Healthcare Asia Magazine (April 2015)

ISSUE NO. 3

Display to 30 January 2013 to 30 June 2015 Display

The magazine for healthcare administrators and policy makers

www.healthcareasiamagazine.com

Going beyond

efficiency Hong Kong Hospital Authority CEO Leung braves the budget blues to keep HK healthcare on top

Healthcare Asia

Bumrungrad’s Dr. Watson

Why invest in Asian

healthcare? healthcare gap

in thai cities

Vietnam’s

pharma dilemma

SLMC CEO empowers doctors with customer-centric care

ceo interview

ANALYSIS Healthcare deals surge as Asia’s population ages

OPINION Change required in Southeast Asia regulatory climate

first Challenges in Asia’s medical device industry

PAge 14

PAge 28

PAGE 31

PAge 05

2 HEALTHCARE ASIA

FROM THE EDITOR This is Healthcare Asia’s third issue, where we continue to comprehensively cover a diverse range of countries and healthcare challenges in Southeast Asia.

Publisher & EDITOR-IN-CHIEF Tim Charlton PRODUCTION Editor Roxanne Primo Uy Editorial Assistant Joana Rizza Bagano

In this issue, we are featuring Hong Kong Hospital Authority and its CEO, Dr Pak Yin Leung, who discussed with us what it’s like to run one of the world’s most efficient public healthcare systems.

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We also highlight St. Luke’s Medical Center in the Philippines for which CEO Dr. Edgardo Cortez shared his management strategies.

Speaking of management, we also have a story on healthcare solutions – both in talent and communication management.

Meanwhile, we have a feature on Thailand’s tier-two cities, and how they are trying to catch up with Bangkok in terms of healthcare quality and investment attractiveness.

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Flip through the pages and find stories on patient care in Asia, Singapore’s imaging boom, and Vietnam’s pharmaceutical manufacturing woes, including varied opinion stories from healthcare experts.

We wish you the very best of health.

Enjoy this issue!

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HEALTHCARE ASIA 1

CONTENTS

innovating southeast 04 FIRST asian healthcare

18

16 ANALYSIS MYDOC, ntt data redefine healthcare management

Feature profile HKs Hospital Authority bankrolls upgrades in 2015

FIRST

FIRST

04 Vietnam healthcare firms struggle

08 Asia’s medical industry gets

locally

05 Singapore’s imaging boom

empowers doctors and client with customer-centric care

12 Funding the top issue Asian

hospitals face in patient care 22 Cancer care in Bumrungrad

06 Private health insurance in Asia 06 R&D boom in emerging markets digital hospital

14 St. Luke’s Medical Center CEO

investment boost

REGULAR

05 Asia’s medical device industry

08 Australia’s first fully integrated

PROFILE

26 Thailand’s tier-two cities

28 Healthcare deals surge as Asia’s

population ages

OPINION 30 Designing highly reliable and safe

care systems 31 Change required in Southeast Asia regulatory climate 32 The need for system thinking and accreditation

Published Tri-annually on the Second week of the Month by Charlton Media Group 101 Cecil St. #17-09 Tong Eng Building Singapore 069533

2 HEALTHCARE ASIA

To access the stories online, visit the website

www.healthcareasiamagazine.com

FIRST law that would give the company distribution rights granted to all local manufacturers,” maintains DeNoble.

A domestic manufacturing base in Vietnam will be critical as pharmaceutical companies look to make strong inroads into provinces and device makers attempt to elbow their products into supermarkets.

These are expected to offset the difficulty of getting in-market price increases, following the country’s economic challenges such as currency devaluations and cost base inflation.

innovating asean care

Southeast Asia is fast becoming a hub for the healthcare sector, with medical tourism becoming more mainstream rather than a novelty.

Dr Yong Chern Chet, healthcare sector leader, Deloitte Southeast Asia, believes that 2015 will see the true emergence of new business models and blending of well-established healthcare stakeholders, ie provider, producer, and payer. These are blurring the traditional divide between the businesses and the entrants of new parties into healthcare.

“Potentially, we expect to see health insurance schemes from hospital groups, healthcare services or medical facilities from pharma/medical device companies, insurance companies setting up healthcare facilities or investing in medical start-ups, technology giants and telco getting into healthcare via a technological healthcare platform route,” says Dr Yong.

The growth is not without its challenges and, for the healthcare industry as much as any other sector, money really matters. Dr Yong says that the rapid rise in demand for healthcare services has created an imbalance and will, as a result, skew the price of healthcare, further compounding the problem.

“The way forward goes back to the discussion and exploration of new business or practice models for healthcare consumption,” he adds. “The healthcare industry should start to do things differently quickly as we do know that by doing things the way they have been done, the problems will not be truly solved and they will get worse. There are already many real world scenarios/model to observe this kind of outcome,” Dr Yong concludes.

4 HEALTHCARE ASIA

The challenge of tech transfer

Vietnam healthcare firms struggle locally

T

he biggest challenge for Vietnam’s leading healthcare companies in the coming years is to figure out how to build a manufacturing base in the country, despite a wobbly operating environment. A Health Intel Asia report published recently discussed a wide range of opportunities and challenges for pharmaceutical companies and medical device makers in Vietnam. In this report, Damjan DeNoble, founder and managing director of Health Intel Asia, reveals that manufacturing is in many ways the final frontier by which these firms can create growth.

Not all dominant players have manufacturing operations in Vietnam, but several have set up facilities to take advantage of benefits granted to companies that are manufacturing in the country.

Many of the rest are planning to set up their own domestic manufacturing operations in the next few years due to the clear advantages; especially in improving efficiency.

“A domestic manufacturing base would allow them to lower costs by both cutting out the need to import products, and by triggering a special provision of Vietnamese

Healthcare firms are hoping that the Vietnamese government will create a less risky operating environment.

Government and operating challenges A manufacturing strategy seems, on paper, to be the most promising path for the major healthcare players in Vietnam. But DeNoble says that executives have expressed great concern about the level of interest of Vietnamese authorities in coming up with a clear development agenda for the manufacturing sector of the country.

Healthcare firms are hoping that the Vietnamese government will create a less risky operating environment for their manufacturing operations, by solving outstanding issues such as raw material shortages and reformatting regulations by offering incentives to foreign companies that invest in manufacturing and risk technological transfer in the country.

Forecasted total pharma market CAGR at 19%

Source: IMS, Meridian Vietnam

FIRST With their technology investments, device makers might raise their equipment prices.

X-rays golproactive

Singapore’s imaging boom

W

ith the rise of chronic diseases and an increasing elderly population in Singapore, the island’s residents are shifting their medical spending strategy towards early disease detection instead of reactive treatment. This bodes well for advanced diagnostic imaging services, which have seen increased demand. These allow Singaporeans to detect a disease before it progresses into the later, deadlier, stages with higher costs.

This preventive thinking will especially drive revenues in the private outpatient diagnostic

services market, which is projected to have a compound annual growth rate of 13.5% between 2013 and 2019, says Poornima Srinivasan, healthcare consultant at Frost & Sullivan. Market earned revenues are estimated to grow from US$127.8 million in 2013 to US$273 million in 2019.

“Both patients and healthcare givers are seeking solutions that can aid in early diagnosis and regular monitoring, which, in turn, is driving the usage of diagnostic imaging services,” says Srinivasan.

In order to deliver more accurate results and a wider variety of tests

to Singaporeans, manufacturers of diagnostic image services devices are investing in new technologies – and this will be the name of the survival game for device makers hoping to come out on top.

“Given the competitive nature of the market and end-user desire for novel, high-quality products, diagnostic imaging service providers with innovative technologies will flourish,” says Srinivasan.

With their technology investments, device makers might raise their equipment prices, but Srinivasan warns that making the diagnostic devices too expensive could backfire. Hospitals and laboratories are already somewhat constricted by the high capital expenditure on equipment, she says, and are also deterred by the related service and maintenance costs and lack of insurance reimbursement coverage.

Hospital admissions per 1000 residents, by age

Source: MOH

The Chartist: TOP CHALLENGES IN ASIA PACIFIC’S MEDICAL DEVICE INDUSTRY Money matters in the medical device industry, and to senior level executives in Asia Pacific who are always challenged by a lack of funding. A survey by medical device consultancy firm Emergo reveals that regulatory and financing issues are the primary challenges for all the top decision makers in the medical device industry.

The increase in reimbursement challenges may be due to increased pressure imposed by payers on device companies to demonstrate the economic benefits of their device. Emergo adds that many larger companies report feeling pressure on pricing. Smaller companies seem unable to pass along increased costs as easily when the survey asked executives about the various pressures they face.

Funding (green) is the top concern

Source: Emergo

Decrease in sales or turnover

Source: Emergo

HEALTHCARE ASIA 5

FIRST

Private health insurance Asia’s care backbone

R&D boom in emerging markets

G

one are the days when only a few individuals, mostly the well-to-do, could afford decent medical insurance coverage. Analysts forecast Asia to be one of the regions that will show remarkable growth in terms of health premiums in the next five years. It comes as no surprise then that private health insurance (PHI) premiums in emerging economies, specifically those of the reimbursementtype, are predicted to double by 2020 as more people now want and can afford them.

In a sigma study, Swiss Re states that there has been significant growth in product premiums among emerging markets. “Consumers will increasingly be purchasing PHI because it provides a means to pay for the level of healthcare services they need,” says Kurt Karl, chief economist at Swiss Re. In addition, PHI also has significant potential as a main healthcare expenditure source as it continues to grow. “The study shows the insurance industry is well-equipped to meet the increasing healthcare spending needs of individuals, and that it can also become a central pillar of a sustainable national healthcare delivery system,” Karl adds, noting that only less than 10% of total healthcare spending of main emerging

Insurance makes access easy

markets in 2012 was derived from PHI. Reimbursement-type PHI products grew by about 11.2% in real annual terms between 2003 and 2013, and are expected to grow by an average of 9.6% per year to 2020, three times faster than the world average. Data for fixed-benefit PHI products, meanwhile, were described as “scarce,” but expert interviews nevertheless point to their swift growth.

“In Emerging Asia, many governments have earmarked reimbursement products as a growth area, and premiums are forecast to grow by 15.4% annually between 2013 and 2020, the strongest of all emerging regions,” says Karl.

Reimbursement type PHI products are expected to grow by an average of 9.6% per year to 2020.

