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Medical Globalization by Dr David Quek


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Medical Globalization by Dr David Quek

  1. 1. Globalisation and Healthcare in Malaysia Dr David KL Quek, KMN MBBS (Mal), MRCP (UK), FRCP (London), FAMM (Malaysia), FASCC (ASEAN), FAPSC (Asia-Pacific), FCCP (USA), FACC (USA) MMA Selangor Symposium FUTURE CHALLENGES FOR HEALTHCARE FOR MALAYSIA, Sunway Resort Hotel & Spa Jan 18, 2009
  2. 2. Globalisation… UNDP 1997 <ul><li>Descriptive concept: used to describe the global proliferation of cross-border flows of trade, finance, & information; also refers to the emergence of a single, increasingly integrated global economy. </li></ul><ul><li>As prescription , usually calls for liberalization or deregulation of national markets in the belief that the unrestricted or free flow of trade, investments, and profits across national boundaries will facilitate global integration and produce the best economic, social, and political outcomes for humanity. </li></ul><ul><li>Outcomes or effects of globalization: usually equated with economic growth, increased personal incomes, improved living conditions and liberal democracy. </li></ul><ul><li>Globalization – in these terms – often prescribed with air of inevitability, moral superiority, & overwhelming conviction (UNDP 1997). </li></ul>UNITED NATIONS DEVELOPMENT PROGRAM (UNDP) 1997 “ Globalization—Poor Nations, Poor People.” Pp. 82-93 in Human Development Report 1997 . New York: Oxford University Press.
  3. 3. Free Market Capitalism… <ul><li>Key concepts: “free market” and “free trade,” </li></ul><ul><li>Advocates of this ideology use these concepts like a mantra. </li></ul><ul><li>Since 1989, belief in the triumph of capitalism over communism and the end to the Cold War are due to the victory of the market over the state (Korten 1999:37). </li></ul><ul><li>Belief that “the more you let market forces rule and the more you open your economy to free trade and competition, the more efficient and flourishing your economy will be” (Friedman 1999). </li></ul><ul><li>In this ideology, globalization = “spread of free market capitalism to virtually every corner of the world.” </li></ul><ul><li>Proponents believe they have discovered the universal formula for economic prosperity. </li></ul>
  4. 4. The Rise of Free Market Capitalism; The Demise of Socialism <ul><li>Globalism: 1 st introduced since 1970s </li></ul><ul><li>Free market capitalism expanded during the Reagan and Thatcher years, into the 1980s </li></ul><ul><li>Culminated with the fall of the Berlin Wall and the crumbling of the Soviet Union from 1989 </li></ul><ul><li>Usually touted as Capitalism’s triumph over Communism/Socialism </li></ul>
  5. 5. <ul><li>TURBO-CAPITALISM </li></ul><ul><li>Luttwak (1999): this capitalist formula is “good for every country, rich or poor.” </li></ul><ul><li>Formula: “PRIVATIZATION + DEREGULATION + GLOBALIZATION = TURBO-CAPITALISM = PROSPERITY”. </li></ul><ul><li>In applying this ideology, the IMF, the World Bank, the regional development banks, and the international development agencies of the major donor countries (led by the United States) have insisted that the governments receiving their loans, credits, and development assistance adopt a series of so-called structural adjustments and economic reforms. </li></ul>LUTTWAK, EDWARD 1999 Turbo-Capitalism: Winners and Losers in the Global Economy. New York: Harper- Collins
  6. 6. Globalisation Globalisation – a definition The intensification of global flows of capital, goods, ideas and people across borders and the institutions and rules established to regulate these flows.
  7. 7. Globalism and Unfettered Trade <ul><li>Globalism taken as the ultimate and inevitable pathway for economic theory—Free Trade supervenes every other consideration… </li></ul><ul><li>Borderless world (Keynes’ “Without passport or other formality”) , no barriers to investment, money flows, services, goods </li></ul><ul><li>National barriers such as regulations and cultural sensitivities, some deemed ‘protectionist’ are downgraded or removed entirely </li></ul><ul><li>“ Crucifixion economics” advocated, “no pain, no gain” top-down approach with capital reining supreme, corporations given widest berth to flourish with least restrictions, hardly any oversight; let the ‘moral right’ of the consumer take flight… </li></ul><ul><li>Is it an ‘experiment’ doomed to cyclical failure? </li></ul>
  8. 8. “ The power to become habituated to his surroundings is a marked characteristic of mankind. Very few of us realise with conviction the intensely unusual, unstable, complicated, unreliable, temporary nature of the economic organisation by which western Europe has lived for the last century. We assume some of the most peculiar and temporary of our late advantages as natural, permanent and to be depended on, and we lay our plans accordingly.” ~ John Maynard Keynes, 1919
  9. 9. The Promise of Globalisation <ul><li>Power of nation–state waning, maybe even dying </li></ul><ul><li>In future power lies with global markets </li></ul><ul><li>Economics, not politics or armies, will shape global markets </li></ul><ul><li>Global markets, freed from narrow nationals interests/ regulations, will establish international economic balances </li></ul><ul><li>Eternal boom-and-bust cycles will be outgrown </li></ul><ul><li>Markets unleash trade waves, tides of growth </li></ul><ul><li>Rising tide of growth will raise all prosperity for all, converting dictatorships into democracies </li></ul><ul><li>But new democracies will have no absolute powers—irresponsible nationalism, racism, political violence will shrivel away </li></ul>
