institutional Structure • Foster private sector initiatives • Government to support or enable rather than increase intervention • Public-private mix to optimize scarce resources and create forum for public discussions • Clearly define the national structure (from the existing inter-agency groups) to address development of health services and trade in health services (e.g human resource development, coordination among stakeholders, development of common vision and targets) • London Medicine • Australia’s National Health Industry Development Forum • Singapore Medicine • Malaysia’s 5-Committees • Establishment of an incentive structure targeted at specific services such as health tourism and designed to attract capital flows and enhance local linkages (already initiated by BOI) AAAH 1st Conference October 29,2006

  38. Need for Strategic Directions • Domestic Policies • Foreign Direct Investment • Policies to ensure universal access (Let’s not ignore domestic market potentials) • Regulatory Policy on Standards and Accreditation • International Policies • Work on insurance portability • Recognition of hospital and professional standards AAAH 1st Conference October 29,2006

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