Asia’s healthcare talent fever: Where are the doctors?

Executives across the region’s healthcare sector agree that manpower is of utmost concern, with turnover rates landing between 40 % and 70%.

A survey by Korn Ferry Institute reveals that the challenge is recruiting the quantity and quality of medical personnel at all levels — management, administration, doctors, nurses, and clinical assistants — to ramp up services to meet demand.

Korn Ferry says, “It is imperative that boards align their talent and business strategies, starting with succession management. Senior managers also need to focus on building a strong pipeline of leaders with recruiting and retention strategies. They should look beyond their comfort zones when recruiting staff, whether in new geographies or from nonmedical industries, where there may be skill sets relevant to the health care business.”

6 HEALTHCARE ASIA

Life sciences companies have always viewed the Southeast Asian market as secondary to traditional mainstay markets due to lower purchasing power and overall health care system maturity. That perspective is now changing, as the region is developing rapidly and holds considerable future potential.

According to a recent report

by Deloitte, Asia’s emerging economies are reaching a level of maturity whereby consumers are able to afford the full spectrum of products from life sciences companies, which should increase the region’s strategic priority.

“While most manufacturers do not consider the region to be an R&D or clinical centre of excellence, some are using facilities there to modify products for emerging/low-cost markets,” says Janson Yap, Deloitte Southeast Asia Life Sciences and Healthcare industry leader.

Local innovation is set to improve with infrastructure improvements and foreign investment, with locally based R&D and clinical trials improving market access, shortening licensing approval periods, and producing a genuine pioneering product.

“There is a movement towards establishing a more organized regulatory framework, as evidenced by China and India’s significant push for regulatory reforms, and health care industries and the ASEAN Economic Community’s (AEC) work to define a regional regulatory landscape via the establishment of common dossier templates and harmonisation of tariffs,” adds Yap.

FIRST

3 factors that make Asia an ideal target for healthcare investors

I

f there was ever a good year to be sick, it would be 2015, as public and private entities are injecting renewed vigour into the Asia-Pacific region’s healthcare scene.

Experts are predicting that the industry will continue on an upwards trajectory, spearheaded by innovations in primary care and hospital services.

“Overcrowded public hospitals, urbanization, disease and lifestyle trends, increasing private health insurance coverage, and awareness of the importance of health management will see the private hospital market in Singapore grow at a rate of 13% between 2015 to 2020,” says Rhenu Bhuller, senior vice president of healthcare at Frost & Sullivan Asia Pacific.

The expectation, though, will not be met through sheer government will alone. A lack of public funding with a mere CAGR of 0.7% since 2000 has led to fairly high prices and premiums that are out of reach for the majority of the population. Furthermore, APAC’s large population is a breeding ground for chronic diseases which require specialized facilities and products.

“There is rising demand in Asia for sophisticated healthcare products and services. Market dynamics, [forecasted long term growth, and low M&A activity in the Asia-Pacific] will lead to attractive private sector investment opportunities opening

up in the region,” notes Sanda Wijeratne, manager at Stax Inc. The compatibility of medical devices and consumables — as well as the ensuing demand and government support — within ASEAN will drive investments towards these segments. The efforts in health technology assessment are also expected to impact thr pricing and availability of products and services, hopefully channelling them to countries that sorely need them.

Additionally, a more accepting market with liberal policies benefitting and protecting consumers will lead to easily obtainable healthcare wares driven by patient- and not profit-interests.

Moreover, pharmacies will continue transitioning into a more proactive medical body advocating patient compliance, preventative healthcare, and over the counter treatments, reducing the load on emergency and confinement rooms, as well as minimizing healthcare costs in the long run.

Finally, telecoms will play an integral role in home health integration. Improvements in their infrastructure and existing portfolio, combined with the proliferation of smartphones and wearable devices, are expected to create trouble-free basic health monitoring.

Bhuller adds, “With the aim of shifting patient loads from hospitals to primary care,

Refocusing priorities

governments in South East Asia are driving initiatives to create a more robust primary healthcare sector, even while they focus on improving basic healthcare access and services. The Asia Pacific region (ex-Japan) will continue to provide double digit growth in 2015 at 11%, compared with the global average of 5%.”

“The trifecta of rapid growth in demand, inadequate supply, and low deal activity makes Asia an ideal target for healthcare investors,” says Wijeratne.

healthcare WATCH

Australia’s first fully integrated digital hospital The $96m, 96-bed St. Stephen’s Hospital, Hervey Bay, is a technological breakthrough in healthcare. It houses the country’s very first full EMR and digital patient management system. This is in addition to a digital drug dispensing facility and a capacity to monitor patients during surgeries.

A report published in the run up to Healthcare Week Asia 2015 reveals that everything in the hospital from x-rays to equipment monitoring in theatres will be done electronically.

“A large proportion of funding for the project has been from the federal government, with $21 million alone specifically for eHealth, along with $15.5 million from UCH and our main software vendor, Cerner,” says Richard Royle, executive director of UnitingCare Health, which operates the hospital.

8 HEALTHCARE ASIA

The hospital’s main entrance

Standard room

Main building landing

Ground floor hallway

HEALTHCARE ASIA 9

Co-published corporate profile

A different take on healthcare innovation How CapsuleTech is reinventing our idea of medical solutions into their medical records,” he says.

Almost two decades ago, there was very little competition for CapusleTech’s idea. When a major need for the innovation surfaced in 2004, the company received its first round of venture capital funding. Shortly thereafter, CapsuleTech started a division in the United States.

Gene Cattarina, CEO

W

hen on the subject of the medical technology industry, what often comes to mind is the idea of ‘invention’. Most people who wish to enter and thrive in the industry are always looking to invent the “machine of the future” – the next CT scan, the next X-ray, and so on. While it’s all about plain creation for most, CapsuleTech shows that innovation comes in different forms; that building on current technology is just as innovative and useful as creating a completely new invention.

Building on history Founded in France in 1997, CapsuleTech began as a small consulting company. As it navigated its way through the clinical IT market, the company discovered a niche that it could fill. CEO Gene Cattarina recalls the hospital information system of the past and describes the complications that it suffered. “Many of the bedside medical devices had different protocols, many standards. It was a real problem for hospitals to take this data and move it

The Idea CapsuleTech’s core business is providing medical device information systems, which are designed to capture and manage data from a hospital’s various medical devices for timely delivery to electronic medical records, as well as clinical systems for analysis and decision support. The company is present in the US, as well as in Singapore, at over 1,700 hospitals in 37 countries, and is looking to expand further to the rest of Southeast Asia.

CapsuleTech’s big idea was actually borne out of the clutter left behind by past ‘new ideas’. “There was a very important niche that needed to be filled in clinical IT and healthcare,” shares Cattarina, “that niche was to be able to get medical information from medical devices into the electronic medical record.” CapsuleTech was able to see that the plethora of unintegrated medical devices was making it difficult for hospitals to efficiently synthesise medical data for effective analysis.

By simply focusing on the data communication shortfalls of the then-current medical devices instead of focusing on building something completely new, CapsuleTech was able to provide a solution to the medical field’s multiple medical device data integration problems which were often shrugged off. Problems such as the risk of human error, the risk of untimely responses, and plain inefficiency of what was then a primarily manual data entry process, were addressed by a simple yet game-changing innovation.

“By simply focusing on the data communication shortfalls of the then-current medical devices instead of focusing on building something completely new, CapsuleTech was able to provide a solution to the medical field’s multiple medical device data integration problems which were often shrugged off. Problems were addressed by a simple yet game-changing innovation.”

10 HEALTHCARE ASIA

From the very beginning, location has been a key element for CapsuleTech in terms of business expansion and growth.

“The growth opportunity today is to look at things globally,” Cattarina adds. This is one of the reasons why CapsuleTech is in Asia, particularly in Singapore. The company is currently looking at four very important markets: the US, Northern Europe, Southeast Asia, and Middle East. For CapsuleTech, Southeast Asia’s remarkable growth is the key factor driving the Company’s initiatives in the region. CapsuleTech already has one major tender in Singapore along with four major tenders going on in Australia.

“Singapore is the gateway to Southeast Asia. The sophistication of healthcare IT in Singapore is rather good compared to other countries, and that makes what we do important.”

Scaling up solutions CapsuleTech is also proactively taking steps to widen the reach of their solutions. For instance, CapsuleTech’s Medical Devices Information System could change the way doctors respond to critical cases. “We can take the data and send it to the hospital’s clinical decision support and alarm management systems, which can alert doctors to a patient’s deteriorating condition,” shares Cattarina.

This is especially important for cases such as Sepsis, when the prospect for recovery virtually decreases by the hour.

CapsuleTech is also developing dashboards to monitor biomedical devices. “We will know exactly what’s going on, which medical devices are being used, when they’re being used, and what room they’re being used in.”The company aims to extend its reach to other areas such as ambulatory, longterm care and skilled nursing facilities.

CapsuleTech’s systems will not only allow hospitals to be more efficient in their operations, but the information collected through CapsuleTech’s systems could also help make Big Data more intelligible.

Ultimately, CapsuleTech’s goal is to improve the quality of clinical outcomes, decrease the chances for medical errors, and improve the productivity of clinicians in their day-to-day work environment.

CONNECT any MEDICAL DEVICE TO any EMR Capsule has developed healthcare’s first Medical Device Information System (MDIS) to tie together your medical devices into an integrated system that provides connectivity to your EMR.

medical device information system

Capsuletech Asia-Pacific PTE. LTD south-asia@capsuletech.com Phone: (+65) 8258 9837

www.capsuletech.com

healthcare INSIGHT: patient care in asia

More funds for better care

Funding the top issue Asian hospitals face in patient care While Asia’s health industry must address a host of vital issues, analysts agree hospital coffers need the most attention.

I

f it seems that today’s hospitals are shaping up to be better venues for healing, one need only follow the money to see why. Hospitals seem to be moving quickly to implement management reforms to meet demand for better patient care, and a large part of this has been centred on better financial management of medical institutions.

While chiefly concerned with the business of health management, hospitals also have to deal with the financial aspect of their operations — “how financial resources are generated, allocated and used in health systems,” as the World Health Organisation (WHO) puts it.