  10. 10. The Promise of Globalisation <ul><li>New market sizes, larger corporations—raise beyond bankruptcy risks, hence market stability </li></ul><ul><li>Transnationals will be market leaders of civilisation—like virtual states, their aggressive dominance will make them impervious to local political prejudices </li></ul><ul><li>Thus conditions for healthy governance, emergence of debt-free governments </li></ul><ul><li>Stable public accounting in turn will stabilise societies </li></ul><ul><li>Theory: freed from wilful men, following individual self-interests will lead to life of prosperity, general happiness </li></ul><ul><li>Cycles of history will be broken; history will be dead! </li></ul><ul><li>But are all these true and inevitable? </li></ul><ul><li>Can individual self-interest lead to prosperity and general happiness for all, or only for some? </li></ul><ul><li>If so, what has history taught us so far? </li></ul><ul><li>Can Man be trusted to be ethical and follow a moral path, or will the path of greed for unquenchable money/wealth and overpowering self-interests, supersede all other concerns? </li></ul>
  11. 11. Recent Banking and Financial Crises put paid that globalism & unfettered free-market capitalism is anything but benign and self-regulatory…
  12. 12. UNITED NATIONS DEVELOPMENT PROGRAM (UNDP) 1997 “Globalization—Poor Nations, Poor People.” Pp. 82-93 in Human Development Report 1997. New York: Oxford University Press. 1999 Human Development Report 1999: Globalization with a Human Face. New York: Oxford University Press. Retrieved March 9, 2003 ( “ Money, gentlemen, money! The virus That infects mankind with every sickness We have a name for no greater scourge Than that!” ~ Sophocles
  13. 13. Health & Globalisation <ul><li>Global risks for health </li></ul><ul><li>Exclusion from global markets, e.g. North Korea, Zimbabwe, Cuba (converse results) </li></ul><ul><li>Private ownership of knowledge: TRIPS, drug patent laws, HIV drugs, </li></ul><ul><li>Migration of health professionals: mainly to wealthier nations, OECD, Australiasia, e.g. in one town in Canada, 2/3 doctors migrant from one small area of South Africa </li></ul><ul><li>Cross border transmission of disease: SARS, bird flu, NIPAH, MDR-TB </li></ul><ul><li>Environmental degradation: rise in dengue, Nipah, SARS, West Nile disease, Chikungunya; floods, tsunami, forest fires, tropical storms </li></ul><ul><li>Conflict: War, refugees, famine e.g. cholera </li></ul>
  14. 14. Health & Globalisation <ul><li>Health in globalising world </li></ul><ul><li>Domestic action alone insufficient </li></ul><ul><li>Health achievements critical to international development goals </li></ul>
  15. 15. Health & Globalisation <ul><li>Global opportunities for health </li></ul><ul><li>Inclusion/ connection </li></ul><ul><li>New market incentives for R&D </li></ul><ul><li>New resources for effective interventions </li></ul><ul><li>Knowledge dissemination </li></ul><ul><li>New rules to control cross border risks </li></ul>
  16. 16. Public health & Globalisation <ul><li>WHO’s response </li></ul><ul><li>Strategic directions; </li></ul><ul><li>Priority for: diseases of the poor, tobacco control/elimination; </li></ul><ul><li>Support for national health systems; </li></ul><ul><li>New: Partnerships and relationships; </li></ul><ul><li>Resources; </li></ul><ul><li>Rules; </li></ul><ul><li>Optimism. </li></ul>
  17. 19. Health & Globalisation <ul><li>Globalisation, trade and health A policy, research and training programme </li></ul><ul><li>Develop knowledge and skills </li></ul><ul><li>Promote policy coherence </li></ul><ul><li>Contribute to: global public goods for health, global health funds, international rules for health </li></ul>
  18. 20. Globalisation and health Openness Cross border flows technology Regional/global rules and institutions National Policies GCP/HSD June 2000 Health risks Health systems Level and distribution of household income Education Water Energy Transport Other sectors Health Outcomes
  19. 21. Health & Globalisation <ul><li>WTO (1995) Agreements and health </li></ul><ul><li>GATT </li></ul><ul><li>Technical barriers to trade </li></ul><ul><li>Intellectual property and trade : TRIPS </li></ul><ul><li>Services : GATS </li></ul><ul><li>AFTA ASEAN Free Trade Zone: 2013 </li></ul>
  20. 22. Health & Globalisation <ul><li>Globalisation and health: </li></ul><ul><li>policy measures </li></ul><ul><li>Equitable and sustainable growth </li></ul><ul><li>Openness: gradual, sequenced and paced </li></ul><ul><li>Produce global public goods, control the bad/illegal/unexpected </li></ul><ul><li>Increase transfer of financial and technical resources </li></ul><ul><li>Strong national health policies, institutions, regulations and programmes </li></ul><ul><li>Engage across sectors and borders </li></ul>
  21. 23. Structural Reforms & Adjustments for Globalisation <ul><li>These adjustments and reforms </li></ul><ul><ul><li>make the private sector the primary engine of these countries’ development efforts , </li></ul></ul><ul><ul><li>give priority to servicing their foreign debts, </li></ul></ul><ul><ul><li>deregulate their commercial and financial markets, </li></ul></ul><ul><ul><li>reduce the size of their government budgets and bureaucracies, </li></ul></ul><ul><ul><li>eliminate all barriers to foreign investments and imports , </li></ul></ul><ul><ul><li>sell off their state enterprises and public utilities to private corporations, e.g. attempts to sell off IJN to Sime Darby </li></ul></ul><ul><ul><li>privatize as many of their public services as possible, and </li></ul></ul><ul><ul><li>terminate all government subsidies and most welfare programs (Balasubramaniam2000). </li></ul></ul>BALASUBRAMANIAM, K. 2000 “Globalization and Liberalization of Healthcare Services: WTO and the General Agreement on Trade in Services.” Paper prepared for The People’s Health Assembly, December 4-8, Savar, Bangladesh. Retrieved December 9, 2002 ( ).
