Equity and Innovation: What we should learn from the development of healthcare systems in BRICS economies

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As hundreds of millions of citizens in the BRICS economies are dragged out of poverty and into the middle classes, they begin to have higher expectations of their governments, and particularly of the healthcare system provided. This has meant that in Brazil, Russia and China, governments have embarked upon large-scale programmes of reform in order to establish comprehensive welfare systems typical of developed Western nations. In Brazil, healthcare recently topped the economy as the number one concern of voters. Presidential candidates responded by pledging wide reforms to their version of the NHS, the SUS. [1] In China, the coverage of the Government’s rural health-insurance scheme has increased from 3% of the eligible population to 97.5% in under a decade. [2]

Yet in seeking to provide healthcare to diverse and dispersed populations, these countries have begun to realise the same problems that have dogged the NHS for the past two or three decades. Firstly, demographic challenges make long-term spending commitments daunting as ageing populations rely increasingly on state care. This threat is particularly noticeable in China, where the ratio of workers to the elderly is currently five to one but is set to plummet to two to one by 2035. [3] Health inequalities across populations are also beginning to become apparent. When life expectancy across the London Borough of Enfield can differ by up to 12 years depending on where you are born despite access to the same healthcare services, geographically vast countries will struggle to ensure all citizens get equal care. [4]

These large systems also typically lack efficiency and it is here that the NHS offers the starkest warning of all. The Labour MP Margaret Hodge, speaking at the launch of a House of Commons report into NHS efficiency, stated that ‘Over the last ten years, the productivity of NHS hospitals has been in almost continuous decline.’ [5] When developing countries like Indonesia have pledged to provide health insurance to all of the country’s 240 million citizens by 2014, productivity is not something they can afford to sacrifice. [6]

What these pressures and challenges lead to is ever-rising costs – as one Brazilian commentator describes, the country ‘has a first-world rate of government spending but third-world public services’. [7] New Labour made the mistake of just meeting these costs and pumping money into the NHS as opposed to seriously looking at the way it operates. BRICS governments are all too aware of the problems of large Government budget deficits, and are not making the same error.

Most of the BRICS countries are rightly sticking to the principles of health services accessible for all, regardless of income. Where systems don’t go this far, they are at the very least laying out a safety net for those most in need. Rightly too, the British public demands that the NHS sticks doggedly to this principle, with many basing their vote on which politicians they trust with the NHS. So in order to defend this principle without creating unfunded spending commitments, governments need to reform how they deliver healthcare. As in so many other areas, this is where the BRICS look set to leapfrog the West, and particularly the UK, through two key areas of innovation.

The first is technology. Developing nations are beginning to use modern technology, domestically developed, to cut costs while retaining good outcomes for patients. It is here that India is taking the lead, through what commentators call “Jugaad Innovation” (jugaad is a Hindi word meaning a clever improvisation). [8] Using new technology, Indian engineers working for an American company managed to condense a 15 lb. electrocardiograph machine that cost $5.4 million into a handheld portable device that cost 60% as much. [9] The application of this new frugal thinking is potentially explosive for the way doctors diagnose and treat their patients. Yet the NHS failed to introduce something as relatively basic as electronic patient records, even after several years of planning and £12.7 billion of funding. [10]

The second is delivery. The simple fact is that a publicly funded safety net does not have to mean government provision of services – a single public payer may be the cheapest way to provide basic health care, but that doesn’t mean every nurse has to be a government employee. [11] Governments in developing countries are looking to private providers to compete with each other for public contracts, and realizing significant benefits. Although there is a precedent for this kind of deal within the NHS, private takeovers are still a long way from becoming an accepted part of the British healthcare framework. [12]

These relatively smaller private providers have the opportunity to deliver healthcare differently, in a way unrecognizable to most western countries. Aravind Eye Care in India is a ‘focus factory’, which deals with just one area of medicine and has a patient load equivalent of about 60% of NHS eye patients. In every measure, such as infections and complication rates, it is better than the NHS. Through ruthless attention to detail and the development of patient pathways that are near perfect, they have got costs down not to 50 per cent or 10 per cent of what we spend, but 1 per cent. [13]

Britain is right to be proud of the NHS it has built and the solid principles and ethics that underpin it, but we need to come to terms with the fact that we are clinging to old technologies and outdated models of delivery, and it’s quite literally killing people. There are 1000 patient deaths a month in Britain caused by avoidable structural and procedural errors, and these desperately need to be eliminated. [14] What we have in the BRICS is a series of case studies, clearly not all covered here, of how countries deliver better healthcare for patients. In order to uphold our healthcare values, we cannot continue to ignore these successful practices. The BRICS economies are realizing that private providers and innovative delivery methods are the only means through which they can meet their commitment to ensure universal access to publicly funded healthcare. It is time our Government did the same.

Article by Adam Hawksbee. Edited by Ben Mackay.

Further Reading

[1] ‘Health care in Brazil – An injection of reality’ The Economist (July 2011)

[2] ‘New cradles to graves’, The Economist (September 2012)

[3] ‘Rethinking the welfare state’, The Economist (September 2012)

[4] Sir Michael Marmot ‘Fair Society, Healthy Lives’ (UCL Institute of Health Equity, February 2010)

[5] House of Commons Public Accounts Committee ‘Management of NHS Hospital Productivity’ (March 2011)

[6] ‘New cradles to graves’, The Economist (September 2012)

[7] ‘Rethinking the welfare state’, The Economist (September 2012)

[8] Schumpeter ‘Asian innovation’, The Economist (March 2012)

[9] http://www.nesta.org.uk/news_and_features/frugal_innovations/ge_ecg_machine

[10] http://www.guardian.co.uk/society/2011/sep/22/nhs-it-project-abandoned

[11] ‘Rethinking the welfare state’, The Economist (September 2012)

[12] Reform ‘Takeover: Tackling Failing NHS Hospitals’ (September 2012)

[13] Reform ‘A lot more for a lot less: Disruptive innovation in healthcare’ (June 2011)

[14] http://www.telegraph.co.uk/health/healthnews/9396739/Poor-hospital-care-needlessly-killing-1000-NHS-patients-a-month.html