“There will be greater concern over how we spend our resources and the returns we get out of them. Hospital managers will have to simultaneously balance both commercial and societal concerns in order to thrive in the 12 HEALTHCARE ASIA

How well a hospital is run is usually a reliable indicator of the quality of patient care it is able to provide.

changing environment,” says Mark Cheong of the University of Malaya Specialist Centre.

Money: a valuable resource According to a 2012 survey by the American College of Healthcare Executives (ACHE), “financial challenges” remained the top issue confronting hospitals, as it has been in the past few years, followed only by “patient safety and quality” and “healthcare reform implementation.”

“As CEOs (chief executive officers) are positioning their organizations to succeed in an uncertain environment, it is not surprising that financial challenges, patient safety and quality, and healthcare reform continue to be on their minds,” says Thomas C. Dolan, ACHE president and CEO. How well a hospital is run is usually a reliable indicator of the quality of patient care it is able to provide,

according to a joint report by the Organisation for Economic Cooperation and Development (OECD) and WHO. “Quality is a significant concern even in health systems that are well developed and resourced, with expected patient outcomes not always achieved and wide variations in standards both within and between health systems,” according toHealth at a Glance: Asia/Pacific 2014: Measuring Progress toward Universal Health Coverage by OECD and WHO. “Hospitals with high quality services would attract not only patients who can afford, but also preferred health care professionals,” says Krit Pongpirul, quality and research advisor at Thailand’s Bumrungrad International Hospital, adding, “When the majority of hospitals become more efficient, safety and quality of care would be the key differentiation.”

Cheong adds, “with greater financial resources, we will naturally be able to better enhance our capabilities and add value to our services. Seeking better returns on investments seems easier said than

healthcare INSIGHT: patient care in asia done, however, as there is still much room for improvement in this area.

According to Bruce Campbell, a neurologist and research fellow at Australia’s Royal Melbourne Hospital, “the efficiency of health care delivery, regardless of local funding constraints,” remains a common problem among Asian hospitals.

This challenge should be taken positively by hospitals and healthcare professionals to make do and improvise with current resources.

“In the face of financial constraints, we may have to discover more efficient processes and cultivate a greater sense of cost-sensitivity throughout the hospital instead. The quality of our healthcare services and the outcomes received by our patients are sacred to us and should not be adversely affected by financial constraints,” Cheong says.

Meanwhile, some Asian countries seem to be faring better than others as far as patient care is concerned.

Singapore, for instance, boasts a superior healthcare system, further bolstered by well-managed hospitals.

“We want Singaporeans to be confident that they can always afford the care they need. Part of this involves managing costs in our system,” says Gan Kim Yong, Singapore’s Minister for Health.

Financing, however, is only one aspect of patient care. “The exact configuration of services varies from country to country, but in all cases requires a robust financing mechanism; a well-trained and adequately paid workforce; reliable information on which to base decisions and policies; well maintained facilities and logistics to deliver quality medicines and technologies,” WHO says.

In order to guarantee the implementation of top patient care initiatives, countries are urged to adopt clear policies or standards that help define and operationalize the best patient care practices.

“Where health systems, particularly in developing countries, need to optimise the use of resources and expand population coverage, the improvement process needs to be based on sound local strategies for quality so that the best possible results

are achieved from new investment,” according to the OECD. Some countries, for instance, have defined policies such as Malaysia’s Strategic Plan for Quality in Health, Nepal’s National Quality Assurance Policy, and Cambodia’s National Policy for Quality in Health, Evaluating Quality Strategies in Asia/ Pacific Countries, another joint WHO and OECD survey in 20132014.

“A legislative and regulatory framework for quality of care generally addresses three types of health system inputs: health professionals, health services, and the safety of pharmaceuticals and medical devices. Most of these countries responding to the survey have laws related to quality,” according to the OECD. The manpower factor In order to ensure quality, hospitals need to be staffed with competent health professionals capable of providing outstanding patient care.

OECD calls them “the foundation of a health care system.”

“Access to sufficient and well-trained physicians, nurses, technicians and hospital staff will continue to be a major concern for the foreseeable future,” says Michael Wong, CEO of Malaysia’s Pantai Hospital Ayer Keroh.

The OECD, however, recognizes that doctors’ knowledge and skills need to be regularly updated in order to be properly utilized.

“Licensing, continuous professional education and development and professional certification and re-certification can help assure professional performance,” the OECD advises.

The burden of patient care is the heaviest on the general health workforce for a variety of reasons, according to WHO. “Workers in health systems around the world are experiencing increasing stress and insecurity as they react to a complex array of forces. Ageing population, new diseases, as well as increasing burden of current diseases, escalating conflicts, and violence, are all challenges to which the workforce must be prepared to respond,” the

group says.

“The unmistakable imperative is to strengthen the workforce so that health systems can tackle crippling diseases and achieve national and global health goals,” WHO adds.

Krit Pongpirul

Thomas Dolan

Michael Wong

Gan Kim Yong

Data accumulation and analysis Lastly, data gathering and interpretation also play a critical role in providing better patient care, both on a macro and micro level, as more comprehensive patient histories allow doctors and hospitals to monitor patients more closely and accurately, and tap a repository of baseline information for the classification and recognition of national health trends.

“Health information is a national asset used by policy-makers, planners, health care providers, development partners and the general public to track health-system performance and to support better health policies and make effective health-related decisions,” WHO says.

The value of vital health data in quality patient care cannot be overstated. “Nationally consistent data can help identify system failings and inform policy making, and assist in decision making about the allocation of health resources. Ideally, data infrastructure should enable a patient to be monitored over time, to follow their journey through the health system, and examine their outcomes,” says the OECD says. According toWHO and the OECD, 22 of the 23 countries it polled reported having nationally available hospital inpatient data. Room for improvement, however, may be found in the areas of cancer registries, prescription medicines, long-term care, psychiatric care, and patient experience.

Healthcare spending as % of GDP

Source: World Health Organisation

HEALTHCARE ASIA 13

Edgardo R. Cortez President & CEO St. Luke’s Medical Center 14 SINGAPORE BUSINESS REVIEW | JANUARY 2014

CEO INTERVIEW

CEO Cortez set on transforming St. Luke’s into a first-rate academic medical centre Dr. Edgardo R. Cortez uses strategic managemento move the world-class hospital forward.

S

t. Luke’s Medical Center is known as one of the top hospitals in the Philippines, and its Taguig hospital is one of the most beautiful in the world, according to US-based Healthcare Management News and Insights.

Healthcare Asia interviewed SLMC’s president and CEO Dr. Edgardo R. Cortez, who gave us an insight into what it’s like to be in his distinguished position.

What makes you excited about your position?

I am a surgical oncologist by profession. In my 31 years of practice, I have witnessed the plight of patients afflicted with diseas, as well as people searching for prevention of various medical conditions. I empathize with what they feel and the difficulties that their family members have to endure in the course of their illnesses.

It may be from mundane issues like who can accompany a patient during confinement to the grim reality of losing a loved one. I have also shared the joy with patients and their families after having a successful surgical procedure or announcing the absence of cancer and the like.

Given the chance to run the affairs of a first rate

“I would engage the doctors in a partnership where they will also have a responsibility to the patients and the institution as well, rather than simply treating them as clients.” medical facility like St. Luke’s, I am excited about the prospect of improving the delivery of state of the art healthcare that our patients deserve. We also have the unique chance to contribute new knowledge through medical research, and to train the new breed of specialists in the various fields of medicine.

What three goals are you focused on?

First, provide world class clinical outcomes or success rates through education, training and research. Second, improve quality of care and patient safety. Third, provide a great patient experience.

What would you do differently in this position?

I would provide an open, transparent and consultative leadership. I would like to identify great ideas from the people and transform them into actions which will propel the organization to achieve greater heights. I would engage the doctors in a partnership where they will also have a responsibility to the patients and the institution as well, rather than simply treating them as clients. I will put the patient in the centre, use data to drive decisions, and evaluate performance based on metrics.

What changes are you planning?

The transformation of our set up to a functional organization; the transformation of the Medical Center into an internationally recognized academic medical center; intensive use of IT solutions to enhance efficiency; promote St. Luke’s and the Philippines as a medical tourism destination; promote a culture of patient safety inside and outside St. Luke’s; promote ethical practice and professionalism in the workplace through a formal program; enhance service efficiency, clinical outcomes, customer focus to attain a great patient experience; enhance data collection and provide a good electronic medical record.

What are your key business philosophies?

Strategic management – knowing who we are, where we want to go and how we want to play; simplicity in the face of complexity in the healthcare environment; attaining agility in the face of a highly competitive environment; reinventing ourselves through innovation in healthcare excellence; knowing the needs of our patients through adequate customer analytics; making data-driven decisions tempered by experience; empowering people.

How have previous positions prepared you for this one?

Leading five professional national organizations taught me leadership, teamwork, and how to deal with people.

These positions included the Presidency of the Philippine College of Surgeons, Surgical Oncology Society of the Philippines, Philippine Academy for Head and Neck Surgery, Philippine Association of Training Officers in Surgery and Chairmanship of the Philippine Board of Surgery.

Twenty-five years of teaching Surgery in a university hospital taught me the value of education, training, research and commitment to life long learning. Attending business courses at the Asian Institute of Management, the Advanced Executive Education Program at the Kellogg School of Management at Northwestern University and exposure to my mentors have put in place the final piece in the puzzle – running a corporate business enterprise transposed to the healthcare industry.

Is there anything else you would like to add?

The major health challenge now and in the future is aging.

This is the consequence of a longer life span due to better healthcare. As a result, we will see more degenerative illnesses. In the near future, healthcare facilities will be evaluated on how well they can care for these chronic diseases, and there will be an increasing demand for continuing care in the community. We must address this challenge now or we will be too late.

HEALTHCARE ASIA 15

feature: health solutions

Consultations at your fingertips

MyDoc, NTT DATA redefine healthcare management

Healthcare solutions from Australia and Singapore aim to ease the burden of managing staff to provide better services to patients.

M

anaging staff and streamlining processes in the healthcare industry are big challenges for stakeholders, especially at a time when hospitals are poised to evolve and expand.

Taking this into account, two healthcare solutions are stepping up to the plate to improve the way hospitals and doctors communicate with staff and provide better services to their patients: the Talent Management for Healthcare solution and MyDoc, a digital platform for healthcare communications and care management.

“Managing talent effectively is a challenge for every organisation.