  22. 24. STIGLITZ, JOSEPH 2002 Globalization and its Discontents. New York: W.W. Norton. <ul><li>Joseph Stiglitz (2002), (2001 Nobel Prize in Economics and former Chief Economist and Senior Vice President of the World Bank) in his recent book on globalization, provides a harsh indictment on the disastrous effects on the structural adjustment programs and neoliberal development strategies of the IMF, the World Bank, and the WTO. </li></ul><ul><li>Stiglitz claims that what he learned while he was at the World Bank “radically changed [his] views of both globalization and development,” because he “ saw firsthand the devastating effect that globalization can have on developing countries and especially the poor within these countries” </li></ul><ul><li>The neoliberal policies that the IMF and the other international financial and trade agencies have imposed on these countries have been “ an almost certain recipe for job destruction and unemployment creation at the expense of the poor,” and they have contributed to the instability of their economies </li></ul>
  23. 25. HILARY, JOHN 2001 “The World Bank’s Private Sector Review: Does the Private Sector Development Strategy Threaten Children’s Right to Health?” Save the Children Position Paper. Retrieved on March 15, 2003 ( <ul><li>The introduction of cost recovery programs in the health sector is now widely accepted to have been disastrous, forcing many families and their children into a “medical poverty trap” characterized by untreated illness and long term impoverishment. </li></ul><ul><li>Even the World Bank, while it continues to support user fees for health in national Poverty Reduction Strategy Papers , has acknowledged that they are responsible for denying poor families access to health care. (Hilary 2001) </li></ul>
  24. 26. Negative Consequences of Globalisation … Hilary, 2001 <ul><li>Many countries that have followed the World Bank’s private sector development strategy have experienced negative consequences: </li></ul><ul><li>(1) commercialization has led to increased inequality in access to health care; </li></ul><ul><li>(2) private investment tends to be concentrated in the more affluent areas and in profit-maximizing activities; </li></ul><ul><li>(3) health maintenance organizations and health insurance companies favor the healthy and wealthy; </li></ul><ul><li>(4) the private sector draws health personnel away from the public health system (causing a “brain drain”) and worsens the shortage of trained personnel in public health; </li></ul>
  25. 27. Negative Consequences of Globalisation … Hilary, 2001 <ul><li>(5) many conflicts of interest between the pursuit of commercial interests and public health goals have arisen; </li></ul><ul><li>(6) profit-motivated health care gives excessive focus to curative rather than preventive health measures; </li></ul><ul><li>(7) limited funds are often diverted toward nonpriority areas; </li></ul><ul><li>(8) privatization schemes have restricted the access of poor families to not only health but to water and sanitation; and </li></ul><ul><li>(9) rising prices in the health care system are often accompanied by a decline in the quality of service. </li></ul>
  26. 28. The United Nations Development Program (UNDP 2001) has offered the following observations on this situation: <ul><li>• The technology divide does not have to follow the income divide; throughout history, technology has been a powerful tool for human development and poverty reduction. </li></ul><ul><li>• Markets are powerful engines of technological progress, but they are not powerful enough to create and diffuse the technologies needed to eradicate poverty. </li></ul><ul><li>• Developing countries may gain especially high rewards from new technologies, but they also face especially severe challenges in managing the risks. </li></ul>
  27. 29. The United Nations Development Program (UNDP 2001) has offered the following observations on this situation: <ul><li>National policies—important though they be—will not be sufficient to compensate for global market failures. </li></ul><ul><li>New international initiatives and the fair use of global rules are needed to channel new technologies towards the most urgent needs of the world’s poor people. </li></ul><ul><li>The challenge is for the international community to act on these propositions, and to organize and finance more effectively than in the past the development and distribution of the new health-related technologies that are needed by the populations of the developing world “in the face of the growing pressures of globalization” </li></ul>
  28. 31. Driving forces, facilitating factors and constraints Technology political influences economy ideas global concerns GLOBALISATION World Markets National Economy, Politics & Society Health Related Sectors Population Level Health Influences Individual Health Risks Household Economy Health Care System HEALTH
  29. 32. GLOBALISATION Openness Cross-border flows Rules & Institutions Population-level Health Influences Health-related Factors World Markets Health Care System
  30. 33. Health Care System Regulation Inputs/costs financing organisation delivery Health service access Health service quality Health service price
  31. 35. Why the Need for a Common (ASEAN) Market? <ul><li>It is the creation of an economic association of sovereign states into a single trading market having little or no restriction of movement of individuals, capital, goods, and services among the partner states. </li></ul><ul><li>A Common Market further facilitates trade by lowering regulatory and tariff barriers. </li></ul>
  32. 36. Common Market: Advantages <ul><li>The advantages gained from a Common Market association are many: </li></ul><ul><li>It increases division of labour and productivity. </li></ul><ul><li>It allows and encourages freedom of movement for all the factors of production. </li></ul><ul><li>The factors of production will be more efficiently allocated. </li></ul><ul><li>It creates a greater competitive environment. </li></ul><ul><li>It generates economies of scale making goods cheaper. </li></ul><ul><li>There is greater availability and choice of products. </li></ul><ul><li>A larger market also encourages creation of new products </li></ul>