However, in the healthcare industry where there is a direct impact on the quality of patient care as well as numerous regulatory and quality standards to be met, the ability to manage staff is critical,” says Mark

16 HEALTHCARE ASIA

The healthcare sector has a critical dependence on meeting externally mandated standards for the quality of care.

Wade, HCM Practice Lead at NTT DATA Business Solutions, the company behind Talent Management for Healthcare. The solution is designed to improve the quality of care and operational effectiveness, and drive financial performance for healthcare operators throughout Australia, New Zealand and Southeast Asia.

Meeting standards Wade says the healthcare sector has a critical dependence on meeting externally mandated standards for the quality of care, which places immense importance on having adequate talent management processes in place.

Working with the Australian Health Services Group (AHSG) which boasts an excellent industry track record from both a clinical and line management perspective, NTT DATA Business Solutions came up

with a solution to provide insights to the responsibilities and challenges of the various departments, from the ward to the financial controller, and how each can benefit from a talent management approach designed to fit those unique challenges. NTT DATA Business Solutions has mapped these insights to their global expertise in implementing SuccessFactors, he adds.

“Customers will also benefit from being able to access AHSG’s extensive consulting experience if they require additional support to adopt and bed down the processes built into the delivered content,” Wade says.

“AHSG can help them to prepare strategically and operationally, whilst NTT DATA Business Solutions will enable and accelerate the technical aspects of the solution deployment. We see this as an element of the partnership that will grow in importance as we deliver the solution throughout South East Asia countries, such as Singapore, Malaysia, Philippines, Thailand and Vietnam, where the healthcare industry continues to expand and evolve as those economies scale,” he adds.

feature: health solutions Talent Management for Healthcare is deployed using SuccessFactors, the world’s leader in human capital management cloud software.

“SuccessFactors is different from other talent management and human capital management solutions because it offers more than process efficiency and transactional cost savings. All healthcare organisations, regardless of size, will find answers to their talent challenges – from sourcing, recruiting, training and retaining staff to improving collaboration and productivity,” Wade says.

With 15 million users globally, the SuccessFactors BizX Suite is designed to ensure that organisations complement strategy with performance to achieve better business execution, by helping them align the workforce with strategy and ensure people are working on the right tasks; optimise performance across the organisation by finding the right people and improving them; and accelerate business results with the insight needed to run the organisation better.

Business-wise, the Talent Management for Healthcare Solution helps in auditing organisational performance against healthcare benchmarks; makes leadership accountable with demonstrable bottom-line outcomes; and measures the workforce across hospitals, wards and departments.

Innovating communication Meanwhile, Singapore startup MyDoc is a digital platform that provides doctors and patients a secure platform for virtual consultations by voice, video to text; peer-topeer messaging and e-referrals; virtual appointment scheduling; and personal health diaries with diagnostics and personal health device intergration.

Dr Snehal Patel, MyDoc cofounder, says that, unlike other communication services that are limited to managing the communications amongst a subset of the healthcare ecosystem, MyDoc aims to connect all of the various agents in the healthcare ecosystem, which includes healthcare

Mark Wade

Snehal Patel

professionals, patients and payors.

“We also uniquely facilitate intraagent communication, by providing healthcare professionals the ability to connect with their colleagues and send e-referrals and medical grade imaging studies to each other.

The ability to provide multiple value propositions to healthcare professionals is a key priority – doctors are famously picky when it comes to technology. Being one of a very few healthcare IT startups led by physician co-founders, we have spent a good deal of time making sure that our product resonates with our colleagues and solves real pain points,” he adds.

Patel says the startup was borne out of “a profound dislike for some of the solutions that we were forced to use and a sense that there were specific pain points and needs that were not being addressed by them.

“However, we feel that a lot of the hype in the digital health space is focused on solutions looking for a problem,” he says.

Patel says that, while the core functionality of the platform is robust, they are also working on adding elements that will maximise their partnerships with key health partners across the sector, such as Guardian Health & Beauty, as well as improve the functionality of their health screening management.

“For example, we are working with some innovative organisations to integrate their health management programs into the MyDoc platform to increase the number of services that can be accessed through the convenience of one platform. With additional items in the pipeline, we are focused on adding the appeal of MyDoc as a comprehensive platform for communications and health management,” he says.

Working in the region Being a health provider-centric organisation, MyDoc has been expanding across ASEAN by partnering with health professionals, diagnostic facilities and healthcare consumer-facing organisations.

“The simple e-referral feature of our platform has been hugely in demand in markets that have far greater levels of fragmentation in their private healthcare markets,” Patel says. He adds that myDoc helps solve specific holes in the delivery of healthcare information through a blend of healthcare professional communication tools.

“We are excited at our current traction and with the enhancements we have in the pipeline, and are looking forward to connecting even greater numbers of stakeholders in health in the ASEAN region in the months to come,” he says.

Improving patient-doctor communication

HEALTHCARE ASIA 17

feature profile

CEO Dr Leung shares his plans

HK Hospital Authority bankrolls upgrades in 2015 Funds are in place for boosting manpower and developing facilities.

I

f Hong Kong expects to continue providing its citizens with quality public healthcare, the government must be able to quickly diagnose serious challenges moving forward, as well as administer a booster shot of reform initiatives as needed.

Central to solving Hong Kong’s public healthcare concerns is the Hong Kong Hospital Authority (HA), an independent and statutory body that takes care of the former British colony’s public hospital services.

“It offers medical treatment and rehabilitation services to patients through hospitals, day hospitals, specialist clinics, general out-patient clinics, Chinese medicine service, and community outreach services that are organised into seven clusters which together serve the whole of Hong Kong. Hong Kong citizens can enjoy subsidised medical services provided by HA,” the Hong Kong Special Administrative Region (SAR) 18 HEALTHCARE ASIA

The healthcare cost per capita in Hong Kong rose by nearly 40% in 2014 versus 2013, reflecting accelerated spending for every Hong Kong citizen.

government says on its website.

For many years, Hong Kong has prided itself on the quality of its healthcare system, catering to a broad segment of its population.

A quality system Founded in 1990, a significant 90% of Hong Kong’s in-patient services are handled by HA, with 10% being covered by the private sector.

“Hong Kong has a quality healthcare system, supported by a team of highly professional healthcare workers. Our public and private medical sectors provide a full range of diversified services, including a low-cost public healthcare ‘safety net’ that ensures no one in Hong Kong is denied medical care due to a lack of means,”said Chief Executive Leung Chun-ying earlier this year.

An important indicator of Hong Kong’s top-notch public healthcare system is the life expectancy rates of the population. As of 2013, Hong

Kong men and women were expected to live up to 81 and 87 years, respectively, according to the Hong Kong Special Administrative Region’s Census and Statistics Department.

“Both figures represented an increase of some nine years compared with 30 years ago. The life expectancy at birth in Hong Kong is comparable with those economies experiencing low mortality such as Japan and Sweden,” says HA. Life expectancy happens to be one of the three main criteria of Bloomberg’s “Most Efficient Health Care 2014: Countries” listing, which last year named Hong Kong as the world’s second-most efficient healthcare system (second only to Singapore), with an efficiency score of 77.5, based on life expectancy, relative per capita cost of healthcare, and absolute per capita cost of healthcare.

In response, Dr Pak-yin Leung, HA Chief Executive, says: “We are running a highly efficient system.

The efficiency means we are using a lot of money [to have] a good healthcare outcome. We are running emergency departments, heart transplants, kidney transplant services, and other major services.”

Healthcare cost per capita in Hong

feature feature profile profile Kong rose by nearly 40% in 2014 versus 2013, reflecting accelerated spending for every Hong Kong citizen, according to Bloomberg. This, however, is only a miniscule portion of the country’s budget, based on last year’s government audit. For the years 2014-2015, HA spent about HKD 52 billion, or only about 2.5% of Hong Kong’s gross domestic product, according to Dr Leung.

Sustaining a good system Nevertheless, Hong Kong’s healthcare budget is channelled toward a diverse set of reform-oriented goals. “We will seek to ensure the sustainability of our healthcare system through a series of reform measures, including the promotion of long-term development of primary care and Chinese medicine, proposed introduction of the Voluntary Health Insurance Scheme, revamp of the regulatory regime for private healthcare facilities, and implementation of the electronic health record programme,” the Policy Address states.

Meanwhile, while still remaining relatively low, HA’s budget is expected to expand by about 3.1% to 54 billion HKD for 2015-2016 in order to “meet the increasing demand for hospital services and to improve the quality of clinical care.”

Measures include installing 250 additional beds in five hospitals; widening indications of Special Drug for Multiple Sclerosis and introducing new drugs to the Drug Formulary to benefit 4,000 patients per year; performing around 5,300 additional endoscopic procedures; increasing the episodic quota for general outpatient clinics in five clusters by 55,000; setting up a 4eth Joint Replacement Centre for 90 additional operations in 2015-2016, and for 250 additional operations per year moving forward; strengthening psychiatric teams’ manpower and crating a peer support element to the Case Management Programme for patients with severe mental illness; relocating Yan Chai Hospital’s Geriatric Day Rehabilitation Centre to a new wellness centre and doubling geriatric day places from 20 to 40 places; and conducting 3,000 additional visits to residential elderly care homes.

“We are going to have an increase in money mainly to improve, to have additional beds for our patients, and to improve acute services (stroke, cardiac, and renal),” Dr Leung explains, adding that there will also be an expansion of existing stroke treatment centres.

Better-equipped Aside from direct medical facilities, HA will also bankroll the upgrade of its IT (information technology) systems in order to improve electronic clinical management and drug administration functions, alongside the creation of a larger general drug formulary.

“We need to put in about 200 million HKD to improve our IT system. Currently we are rolling out an inpatient medication ordering system. That means we can prescribe drugs in the ward through electronic means. This is going to help us a lot in terms of patient safety,” Dr Leung explains.

Accordingly, the larger drug formulary will also be supported with increased funding: “Each year we spend around 4 billion HKD on drugs. Next year, we are going to put more money, around 44 million HKD, into the drug formulary,” says Dr Leung.

Completing HA’s plans for 2015 are the delivery of new MRI (magnetic resonance imaging) and CT

HA’s budget is expected to expand by about 3.1% to HKD 54 billion for 2015-2016, in order to meet the increasing demand for hospital services and to improve the quality of clinical care.