  33. 37. <ul><li>Medicine has evolved into a service industry catering to the medical needs of the community. </li></ul><ul><li>With new practices in the economic and labour market, and improved lifestyle and expectations of patients, the practice of medicine has seen two major changes in the medical care arena. </li></ul><ul><li>First, the privatization of health-care and second the role of third party players acting between patients and health-care providers. </li></ul><ul><li>Medical care and service is now regarded as a yet another commodity to be bought and sold in the market place. </li></ul>
  34. 38. Market-Orientated Health Care <ul><li>In market-orientated medical care, the patient is the customer and the medical care and service rendered by the doctor and hospital is the commodity and service traded in a demand and supply chain. </li></ul><ul><li>As a user and client, the patient’s main desire is to secure the best doctor, the best medicine, the best hospital facilities and the best attended and related personal care services. </li></ul><ul><li>And the patient hopes to purchase all these at the lowest possible medical cost . </li></ul><ul><li>3 Players: </li></ul><ul><li>the Patient/Citizen, </li></ul><ul><li>the Health Care Provider, and </li></ul><ul><li>the Health Care Purchaser. </li></ul><ul><li>3 Markets: </li></ul><ul><li>the Service, </li></ul><ul><li>the Expert, and </li></ul><ul><li>the Purchaser Markets. </li></ul>
  35. 39. Free market strives on competition <ul><li>Benefits of market-orientated medicine. </li></ul><ul><li>For example: </li></ul><ul><li>1) Being consumer orientated, it is patient-centred. The result is better health service where patients receive good value for money. </li></ul><ul><li>2) There will be shorter waiting time and the patient better informed. The end result is a satisfied customer . </li></ul><ul><li>3) Competition will encourage medical practice to be more vigilant, transparent and accountable. </li></ul><ul><li>4) Doctors are bound to practise evidence based medicine and hospitals strive to ensure and maintain recognised standard of care. </li></ul><ul><li>(An example of a recognised standard of care is for hospitals to be accredited to the Joint Commission International (JCI). </li></ul>
  36. 40. Anton Petter & Gudrun Eder. European Health Management Association (EHMA) Annual Conference in 2007, Lyon <ul><li>In practice, medicine does not behave like other kinds of commodity in market trading. </li></ul><ul><li>Some problems associated with market-orientated medicine that can cause market failure or less than perfect results/outcomes, in some instances: </li></ul><ul><li>1) There is asymmetry of information . The Patient may not necessarily be able to make the best decisions on the varied products and treatments that are available to them. Often, expert knowledge is required to make decisions on complex issues such as the type of treatment most appropriate to the illness, the standard of safety, the level of comfort and the health cost involved. </li></ul><ul><li>2) Market barriers created by Health Care Purchasers not only dictate the price but limit the types of product available to the Patients. </li></ul><ul><li>3) Principal-Agent problems surfaced as a result of the introduction of third party agents who act between the Health Care Provider and the Patient. </li></ul><ul><li>4) Moral hazard is always present when a decision has to be made between best available treatment and the balance sheet of the Health Care Provider. </li></ul><ul><li>5) Transaction cost involving additional marketing and administrative expenses has made health care less efficient . </li></ul><ul><li>6) Risk selection by choosing less complicated cases can ensure greater returns to the Health Care Provider. </li></ul>
  37. 41. AFTA: ASEAN Free Trade Area <ul><li>Malaysia’s trade policy is to pursue trade liberalisation through rule-based multilateral trading system under WTO </li></ul><ul><li>One important WTO principle is to eliminate duties and tariffs for all parties </li></ul><ul><li>Common Effective Tariff Scheme (CEPT) adopted by ASEAN-6 (Brunei, Indonesia, Malaysia, Philippines, Singapore, Thailand): </li></ul><ul><li>Reduced duties on 98.9% of all their products </li></ul><ul><li>99.6% of these products are at tariff rates 0 to 5% </li></ul>
  38. 42. In 1995, the ASEAN Economic Ministers agreed to the establishment of an ASEAN Common Market (AEC). <ul><li>Aim to allow continued growth and prosperity in the region, enabling the region to withstand global competition. </li></ul><ul><li>A framework of an ASEAN Common Market was set up to substantially eliminate barriers to trade and services; in Bali 2003, this AEC was targetted to be established by 2020 </li></ul><ul><li>In 2007, the Economic Ministers met in Cebu, Philippines and agreed to the following plan: - </li></ul><ul><li>1) Develop Asean into a single market </li></ul><ul><li>2) Eliminate tariffs and non-tariffs barriers </li></ul><ul><li>3) Free movement of professionals </li></ul><ul><li>4) Encourage private participation </li></ul><ul><li>5) Harmonise custom procedures </li></ul>
  39. 43. AFTA Mutual Recognition Arrangements: 2015 <ul><li>A common market will no doubt benefit the health-care services as it facilitates the movement of talents, capital, goods, and services across the region. </li></ul><ul><li>Steps were taken in 2004 in Vientiane, Laos during the ASEAN Summit to harmonise standards and regulations for health services. </li></ul><ul><li>The Economic Ministers further met in Bangkok early this year for further co-operation on trade in health services. A roadmap was drawn up for the integration of the health care sector by 2010. </li></ul><ul><li>In August 2008, the Ministers met again in Singapore to help the ASEAN partners move closer towards economic integration. </li></ul><ul><li>Three Mutual Recognition Arrangements (MRAs) in the accounting, medical and dental fields were signed by the ASEAN members as part of a bigger goal of realising a liberalised and integrated ASEAN economic community by 2015. </li></ul>