(computerized tomography) scan machines, in addition to the ones already in use, in order to meet demand for them, as well as speedier psychiatric services for children.

“Because we have a long waiting time for our child psychiatry, next year, we are going to put in more resources to reduce waiting time for child psychiatry patients,” says Dr Leung.

Such aggressive plans require adequate financial backing from the government, however — leading to concerns that perhaps current state subsidies may no longer be enough.

“Financially, we appreciate government support. Imagine: we charge only HKD 100 per day for in-patients,” says Dr Leung, noting that this amount, already heavily subsidised by the government, “includes everything — it’s a single fee,” for the patient.

Money is key Without proper funding, typical challenges such as shortages in facilities and healthcare professionals may prove to be more difficult to meet head on.

For one, Hong Kong’s medical infrastructure, much of which has been around since the British administration, may no longer be on par with most modern standards. “Some hospitals are over 60 years old, so we need to have a development program

More doctors coming in

HEALTHCARE ASIA 19

feature profile

Dr Pak-yin Leung Chief Executive HK Hospital Authority

and project for infrastructure,” says Dr Leung.

At present, Hong Kong manages 42 public hospitals and institutions, 47 specialist out-patient clinics and 73 general out-patient clinics, all organized into seven hospital clusters based on locations, namely Hong Kong West, Hong Kong East, Kowloon Central, Kowloon West, Kowloon East, New Territories East, and New Territories West.

“Hospital clusters ensure that patients receive a continuum of high quality care within the same geographical setting and throughout their episode of illness – from acute phase through convalescence, rehabilitation, and community aftercare. This is achieved by rationalising operations of the hospitals within each cluster, so that a comprehensive and complementary range of services can be delivered to the community,” HA explains on its website.

According to Dr Leung, the current number of medical facilities in Hong Kong is expected to grow as the government has already earmarked a projected HKD100 billion in the next decade for the development and construction of major public hospitals.

“We are going to have one new hospital, the Hong Kong Children’s Hospital. It is expected to commence services in 2018. We [also] have one new hospital already built, and it has already started operations; this is called the North Lantau Hospital. We 20 HEALTHCARE ASIA

have another new hospital coming in 2016, the Tin Shui Wai Hospital, so that we can keep up with the need for in-patient services in terms of the ageing population and the need for facilities,” Dr Leung says.

For 2015-2016 alone, HA plans to spend an estimated HKD1 billion out of the HKD13 billion provision for minor works projects. The allocated sum, according to HA, will be directed toward the improvement and refurbishment of facilities found in public hospitals and clinics, such as the addition of hospital beds and other treatment and diagnostic facilities.

Losing manpower?

In addition to infrastructure issues, Hong Kong also seems to be facing a problem with the dwindling number of people working in its public hospitals in the years to come.

“Because of the demand for medical services, we are lacking healthcare professionals. We are lacking doctors,” Dr Leung laments.

The attractive compensation in the private sector seems to be enough of an incentive for Hong Kong’s public hospital doctors to leave in search of greener pastures. “We have a very good private sector, where doctors are earning more,” Dr Leung explains.

According to the latest data, HA employed 70,132 staff members, of which 5,910 were doctors, and 23,721 were nurses. The remaining were either allied health personnel or other staff, including management, support, and administrative staff.

But these figures seem to be lagging behind the overall progress currently being made by Hong Kong’s healthcare sector.

“We need doctors and nurses. We are having new developments, new hospitals with more beds. There’s a lot of pressure here. With the hospital services we are providing, we don’t have enough doctors to fill in the vacancies. This is the challenge,” Dr Leung says.

Nevertheless, things are beginning to look up as Hong Kong welcomes more medical graduates next year.

For one, Hong Kong’s local universities expect to produce more medical

For 2015-2016 alone, HA plans to spend an estimated HKD1 billion out of the 13 billion provision for minor works projects.

graduates in 2016.

“Recently, we have more new graduates coming in,” Dr Leung says, given that in a typical year, about 300 students graduate from Hong Kong’s medical schools. “Next year will be a better year, around 400,” he predicts – an increase of a third versus last year.

The forecast for the nursing industry in 2016 also appears to be equally optimistic. “Nurses are getting better, because we have better supply this year. This year, we have about 23,000 nurses, and each year we have a positive index. That means after filling in the vacancies, we still have sufficient nurses for new services,” Dr Leung says.

However, the issue regarding Hong Kong’s doctors appears to be more complicated, and HA is set on addressing a current shortage situation by stepping up its game in promotion procedures, and hiring back older hands. “We have more promotion strategies for doctors and nurses and supporting staff. We have a high attrition rate for supporting staff, so we’re going to improve their working conditions and terms of employment.

We had measures for retaining our doctors by improving their promotion, and this year we are going to re-employ our retired doctors,” Dr Leung says, noting this would mean scrapping HA’s current retirement rule which mandates retirement at age 60.

“But now, after retirement, we give them a contract to re-employ them. We are introducing a full-time contract for retired doctors in the coming year,” Dr Leung says.

Aside from renewed full-time work, HA is also ready to offer part-time employment to its retired doctors.

“We have a very good part-time

State spending as percentage of GDP

Source: OECD, HK government

feature feature profile profile scheme, for doctors who may have left HA for private practice, or some who have retired. We have about 330 part-time doctors now,” says Dr Leung.

Ageing gracefully Hong Kong’s struggles with its medical facilities and manpower represent typical challenges to any first-rate public healthcare system. However, Hong Kong is also beset with other issues unique to the island – that of a rapidly ageing population, and a looming threat of influenza affecting much of its senior citizens, especially during winter.

Much like Japan’s own demographic winter, Hong Kong’s ageing citizens pose serious challenges to its public healthcare system.

“People are getting older and when people are getting older, they need more healthcare services,” says Dr Leung. This is not to say that Hong Kong neglects its senior citizens.

According to the Policy Address, “As Hong Kong turns rapidly into an ageing society, development of elderly care services has become even more important. In the face of the challenges brought about by an ageing population and the changes in the prevalence of diseases, we will uphold our commitment to providing quality and affordable public healthcare services. We will increase the capacity of the healthcare system on the one hand and enhance service quality on the other, through service and infrastructure development,” Dr Leung adds.

With the objectives of enabling senior citizens to live in dignity, with the necessary support for the promotion of a sense of belongingness, security, and worthiness, HA is committed to implementing concrete measures to uplift the health of Hong Kong’s elderly.

“We will continue to implement a host of measures and initiatives to enhance elderly care on all fronts. For the frail elderly, we strive to provide quality and cost-effective long-term care services in line with our policy of promoting ‘ageing in place as the core, institutional care as back-up.’

In this respect, we will strengthen and expand community and home

care services whilst at the same time increase and enhance subsidised residential care services. We will also carry on with our efforts to provide support services for carers of the elderly,” the Policy Address says, outlining specific plans and initiatives for elderly healthcare services, ageing in place, long-term care services for the elderly, financial support for the elderly, and planning and integration of elderly services.

Seasonal woes Aside from dealing with its elderly population, Hong Kong is also facing a potential threat in the form of the influenza virus, a seasonal threat made even deadlier when it hits the very old and the very young, especially because it is contagious.

“We have one more challenge.

It’s about influenza,” says Dr Leung.

Influenza research conducted in the past few months reveal more older people getting sick, thus more than doubling hospital admission rates in medical wards, to over 120% in some cases.

According to Hong Kong’s Centre for Health Protection (CHP), flu “season” in Hong Kong occurs from January to March, and again from July to August. The situation gets complicated, however, when a simple case of the flu escalates to pandemic

Hong Kong is also beset with other issues unique to the island—that of a rapidly aging population, and a looming threat of influenza.

proportions.

“Influenza pandemics occur roughly every 10 to 50 years, and may strike any time of the year,” CHP explains. “They are usually associated with a large number of cases, higher severity of illness, a higher death toll and consequently greater social and economic disruption.”

Incidentally, Hong Kong has had a dark history with the flu and flu-like pandemics: in the late 1960s and early 1970s, an estimated 1 million people worldwide died from the so-called Hong Kong flu, while in the early 2000s, it was SARS (Severe Acute Respiratory Syndrome) that took their toll on the global human population.

“Capacity is lacking in this area, especially during winter time. During that time, we need to mobilize our internal resources to give special allowances to our doctors and nurses who are working overtime and reschedule their whole working hours,” Dr Leung says.

Nevertheless, it seems Hong Kong is doubling up its efforts to combat influenza through CHP. A detailed preparedness plan outlining the government’s preparedness and response plan in case of an influenza pandemic has been uploaded to CHP’s website, while latest influenza updates are also posted on the site.

Tech upgrades in place

HEALTHCARE ASIA 21

feature: dr watson

Personalized care at its finest

Cancer care in Bumrungrad

IBM’s Dr Watson will revitalise the hospital’s oncology department.

T

hailand’s premier international hospital has partnered with medical tech pioneer IBM Watson to provide better cancer patient care and research.

When Bangkok-based Bumrungrad International Hospital was pondering how it can become the leading healthcare provider in Thailand and Southeast Asia, it chose medical technology as its path for competitive advantage. Bumrungrad had developed a strong reputation

22 HEALTHCARE ASIA

“Bumrungrad is the first medical institution outside of North America to use IBM Watson for Oncology.”

among international patients as a trusted treatment facility for cancer and other serious conditions, so the hospital focused on gaining even more expertise in these areas by partnering with IBM Watson.

In late 2014 Bumrungrad announced that it will be working with IBM Watson to integrate the latter’s cognitive computing technology for cancer care known as IBM Watson for Oncology.

Bumrungrad is the first medical

institution outside of North America to use IBM Watson for Oncology, and be trained by leading cancer center Memorial Sloan Kettering (MSK) – an initiative the hospital expects will raise the quality of patient care and research.

“We attract the best doctors and we need to equip them with the best technology,” says Dr. Num Tanthuwanit, Chief Executive Officer of Bumrungrad.

“IBM Watson is part of our overall hospital strategy. It has been on our radar, and we just waited for it to reach the mature stage where it is applicable for healthcare.”

The Watson partnership is crucial as Bumrungrad looks to attract even more international patients and become a top destination for global medical tourism. Currently, half of the over one million patients Bumrungrad serves annually come from almost 190 countries outside of Thailand. Given the same number of patients this year, Bumrungrad’s share will represent more than 15% of the estimated three million international patients that will visit Thailand.

One of Bumrungrad’s core international markets are families from the Middle East and emerging Asia economies that travel to the hospital for advanced treatment of cancer and other serious conditions.

Bumrungrad believes IBM Watson for Oncology will help doctors plan the most effective treatments for cancer patients.

Under the system, the hospital and its doctors will compile the patient’s profile and existing medical evidence. The hospital then feeds

feature: dr watson this information to IBM Watson for Oncology’s cognitive computing technology, which consequently delves into myriads of other factors that could affect treatment recommendations such as published medical research, MSK’s extensive clinical expertise and National Comprehensive Cancer Network guidelines. After analyzing all of these facts, the system presents a summary of findings relevant to each patient case. Bumrungrad’s treating doctors will theoretically receive the best and the most carefully considered treatment options for each of the patient.

“It is like having a capable and knowledgeable colleague who can review the current information that relates to my patient,” said Dr. James Miser, Bumrungrad’s Chief Medical Information Officer of the new system when the IBM Watson partnership was announced late last year.

Personal research assistant Tanthuwanit emphasises that doctors have their hands full these days, with more patients to look after and more knowledge to consult, not to mention other medical positions they might be holding. At the very least, the IBM Watson for Encology system serves as a “personal research assistant” that helps doctors keep up with what can sometimes become an overload of information, and at most it can propose effective treatment options that a doctor might overlook.

“Medical knowledge is increasing very fast and cancer care is particularly complex. Oncologists race against time to find the best

“IBM Watson’s computing system helps integrate different arms of the oncology department such as the medical, radiological and surgical, resulting in a more seamless patient process.“

treatment for their patients. How does one take into account all the latest clinical research? How do you find what doctors elsewhere have learned from treating a patient like yours?” says Tanthuwanit.

“Watson makes it possible. Our physicians will have a more powerful tool to help them make treatment decisions, ultimately improving our care and increasing patients’ lifespans.”

The system also significantly increases the speed of formulating proposed treatment plans.

Tanthuwanit asserts that the system can suggest a treatment plan in as fast as a few minutes compared to days or months through traditional diagnostic methods. This increased speed can have a palpable impact on treatment outcomes. As an example of how the whole process will work, Tanthuwanit narrates that a patient is referred to Bumrungrad’s oncology center also known as the Horizon Center. He says the treating oncologist would begin by logging the patient’s data into the system, after which IBM Watson computers would match that person’s demographics with similar situations in the past, as close to that patient’s profile as possible.

Then the data is matched with available literature, which then enables the system to forward recommendations and suggested medications to the doctor.

Tanthuwanit says IBM Watson’s computing system helps integrate different arms of the oncology department such as the medical, radiological and surgical, resulting in a more seamless patient process.

The partnership generates process efficiencies not in patient care but also in medical research.

“Operationally, Watson will be very helpful in the research aspect to monitor and see whether this helps or not. It can also be a support system. Watson helps organise and integrate information into electronic medical records. It can actually be an extension of the electronic medical records,” says Tanthuwanit.

International expansion Bumrungrad is betting big that the IBM Watson partnership will help the hospital gain competence on Big Data, and lead in forming applications beyond what IBM Watson for Oncology was developed for, namely lung, breast and colorectal cancer. Liver cancer could be one of these new applications, according to Tanthuwanit.

Bumrungrad already holds the distinction of being the largest private facility in the region, but if it manages to develop groundbreaking applications to IBM Watson for Oncology, it can edge out other facilities in Thailand and Southeast Asia.

The hospital is expanding its capacity in order to accommodate a strong stream international patients – the hospital a robust first half of 2014 and anticipates what could be its highest patient level year in history – and a spurt of arrivals following the IBM Watson upgrades. Two plots of land have been approved for Bumrungrad, says Tanthuwanit, where the hospital plans to construct an extension that is within walking distance from the original campus.

HEALTHCARE ASIA 23

CO-PUBLISHED CORPORATE PROFILE

Actavis acquires Allergan: Prescribed pharmaceutical excellence in the works

Actavis further bolsters its portfolio of world-class services and products.

A step up in R&D

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ust when you thought that the pharmaceutical industry couldn’t get even more shaken up, out comes Actavis plc with news that they’ve completed the acquisition of another medical giant, Allergan, after a hotly contested bidding process. Now with a reinforced corporate structure, strengthened employee numbers, and the intellectual prowess of two drugmakers, the new Actavis seeks to reinvigorate the world’s pharma scene with a strong dose of commitment and guile.

A world-leader in pharmaceutical products and services, Actavis currently has operations in 100 countries and boasts a best-in-class portfolio dedicated to sustainable and accessible treatments, innovative research and development projects, and relationship-building with medical professionals.

Specifically, Actavis prides itself in spearheading the fields of dermatology, medical aesthetics, and plastic surgery (25% of revenues); eye care

24 HEALTHCARE ASIA

(23%); neuroscience and CNS (23%); gastroenterology (10%); and women’s health (7%). These, on top of being at the forefront for treatments of prevalent diseases such as Alzheimer’s, schizophrenia, depression, and poststroke spasticity.

For their shareholders, Actavis guarantees a diverse revenue stream and a continuously growing global presence.

The brand is one of the three most prolific providers of generics to the US market, and is a name to be reckoned with in 30 international markets. This strength in generics will prove beneficial to Actavis as according to the IMS Institute for Healthcare Informatics, close

Specifically, Actavis prides itself in spearheading the fields of dermatology, medical aesthetics, and plastic surgery.

to half of the pharmaceutical industry’s growth—around USD 143 billion to USD 190 billion—will come from these affordable yet effective medicines.

The high return of investment for this segment is compounded by expansion opportunities in emerging markets.

Acquiring medical firepower To further boost its pioneering pharma endeavors, Actavis has acquired fellow medical company Allergan, Inc. through a cash and equity transaction valued at about USD 66 billion dollars. The fearsome combination merges two of the world’s top 10 pharma companies by sales revenue, with an anticipated 2015 performance of more than USD 23 billion.

“The combination of Actavis and Allergan creates an exceptional global pharmaceutical company and a leader in a new industry model—Growth Pharma,” said Brent Saunders, CEO and President of Actavis. “Anchored by worldrenowned brand franchises, a leading global generics business, a premier

CO-PUBLISHED CORPORATE PROFILE pharmaceutical development pipeline, and an experienced management team committed to maintaining highly efficient operations across the organization, we are creating an unrivaled foundation for long-term growth.“ The groundbreaking deal is predicted to create double-digit accretion to nonGAAP revenues within the first year, including close to USD 1.8 billion in operating and financial funding synergies within the first 12 months after the transaction. Next year, Actavis anticipates an even better operating cash flow over USD 8 billion which will de-lever balance sheets. Actavis is also poised to take on the name “Allergan” this 2015 pending the approval of their shareholders.

For a healthier future With the acquisition in the books, Actavis now has an army of worldrenowned franchises with combined pro forma 2015 revenues of close to USD 15 billion, including further stakes in the five medical fields mentioned above. Some of the blockbuster names under the merger are Botox, Restasis, Juvederm, Saphris, Namenda XR, Alphagan, Liletta, Linzess, Zenpep, Bystolic, Teflaro, and Lo Loestrin, among others.

Actavis’ commitment to a prolific research and development-driven portfolio will be carried over with an estimated USD 1.7 billion worth of investment in the pipeline this 2015.

Durable, effective, and bang for your buck products within its brands, generics, biologics and over the counter offerings are currently in the works, including Cariprazine, Eluxadoline, Esmya, Aczone X and Darpin AMD, among others.

“Supporting the growth of this innovative industry model is our strategically focused R&D engine, built on novel compounds in specialty and primary care markets where there is significant unmet medical need, and fueled with approximately USD 1.7 billion in annual investment,” added Saunders.

The company’s generics lineup will continue to grow, with approximately 230 New Drug Applications being processed at the Food and Drug Administration, 70 of which are first-tofile applications. Additionally, Actavis has around 1,000 marketing authorization applications filed in non-US markets last 2014.

Physicians, patients, and the entire

medical community will ultimately be at the end of a win-win situation not only because of the promising R&D outputs, but also because of the two company’s commitment to fostering a mutual relationship with their stakeholders. “Our combined company will be built around a customer-focused commitment to partnering with physicians, pharmacists, and patients to deliver innovative treatments and enhance access to important therapies around the world,” comments Saunders.

Input from those practicing the profession will better the care given to patients and will lead towards solutions that will cater to unfulfilled medical needs. With the merger comes an integrated senior management

team that is composed of the world’s best pharmaceutical executives. The hierarchy is currently structured to discover and cultivate promising talents from both companies, capitalizing on their combined global footprint in both branded and generics.

Saunders concludes, “With the acquisition now complete, we will immediately begin implementing our comprehensive integration plans to ensure that we leverage our strengthened global organization to generate sustainable organic earnings growth from our newly expanded base, and continue our ascent into the fastestgrowing and most dynamic growth pharmaceutical company in global healthcare.”

Next year, Actavis anticipates an even better operating cash flow over USD 8 billion which will de-lever balance sheets. Actavis is also poised to take on the name “Allergan” this 2015 pending the approval of their shareholders.

An ever-expanding global presence

Actavis CEO and President, Brent Saunders

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HEALTHCARE ASIA 25

cOUNTRY report: thailand

Driving towards better healthcare

The healthcare gap between Bangkok and tier-two cities Why the healthcare industry in Thailand’s tier-two cities has lagged behind, and how that’s about to change for the better.

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mong the Southeast Asian economic peer group, Bangkok has long been one of the major cities in economic development and healthcare infrastructure. Unfortunately, and to the detriment of the country’s tier-two cities, the story has been left there.

Since the development of healthcare has usually been viewed in aggregate terms, dispersing this development has been regarded as a secondary concern. This has resulted in tier-two cities’ private healthcare industry being generally smaller and less adequate compared to Bangkok’s.

On the bright side, this mindset is about to benefit tier-two cities as industry growth.