  40. 44. 10 th ASEAN Summit (20-24 Nov 2004) Ventiane: Priority Sectors for fast-tracking realisation of AEC <ul><li>Health Services: </li></ul><ul><li>Healthcare service: Hospital, medical, dental services </li></ul><ul><li>Social work services: nursing homes </li></ul><ul><li>Human helath activities </li></ul><ul><li>Veterinary services </li></ul><ul><li>Ancillary Healthcare services cover: </li></ul><ul><li>Manufacture of pharmaceutical products </li></ul><ul><li>Medical equipment and devices </li></ul><ul><li>Health insurance </li></ul><ul><li>R&D </li></ul><ul><li>Education and training of medical personnel </li></ul>
  41. 45. AFTA: Aims <ul><li>Health without frontiers: </li></ul><ul><ul><li>Access to affordable healthcare, (?) </li></ul></ul><ul><ul><li>impact of trade liberalization on health sector </li></ul></ul><ul><ul><li>Access to wider healthcare choices, opportunities, greater flow of trade and services exchange, overall economic growth stimulated—GDP increase—function of global prosperity? </li></ul></ul><ul><li>Formulate ASEAN food safety policy </li></ul><ul><li>Harmonisation of maximum residue limits for pesticides </li></ul>Sarjeet SS. Implications of AFTA for medical associations and the medical profession. MMA News, Dec 2008, Vol.38 (11): pgs 13-14.
  42. 46. The European Union (the EU) is the best example of a long established Common Market model. <ul><li>In the EU, the practice of a common market in health services has resulted in the following: - </li></ul><ul><li>1) Greater mobility of people from one member country to another to seek better and faster health care service. </li></ul><ul><li>2) Also greater mobility of doctors from one member country to another for training and practices. Little difficulty was encountered in the standardization of educational curriculum and training among the educational bodies. But there was much resistance from the professional licensing bodies of the various member countries. </li></ul><ul><li>3) Another feature was increased migration of doctors from member countries with lesser remuneration to member countries with higher remuneration. </li></ul><ul><li>4) The EU countries saw an increase in the number of private hospitals in member countries with lower labour cost. </li></ul><ul><li>5) The EU had encouraged more innovations of medical products, one of which was the invention and production of the Cypher Stents. </li></ul><ul><li>6) In the United Kingdom, there was an increase in complaints of long waiting lists and the poor service of the National Health Service when compared to some of the other EU countries. </li></ul>
  43. 47. <ul><li>3 Players: </li></ul><ul><li>the Patient/Citizen, </li></ul><ul><li>the Health Care Provider, and </li></ul><ul><li>the Health Care Purchaser. </li></ul><ul><li>3 Markets: </li></ul><ul><li>the Service, </li></ul><ul><li>the Expert, and </li></ul><ul><li>the Purchaser Markets. </li></ul>Market-Orientated Health Care
  44. 48. First Player of the Health Market - The Patients/Citizens <ul><li>a) The ASEAN population size and economics , a huge market potential consisting of 589 million people with GDP of 2.6 trillion US dollars. </li></ul><ul><li>However the economic characteristics vary greatly among the ASEAN member countries, ranging from a GDP of 710 US dollars per capita to 51,000 US dollars per capita. </li></ul><ul><li>b) Expect greater mobility of people among the ASEAN countries </li></ul><ul><li>— follows from waiver of visa among the ASEAN govts, </li></ul><ul><li>— introduction of budget air fares </li></ul><ul><li>— migration of workers among ASEAN member countries for better employment opportunities and greater remunerations. </li></ul>
  45. 49. <ul><li>c) With improved living standards and exposure to different lifestyles in the various ASEAN countries, healthcare expectation of patients is expected to rise . </li></ul><ul><li>Patients now have better knowledge and understanding on diseases, and the treatments available. </li></ul><ul><li>More importantly, patients are now presented with a wider range of treatment options available to them. </li></ul><ul><li>These options differ not just in terms of therapy offered, but in quality of care, and cost . At the same time, they have greater expectations of the service provided. </li></ul><ul><li>d) With improved living and educational standards of the people in ASEAN, the pattern of diseases also changes, more heart or chronic ailments. </li></ul>First Player of the Health Market - The Patients/Citizens
  46. 50. Second Player of the Health Market – The Health Care Providers <ul><li>a) Physicians: GPs and Specialists </li></ul><ul><li>In an ASEAN Common Market setup, we expect a greater mobility of doctors among the ASEAN countries . Doctors move from one country to another for training, consultation and better remuneration and job opportunities . </li></ul><ul><li>Government health authorities will/should meet to standardize the education curriculum and training of the medical practitioners, including that of specialists and surgeons, the various subspecialty bodies would have to help in giving relevant inputs and recommendations to the Government authorities. </li></ul><ul><li>There is a large variation in density of specialists in relation to population . Patients from areas with low density of specialists will seek treatment in places where the specialists are more accessible. </li></ul>