A clear, quantifiable understanding of how wide the healthcare gap has been between Bangkok and the second tier is necessary in order to fully appreciate the process of

26 HEALTHCARE ASIA

One of the major causes of the existing healthcare gap between Bangkok and tier-two cities is the lack of higher-income prospects in tier-two cities.

narrowing the gap. Data provided

by Sittichai Duangrattanachaya, healthcare analyst at Maybank Kim Eng Thailand, show that, in Bangkok, there is one doctor for every 1,075 people, and one nurse for every 285. While this may initially seem inadequate, this measure is 59 % and 43% better, respectively, than what is seen in second tier cities. There are also 3.7 beds per 1,000 people in Bangkok, 54% better than in second tier cities. This data is accurate as of over a year ago.

Brushing up Clearly, the availability of healthcare professionals and facilities in Bangkok relative to the population is much more adequate than what is seen in Thailand’s tier-two cities. However, in spite of this, the situation in 2013 is still a marked and notable improvement from what was observed in 2007.

Hospital beds per 1,000 people in second tier cities have increased by 16% from 2007 to 2013. Moreover, the number of people per every one doctor have also declined by 15%, and the number of beds per doctor have decreased by 18% over the said period. This notable improvement in the state of healthcare within the country’s tier-two cities is mostly attributed to the introduction of the National Health Security Scheme in 2003, as well as the Social Security Scheme in 2005.

One of the major causes of the existing healthcare gap between Bangkok and tier-two cities is the lack of higher-income prospects in tier-two cities, which ultimately discourage healthcare investments from the private sector. Duangrattanachaya says that Bangkok Dusit Medical Services prefers to build hospitals in Bangkok as it seeks to serve mid-income and foreign patients “who have insurance coverage and high disposable income.”

Prospective patients from tier-two cities are captured by the private sector mostly through referral programs. Thus, due to the private sector’s lack of interest in tier-two

cOUNTRY report: thailand cities, most of healthcare spending in these areas have been due to the government. According to Wanwadee Tiavongsuvan, senior consultant at Solidiance, the public sector contributes over 99% of total healthcare spending in Thailand.

At this point, it becomes clear that the key to improving the healthcare industry in Thailand’s second tier cities lies in improving household incomes since, as mentioned earlier, the abundance of low-income prospective patients is what drives away private investment in the first place.

Rapid urbanisation One of the most important drivers of improving household incomes in Thailand’s second tier cities is increasing urbanisation in areas outside Bangkok. “Urbanisation rates in second tier cities have doubled those of Bangkok and its vicinities.

While the growth rate of urbanization in Bangkok’s vicinities is less than 10% annually, the same growth in second tier cities have averaged at 57% in the same period,” says Tiavongsuvan.

Data show that household incomes have increased along with the increase in urbanisation, implying that they are, at the very least, correlated. For instance, from 2000 through 2011, household incomes have more than tripled in Surat Thani, and more than doubled in Ubon Ratchathani and Songkhla.

As a result of growing household incomes in Thailand’s second tier cities, “private hospitals in Thailand are targeting second tier cities because of the expected growing demand for healthcare services boosted by increasing urbanization and the ASEAN Economic Community,” says Tiavongsuvan. This is especially true of Thailand’s publicly listed hospitals, where growth is of utmost importance.

Duangrattanachaya confirms this by pointing our that 90% of planned hospital capacity expansion is currently allocated to the areas of second tier cities. Major hospital chains in Thailand such as Bangkok Dusit Medical Services, Ramkhamhaeng Hospital Chain, and Bangkok Chain Hospital have

Prospective patients from tier-two cities are captured by the private sector mostly through referral programs only.

all recently expressed commitments to ramping up their presence and operations within Thailand’s second tier cities.

Another driver set to further increase demand for healthcare in Thailand is the ageing population.

Duangrattanachaya notes that the proportion of older citizens to the rest of the population is likely to increase to 9% in 2016 and 10% in 2020, from around 8% in 2013.

The rise of tertiary healthcare Improving overall incomes and wealth have not only opened the door to more services and consequently, better healthcare for Thailand’s second tier cities, but have also paved the way for the rise of tertiary healthcare. In a nutshell, tertiary healthcare mostly has to do with elective treaments such as cosmetic surgery, as opposed to primary and secondary healthcare which is more geared toward non-elective treatments.

Tiavongsuvan says medical tourism in Thailand has been growing at a healthy pace. Medical tourism in Thailand from 2008 through 2013 has grown by a CAGR of 17% in terms of number of patients, and by a CAGR of 28% in terms of revenues. A key driver of this growth has been the cost competitiveness of Thailand’s medical tourism industry. Duangrattanachaya notes that the cost of treatment in Thailand is 20% lower than in Singapore, and the quality of service in Thailand is also better than in Malaysia and Singapore.

Tiavongsuvan notes that there

is evidence that the growth of urbanization and, thus, household incomes within Thailand’s second tier cities is likely to lead to the growth of not only primary healthcare facilities and services, but tertiary or elective services as well. “In response to growing purchasing power within second tier cities, the supply of medical care in second tier cities is now ranging from primary to tertiary care with a comparatively higher number of private hospitals in the provinces.”

However, unlike the outlook for primary and secondary healthcare in Thailand’s second tier cities, the outlook for the tertiary healthcare industry is not as unanimously positive. Duangrattanachaya notes that the medical tourism industry in Thailand faces competitive threats especially from Middle Eastern countries whose investments in medical tourism infrastructure have recently been aggressive.

Thus, according to Duangrattanachaya, “we see potential growth, but the speed of growth may not be as high as the past decade.”

Nevertheless, the effect of global competition on Thailand’s medical tourism industry should likely be partially offset by rising incomes within Thailand’s second tier cities (paving the way for domestic medical tourism).

Whether it be primary or tertiary healthcare, it is clear that Thailand’s tier-two cities need more of it, and better quality. However, given the current direction, this shouldn’t be a problem for long.

Populations per doctor

Source: Ministry of Public Health, NESDB, Maybank Kim Eng

HEALTHCARE ASIA 27

analysis: health economics avenues and platforms, such as joint ventures or public-private partnerships.

Looking for home-based care?

Healthcare deals surge as the Asian population ages The rise in chronic diseases is boosting the need for more services.

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istorically, per capita healthcare spend by Asian countries has been miniscule compared with that of mega-spenders like the US or Norway. However, with an ageing population, rising affluence, and demand for better health services in Asia, healthcare expenditure growth in the APAC region is set to outstrip North America’s.

Healthcare spending in Asia is expected to grow at a compounded annual growth rate of 9.2% in the near term, compared with 5.6% in the US. In fact, the growth of healthcare spending in many APAC countries has exceeded economic growth over the past few years, resulting in an increasing share of the economy being devoted to health.

Between 2000 and 2012, per capita spending on health in Asia grew on average ~5.6% in real terms, while GDP growth was at ~4.3%. Despite

28 HEALTHCARE ASIA

The growth of healthcare spending in many APAC countries has exceeded economic growth over the past few years.

the substantial growth already taking place in the Asian healthcare industry, the lion’s share of M&A activity is still happening in the US, and only ~20% of global healthcare M&A activities in 2012-2013 were transacted in Asia.

2014 was a record year for healthcare M&A activity worldwide – nearly 2,500 deals took place at a total value of ~$412B. Once again, the US dominated with ~66% of that activity being attributable to US domestic deals.

There are several reasons why investors may still be hesitant to focus on Asia – companies are relatively small and may not be in the right stage of growth, diligence is harder to perform, and politics and bureaucracy create barriers and make the region less attractive.

However, there is much profit to be had for those who truly understand market needs and are willing to explore a variety of investment

Demand drivers The APAC region is currently home to ~300M people aged 65 or above – over half of the world’s total senior population. This number is growing rapidly due to improvements in life expectancy.

As a result, Asia’s ageing population is expected to reach~565M by 2030.

Japan is home to the fastest-ageing population in the world, with almost a quarter of its population being over the age of 65 – far more than in the US and Europe.

Hong Kong, China, Thailand, the Republic of Korea, and Singapore are also seeing a rise in their elderly populations. This trend will accelerate demand for healthcare products and services catering specifically to the 65+ segment.

Many elderly patients prefer to be at home with their loved ones and are willing to pay for the convenience of home healthcare services rather than be admitted to a healthcare facility. The global market for home healthcare is expected to grow at a CAGR of 7.8% to reach ~$355B by 2020, with the APAC region expected to grow fastest at a CAGR of 9.7%. However, there have been just two home health and hospice related deals in Asia in the last two years, compared with 58 in the US over the same period.

A few fast-moving home healthcare providers in the U.S. have identified the gap in Asia and have already started to enter the space. For instance, in 2013, US–based home healthcare firm Bayada purchased a 26% stake in Chennai-based India Home Health Care. This is the first investment outside the US for the privately held Bayada.

Similar to the home health space, other products and services specifically for the elderly living alone – such as ambulance services, medical alert devices/personal emergency response systems (PERS), and animal companions – will also see growth. For instance, the global PERS space is set to reach

analysis: health economics ~$2B by 2020, with ~30% of that market value being derived from Asia.

Chronic diseases are the leading cause of mortality in the world – representing 63% of all deaths – and are growing faster in Asia than in the rest of the world. In 2013, diabetes caused about 5M deaths worldwide, and over 60% of them occurred in the APAC region. The growing prevalence of diabetes and other chronic diseases – such as coronary heart disease and cancer – has created a need for specialty care facilities, wellness plans, healthy products, and health tracking/measuring devices.

The APAC region is currently home to ~215M people who live with diabetes, and this number is expected to reach ~366M by 2030. Projections of significant growth within the region have spurred international players to pursue acquisitions. For instance, KKR recently completed its biggest buyout to date in Japan by acquiring an 80% stake in Panasonic Healthcare – a provider of digital medical-record systems and instruments that measure blood glucose.

With the increasing need to keep track of chronic disease data, big data analytics is also gaining momentum in the Asian healthcare industry, and specialized companies are already making use of this opportunity. For example, US-based Truven Health Analytics, a provider of healthcare data analytics solutions and services, announced the opening of a Singapore-based regional head office to cater to the exponential adoption of patient and clinical data management technology in Asia.

Furthermore, there is an increasing demand for wellness products in

In pursuit of lower-cost, higher-profit care options, providers in Asia are expanding outside of the traditional acute hospital setting into outpatient clinics and standalone surgery centers.

Percentage of population aged 55+ in select Asian countries (2000 vs. 2050)

Source: CEIC, HSBC Source: UN, World Bank, OECD, IMF, IPSS Japan

Funds for fitness

Asia – in 2013, of the top 10 fastestgrowing markets for health and wellness packaged food, five were APAC countries. China, Indonesia, Vietnam, Thailand, and India are significant growth markets that may be of interest to potential investors.

Supply constraints Governments in Asia, on average, finance ~48 % of total healthcare expenditure in the region (about the same percentage as US public expenditures). This share has increased at a CAGR of just 0.7% in Asia since 2000, resulting in a significant role for the private sector in catering to the rapidly rising growth in demand.

At 3.3 per 1,000 persons, the number of hospital beds in Asia is lower than the OECD average of 4.8, but with significant differences between countries – ranging from 13 beds per 1,000 population in Japan to 0.5 per 1,000 population in the Philippines. Private hospitals in the region are growing, however, and favourable government policies in several countries are also encouraging investments in state hospitals and public-private partnerships.

For example, Seattle-based Columbia Pacific Management Inc. is investing up to $200M to construct two 250-bed multi-specialty hospitals in China. The investment came after China lifted restrictions on foreign-owned hospitals to improve healthcare and address the medical needs of a wealthier, ageing

population. Chinese authorities in 2014 set up a pilot program that allowed foreign investors in some parts of the country to set up hospitals or acquire existing ones.

Also, in pursuit of lower-cost, higher-profit care options, providers in Asia are expanding beyond the traditional acute hospital setting into outpatient clinics and standalone surgery centres. Each of these areas, and more, represents possible growth and investment opportunities.

Even with rising wages, healthcare is still expensive – especially as many Asian countries lack adequate health insurance plans. High medical costs, coupled with low penetration rates of public insurance, open up an opportunity for private insurance companies such as Cigna Corporation, which recently entered into a joint venture with Indian conglomerate TTK Group to sell health insurance products in India.

There is scope for equity sponsors to back small, fast-growing companies individually or in combination, as distribution channels emerge and the entire ecosystem grows. With the substantial growth and variability between markets and customer groups, the keys to success in Asia lie in understanding the nuances of markets, opportunities, and risks, and in determining where to build and invest in organic growth versus where to acquire and ride the wave of market growth on current infrastructure.

by Sanda Wijeratne, Manager, STAX HEALTHCARE ASIA 29

OPINION

PAUL BARACH

Designing highly reliable and safe care systems

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atient safety and patient centred care are emerging as key drivers in healthcare reform. Things have changed but often as a byproduct of financial reform. Safety and quality benchmarks are being integrated into all healthcare organisations’ strategic goals. There is more focus on patient-centred care but these are early days. Patients still have little leverage in their own healthcare and still experience needless harm, and often struggle to have their voices heard. Processes are not as efficient as they could be, and costs continue to rise at alarming rates while quality issues remain.

Major changes are needed in the delivery model. The socio-technical approach suggests that adverse incidents can be examined from both an organisational perspective that incorporates the concept of latent conditions and the cascading nature of human error commencing with management decisions and actions (and equally inactions). Organisational resilience is found in the responsiveness of care delivery teams to an emerging hazard. Some teams are more resilient – able to recover from errors reliably without leading to patient harm, while others do not learn and repeat the same errors.

Ineffective engagement and authentic partnering with clinicians remains one of the

health-care delivery – patients and clinicians – incorporating relevant knowledge from other scientific disciplines such as operations research, organizational behaviour, industrial engineering, and human factors psychology. There is an urgent need to build the ground-up capacity of clinicians to make sense of the complexity in care. A recent analysis of 100 Root Cause Analyses (RCA) suggest that the next stages in patient safety efforts should involve practical experimentation with meaningful “There is an urgent need to build the ground- tools and methods at the local level.

It is timely to assess the quality of up capacity of clinicians.” information made available through clinical governance compliance efforts, it’s interpretation and real value to safety biggest obstacles globally in addressing the improvement. Healthcare services are currently growing implementation gap in providing cost too fragmented for effective application of the effective, and quality care. Physician discontent, patient centred model of quality improvement. cynicism, and growing numbers of burnt-out Effective improvement of care requires clinicians all point to a serious trust gap. meaningful efforts to address the trust gap with clinicians. At the most basic, this will involve Addressing the trust gap a re-conceptualization of the patient from the Several studies have identified the need to passive object of medical intervention to an “engage physicians” as the biggest challenge in active ‘consumer’ or ‘user’ of health services who healthcare reform, for example in the efforts to co-produces and ‘owns’ their own health.Patient mobilize key stakeholders to support hospitalcare needs to be reframed from task oriented at based efforts to improve care transitions and the level of the practitioner, to a systems based, reduce avoidable rehospitalisations. Physician microsystems based patient-centred model involvement is key to their leading, facilitation, that looks to the relationships within the socioand participation in accelerating the adoption of technical microsystems in which care is actually new care models. delivered. This includes a commitment to full Innovation in patient care is best designed disclosure when things go awry. in concert with those on the front lines of 30 HEALTHCARE ASIA

PAUL BARACH, MD Professor Wayne State University

Engaging physicians

OPINION

VAnessa pawlak

Trade winds of change required in Southeast Asia regulatory climate

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outheast Asia must transform its health care system to address current challenges and future stressors, such as an ageing population and the increase in chronic health conditions. To effect such a transformation, the region must shift its economy away from the traditional model of care. This shift requires effective navigation of Southeast Asia’s complex and diverse population, and public health policy becomes a key tool for change. In some ways, these challenges are similar to those found in the US population and health care system.

Southeast Asia should consider these parallels in developing regulations that help its health system at large create a sustainable operation that delivers high-quality, low-cost care resulting in healthy and satisfied patients. Southeast Asia public health policy must address certain key elements: Geographic variation. Southeast Asia is highly susceptible to earthquakes and resultant tsunamis, along with seasonal typhoons and floods. Natural disasters and the long-term effects of climate change further increase health risks, such as the proliferation of communicable disease epidemics. Containment of such diseases becomes difficult, particularly amid concurrent infrastructure devastation. Public policy in these countries cannot ignore such health risks, which could have important social and economic consequences. Policy related to disease outbreaks has advantages as a public health strategy.

Population health variation. Even among the poorest populations, non-communicable diseases already kill more people than do communicable, maternal and perinatal conditions combined, with many of these deaths occurring before old age. But simply increasing the availability of care services and hospitals is not a sustainable solution. The ability to capture, stratify and analyze patient data to effectively predict patient health will aid public health management, both at the individual level and at the aggregate level.

Public policy and regulation that give incentives for the capture and exchange of information help make it easier to capture the right data and deliver insights that inform effective decisions.

Benefits of collaboration among nations.

The unique strengths of Southeast Asia’s leading countries are vital to helping the region at large. Public policymakers must consider creating common regulation across nations to

drive collaboration and regional cooperation.

Facilitating this collaboration through ASEAN and other associations will help put regulation in place faster. Where a policy is difficult to implement in certain nations, other nations should implement policies that specifically help nationals throughout the region obtain care across borders.

Other nations’ successes and failures. The US has largely addressed its health care crisis with better alignment of incentives, increased regulation and increased scrutiny of compliance with new regulations. The primary goal of new US regulation is the “triple aim,” which involves creating incentives for moving toward three goals simultaneously: improved quality of care, reduced cost of delivering care and overall patient satisfaction. The US system has commissioned programs such as the star rating system to assess how well certain public health care programs deliver on the triple aim. By observing how the US handles challenges in its health care system, Southeast Asia can better manage its own crisis.

With an aging population of more than 600 million people, an increasing level of chronic disease, and a region prone to natural disaster, Southeast Asia faces a complex crisis. If its nations are to build a sustainable health care system, they must adopt collaborative public policies and regulations that promote proactive care management and better overall population health management across the region.

VANESSA pawlak Senior Manager EY

Disaster preparedness

HEALTHCARE ASIA 31

OPINION

STephen leyshon

Pursuing quality in healthcare: The need for system thinking and accreditation

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ealthcare in Asia faces multiple and well known threats to the delivery of quality care; including ageing populations, emerging infectious diseases, the growth of physical and mental health long-term conditions, and inequitable access.

The question is not what problems we face in this vast and diverse region but, how we can overcome them to co-create safer, smarter and sustainable health services. System thinking and accreditation offer a way to address these problems in the pursuit of delivering quality for all.

System thinking is an approach to improvement that views challenges to quality as part of a wider, dynamic structure: looking for patterns of distributed risk rather than fragments or individual episodes.

Proactive approach As the WHO pointed out in their 2009 report on Systems Thinking for Health Systems Strengthening, it involves more than a reaction to a particular outcome or event; it requires a proactive and deeper understanding of the distribution, linkages and relationships among the processes that characterise the entire system.

Common in other safety critical and complex sectors, system thinking focuses on: • Establishing policies that set clear and explicit goals and directions regarding quality (including defining what quality means for an organisation and its end users and the results that should be delivered); • Mapping processes and identifying indicators to monitor those processes (including how they connect within and between organisations); • Identifying and assessing risks to human, technological and organisational safety and performance (including how these are distributed within and across organisations and who owns them); • Creating pre-emptive and mitigation controls to deliver safe and consistently reliable results; • Measuring process performance and monitoring the efficacy of controls; and • Continuously improving, through the analysis of performance and the adoption of necessary process changes to achieve results.

Benchmarking Accreditation is a framework to ensure system

32 HEALTHCARE ASIA

thinking is adopted in practice. Trained external peer reviewers evaluate an organisation’s compliance with pre-established performance standards that can be applied to specific threats (such as managing infection risk) or across services. Its importance in healthcare quality improvement as a way to ensure system thinking is lived in practice is established.

Shaw and colleagues, for example, concluded in 2010 that healthcare providers “… that have either ISO certification or accreditation are safer and better than those that have neither”, while Alkhenizan and Shaw noted in 2011 that “… accreditation programs should be supported as a tool to improve the quality of healthcare services”.

If healthcare in Asia is to meet the challenges it faces, and be able to deliver sustainable quality, then policy makers and providers should further increase the use of system thinking and accreditation. Together they form the foundation for healthcare to become safer and smarter, while coping with local contextual threats. www.dnvgl.com/assurance/healthcare/index.html

Stephen leyshon Deputy Director Healthcare Strategic Research and Innovation, DNV GL

Looking for patterns

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