  47. 51. Second Player of the Health Market – The Health Care Providers <ul><li>b) The Hospitals. </li></ul><ul><li>1) Privatization over public ownership will be more common in market-orientated medicine. We expect increase in the number of private hospitals in the ASEAN countries. Presently with the exception of Cambodia and Laos, highly specialised care/surgery services are available in many of the private hospitals in the ASEAN countries. With greater mobility of health workers there may be a shift of private hospitals to countries with lower labour cost. </li></ul><ul><li>2) Private expected to bring in foreign exchange to member ASEAN. Medical tourism is greatly encouraged by the Governments of the Philippines, Thailand, Malaysia and Singapore. In the Philippines incentives such as tax relief are offered to encourage the development an construction of private hospitals. Indonesia too is building new, well equipped private hospitals for its well-to-do patients. </li></ul><ul><li>3) Another good outcome that can be expected will be hospitals striving to attain recognised standard of health care as a result of keen competition among the private hospitals. Many hospitals now seek accreditation from the Joint Commission International for quality management and health-care service. To-date, there are 21 private hospitals in the ASEAN member countries with JCI certification. </li></ul>
  48. 52. Second Player of the Health Market – The Health Care Providers <ul><li>b) The Hospitals. </li></ul><ul><li>4) Large growing market for health care will lead to segmentation of various kinds of private hospital catering to the different needs/sectors of patients. </li></ul><ul><li>Some private hospitals thrive on offering top-class quality medical care to patients who are able and willing to pay higher cost. E.g. Parkway Group Healthcare Pte Ltd is building a US 1.5 billion-dollar luxurious state-of-the-art hospital in Singapore. </li></ul><ul><li>5) With more private hospitals being set up, there will be an increase in job opportunities for the doctors and health-care workers , in the region with no border restraints. </li></ul><ul><li>6) A large market base will also enable some hospitals to go into more specialized disciplines and services for example, neonatal surgery and robotic surgery. </li></ul><ul><li>7) The market will also encourage greater innovations and use of new devices, for example, new biotech/genomic and stem cell therapy. </li></ul>
  49. 53. Third Player of the Health Market – The Health Care Purchaser <ul><li>1. Patients in public hospitals of all ASEAN countries are now receiving free or heavily subsidized medical treatments. Vietnam and Singapore have co-insurance payment by employers and employees so that more citizens can seek treatment in private hospitals. </li></ul><ul><li>2. Private health insurance coverage among ASEAN countries at present is still very low, ranging from 0 to 20%. </li></ul><ul><li> There is great opportunity for private investors to invest in this area; but would for-profit motives drive up health care costs? </li></ul><ul><li> The insurance planners can design and provide different health packages and market them according to the needs of the patient. </li></ul><ul><li> Insurance agencies can tailor and organise different kinds of health/medical packages for their clients. They range from budget to an exquisite care, from mass to private luxuries, etc. </li></ul><ul><li> Problem: what about the uninsured or those unable to insure? </li></ul><ul><li>3. Can emergence of insurance planners & international referring agencies help lower the cost of medical treatment? </li></ul><ul><li> May be tendency to dictate and limit the types of treatment available; case and risk selection worries are real… </li></ul>
  50. 54. ASEAN Common Market on Health Services: Benefit <ul><li>The most immediate benefits would likely be: </li></ul><ul><li>1. An ASEAN Common Market on Health Services will mean greater access to better quality healthcare to the people of ASEAN. </li></ul><ul><li>2. An ASEAN Common Market on Health Services encourages the setting up of specialised medical centres that focus on the use of sophisticated medical equipment and advance state of the art treatment; but cost is likely to escalate… </li></ul><ul><li>3. As the healthcare expectations of people increase, public hospitals will be motivated to improve , thereby further raising the general standard of health care in ASEAN. </li></ul><ul><li>4. Richer, more developed nations such as Singapore may benefit more than poorer countries such as Laos and Cambodia, as freer movement of its specialists or large physician or hospital groups (more established and experienced) can tap into the larger population of the wealthier citizens of other ASEAN nations. </li></ul>
  51. 55. <ul><li>1. Inequity/disparity of healthcare access is a real threat: The care treatment extended to the rich and the poor will vary; the very poor or uninsured/uninsurable will very likely be left out. </li></ul><ul><li>2. Outward migration of already short-staffed expertise: Easy mobility enhanced by attractive job opportunity and prospect may result in shortage of doctors in the outlying areas and poorer regions where patients desperately need specialised care. </li></ul><ul><li>3. Market forces may encourage popularisation of specialist treatments , interventional rather than simpler treatment strategies that are more profitable to the Health Care Providers. </li></ul><ul><li>4. Information Asymmetry and Difficult Patient Choices: Patients face difficulty in making informed choices in treatment arising from unequal relationship between the Patient and the Health Care Provider. </li></ul>ASEAN Common Market on Health Services: Challenges
  52. 56. AFTA/WTO: Current status of Liberalisation <ul><li>Legal Profession: only Malaysian citizens or permanent residents admitted to the Bar. Foreign lawyers can appear before Malaysian court with sepcial Admission certificates from AG’s office. Admission regulated under Legal Profession Act, slightly dfferent for Sabah/Sarawak </li></ul><ul><li>Medical Services: </li></ul><ul><ul><li>Right now, only recognised medical colleges and their graduates who must be citizens/permanent residents, allowed to practice in the country. </li></ul></ul><ul><ul><li>Foreigners allowed on temporary licenses depending on application from employing or contracting institutions; usually for medical post-graduate training/research, but still must be registered with MMC and given temporary or limited registrations; </li></ul></ul><ul><ul><li>Such registrations are not available for family or general practitioners, great difficulties even with foreign spouses of Malaysian citizens </li></ul></ul>
  53. 57. AFTA 2013/GATS/WTO <ul><li>What does this mean for Malaysia? </li></ul><ul><li>Beginning with ASEAN countries, there will be free exchange of good and services in the health care sector by 2013, and extended to WTO signatory members latest by 2015 </li></ul><ul><li>Hospital groups can set up in any ASEAN country, from any country, as long as they are set up based on local laws and regulations, as for any local/national group—no discriminatory regulations allowed (this includes no language discrimination) </li></ul><ul><li>It also includes multinational insurers, large GP groups, Physician Provider Organisations, other health maintenance organisations/MCOs </li></ul><ul><li>No specialist group will be exempted, and medical and specialist degrees will be recognised automatically as long as these degrees and training have been granted by the local medical boards/councils as acceptable for their own nationals. National licensing rules should be uniform for locals as for foreigners from ASEAN </li></ul><ul><li>Not sure if this means automatic recognition of every national medical degree in ASEAN—MMC is looking into this to see if this contravenes the AFTA charter vis-à-vis our Medical Act. </li></ul>
  54. 58. Will there be Flood of Migrant Medical Professionals into Malaysia? <ul><li>Possibly. 2 sources: </li></ul><ul><ul><li>one from many of our less developed (lower GDP) neighbouring countries who oversupply their medical professionals and whose income is still relatively low (economic professional migrants) </li></ul></ul><ul><ul><li>Another even from Singapore with their small population and more advanced systematic approach to healthcare, large number of highly skilled and trained experts; </li></ul></ul><ul><ul><li>Richer and large group practices may invade our shores with not just specialist hospitals, but possibly general practice consortia </li></ul></ul><ul><ul><li>Solo GP practices may become swallowed by these larger group practices, e.g. as already seen with the Qualitas group. </li></ul></ul><ul><li>Health maintenance organisations and insurers from abroad may also make entry into our shores to tap the growing number of middle class citizens who are more health-conscious as well as more informed for choices </li></ul><ul><li>What about our public health sector? Will these be corporatised? Privatised? Who will look after primary care practices and public health issues </li></ul><ul><li>What about the NHIS or National Health Insurance Scheme (SIKK)? Will this be permanently put on the back-burner, and if so, how can we improve our health care economics and plans? </li></ul>
  55. 59. Will AEC go the way of EU? <ul><li>ASEAN Secretary-General One Keng Meng: </li></ul><ul><li>“ The EU has a common currency. They have free movement of people. We don’t think SEA countries are ready to do this. </li></ul><ul><li>“ What we care seeing in ASEAN is more the movement of professional people, skilled people. We cannot be like the EU which allows free movement of people. </li></ul><ul><li>“ Many of our countries are still relatively insecure, and if you have complete free movement of people, you can see thousands more coming into a small country or thousands more going where the market is good. </li></ul><ul><li>“ The local population may not be ready to welcome the competition from the guy next door.” </li></ul><ul><li>Will Malaysians be so ready to welcome our ASEAN brethren? </li></ul><ul><li>Will our doctors be prepared for the challenges and competition? </li></ul>Source:
  56. 60. <ul><li>Malaysia scored above world average in 8 of the 10 economic freedoms: </li></ul><ul><li>fiscal freedom (83.0), </li></ul><ul><li>government size (81.4), </li></ul><ul><li>monetary freedom (79.9), </li></ul><ul><li>trade freedom (78.2), </li></ul><ul><li>labour freedom (71.5), </li></ul><ul><li>business freedom (70.8), </li></ul><ul><li>freedom from corruption (51.0), and </li></ul><ul><li>property rights (50.0) </li></ul><ul><li>2 economic freedoms that Malaysia fared below world average: </li></ul><ul><li>investment freedom (40.0) </li></ul><ul><li>financial freedom (40.0) </li></ul>Heritage Foundation ranking: Hong Kong, Singapore, Australia, Ireland, New Zealand, United States, Canada, Denmark, Switzerland United Kingdom
  57. 61. <ul><li>“ There is a canker corroding the soul of society. Economic rationalism: the all-pervasive nature of competition; anti-social behaviour in many aspects of life and across all levels of society; the unrestrained consumerism of a surging global population , together with the consequent deterioration of our natural environment; and the dizzying rate of escalating social and technological change are, for many people, signs of cultural disengagement illuminating industrialism’s final convulsions. These convulsions are reflected in increasing corruption, crime rates and levels of stress, soaring public investment costs, disenchantment with our institutions and a growing mistrust of authority.” </li></ul>Richard David Hames. Burying the 20 th Century, 1997, Business and Professional Publishing, Australia
  58. 62. People’s Health Movement
  59. 63. People’s Charter for Health
  60. 64. Health as a Human Right; Is a Human Right?
  61. 70. Health worker density – Global Discrepancy / Inequity
  62. 71. Health workers migrate toward richer countries; loss from poorer lower-income country esp. public sector
  63. 72. Migrant health workers from poorer nations usually drift toward richer nations
  64. 74. So, what do I feel about globalisation, AFTA, and health? <ul><li>I’m cautiously optimistic </li></ul><ul><li>I don’t favour unrestrained free trade which can impact significantly on weaker institutions and societies, often creating more pain and hardship </li></ul><ul><li>Globalisation is not inevitable or unstoppable, there are viable alternative models (not TINA i.e. ‘there is no alternative’) where trade/capital is not the centre of civilisational or human progress </li></ul><ul><li>Cultural, traditional and humane activities, local meaningful betterment of individuals or groups are perhaps a more desired goal </li></ul><ul><li>There might still be time enough to modify or help reshape the not invariable postures of free trade and globalisation excesses. </li></ul><ul><li>Do we all have a collective will to think and act differently? </li></ul>
  65. 75. Myths of Globalisation and the Free-trade Paradigm ~ Graham Dunkley (Free Trade—Myth, reality and alternatives, 2004, Zed Books <ul><li>3 false assumptions: </li></ul><ul><ul><li>Globalisation is now well advanced </li></ul></ul><ul><ul><li>It is inevitable and unstoppable </li></ul></ul><ul><ul><li>It is overwhelmingly good for virtually everybody </li></ul></ul><ul><li>Adverse impacts include: </li></ul><ul><ul><li>Integrative effects (homogenisation of legal or administrative practices) </li></ul></ul><ul><ul><li>Displacement effects (destruction of one culture by another) </li></ul></ul><ul><ul><li>Disruption effects (social or other dislocation) </li></ul></ul>
  66. 76. Myths of the Free-trade Paradigm ~ Graham Dunkley (Free Trade—Myth, reality and alternatives, 2004, Zed Books <ul><li>5 false assumptions: </li></ul><ul><ul><li>Trading is anciently integral to human nature </li></ul></ul><ul><ul><li>Free trade, free markets and private initiative are best for most exchange </li></ul></ul><ul><ul><li>‘ comparative advantage’ is the best basis for all goods and services </li></ul></ul><ul><ul><li>Trading and free trade have, on balance, overwhelmingly net positive benefits for all concerned </li></ul></ul><ul><ul><li>Amount of trading has gradually increased over time, indicating inevitable globalism </li></ul></ul>
  67. 77. 4 Alternative Models <ul><li>Free Market Economic Rationalist (Smith/Ricardo) approach </li></ul><ul><li>Market Interventionist (Keynes/Kaldor) approach </li></ul><ul><li>Human Development (Marx/Sen) approach </li></ul><ul><li>Community Sovereignty (Gandhi/Schumacher) approach </li></ul>
  68. 78. Human Development (Marx/Sen) approach <ul><li>Amartya Sen (Nobel laureate) accepts general market principles, current forms of globalisation, reasonably free trade and longer-term growth-oriented goods </li></ul><ul><li>But believe in ‘human capacity development’ i.e. capacity expansion which implies collective benefit provisions such as infrastructure, health, education, literacy, training, female employment, general social development; also people sustenances through collective security and market-derived income; some public redistribution which leads to social justice. </li></ul>
  69. 79. Gandhian Principles… <ul><li>Ahimsa (Non-violence) </li></ul><ul><li>Satyagraha (non-violent recitification of wrongs, restrained political action) </li></ul><ul><li>Sarvodarya (respect and justice for all) </li></ul><ul><li>Swadeshi (sovereignty and self-reliance for communities and nations) </li></ul><ul><li>Gandhi regarded & opposed rampant economic growth as morally corrupting, free trade as socially destructive and copying of the west as degrading... </li></ul><ul><li>He advocated national self-reliance and self-restraints to consumption (Satya Sai Baba’s “ceiling on desires”), simple technologies and lifestyles </li></ul>
  70. 80. Schumacher (1973) <ul><li>Heavily influenced by Gandhi, Buddhist precept of “right livelihood” </li></ul><ul><li>Individuals should do what is morally right and environmentally requisite </li></ul><ul><li>Economic policies should be ethical, ecological, people-centred and spiritual </li></ul><ul><li>Appropriate and intermediate technology and development, without creating too much unnecessary mobility, structural instability, community decay and general ‘footlooseness’ </li></ul>