1/ I will be posting threads addressing some of the ideas i outlined in my previous (admittedly long) alternative draft policy thread. The goal here is to start an in-depth discussion on the various aspects of a recovery plan. Starting with healthcare 👇
2/ First a disclaimer : i am neither a health care executive nor a MD, the ideas proposed are supposed to be a starter on the matter and i would hope professionals with skin in the game would weigh in.
3/ An overview of the current situation : Lebanon imports ~$1.4bn and exports only $58mn in pharmaceutical products. The NSSF is broke, the hospitals are reeling under a mountain of debt with the gvt not paying its dues.
4/ Quality of services is dropping and innovation is practically non-existent. Availability of advanced services is concentrated in the capital with patients sometimes dying on the road trying to reach trauma centers.
5/ Clearly the whole system is collapsing and we risk loosing a sector which until recently was still leading in quality, region wise and even beyond.
6/ Let's start by addressing the pharma issue and its cost on the public sector. Currently the price of medicine is set by the ministry of health which reviews prices down every couple of years. The vast majority of the medicine are branded.
7/ The gvt recognizes(covers) those branded products and with their prices being constantly pushed down, importing generics becomes unappealing to importers.
8/ But with every reduction in prices the bottom line of international pharma groups take a hit while the gvt is still paying a hefty premium in its coverage. If profits go down much further multinational pharma might close their offices which would be a net loss to the country
9/ Another major issue with this policy is the impact on the BoP with a major cost of imports. It is notoriously difficult to get big pharma companies to accept locally producing under license because the market is small.
10/ I propose the adoption of generics for all the products with expired patents. These would need to be imported from high quality generics producers worldwide (such as Sandoz) and have the gvt cover only the price of those.
11/ In parallel the gvt would allow the floating of the price of branded items (unless no generics are available). What would end up occurring in this case would be an immediate reduction in the total import cost, while still providing multinationals with good profits (volume…
12/ …would go down but profits will be stable)
The health care bill would be reduced substantially without compromising quality.
The health care bill would be reduced substantially without compromising quality.
13/ Since those products would be off-patent, producing them locally would become the logical next step, and i propose creating HS codes for every family of products to eventually provide some tariff protection to producers which would create a drive in FDIs into the sector.
14/ It is extremely important to keep the availability of branded cutting edge pharma products available in the market and keep the multinationals invested in the country to drive medical tourism and innovation.
15/ For those who can afford it, they can pay a premium and access the best healthcare solutions in the world. But for the rest, a reliable cost-effective alternative would be provided by the gvt.
16/ We can reduce our import bill by $400mn per year by adopting such a strategy and producing them locally. It would be a major creator of white and blue collar jobs and it would drive research and innovation at the universities as well.
17/ It is crucial that in parallel with such efforts we beef up our control systems, and we should adopt FDA,or EMA approvals to start with then shore up our capacities to provide a safe regulated environment down the road.
18/ The coverage provided by the gvt should be unified and linked to an e-ID given to every citizen. Currently there are multiple agencies (NSSF, ministry ,various funds...) with fraud being rampant across all of them.
19/ The use of technology to address this issue is a must and the introduction of blockchain could be both innovative and secure. But regardless of the tech used, the usage of e-gvt in this case is not a luxury but a must.
20/ I propose the adoption of universal health care with every Lebanese citizen covered by the basic package, that by now cost much less because of the adoption of generics with a 100% coverage.
21/ A new agency which would be created under a PPP agreement would be replacing ALL other currently operating ones, creating a much larger pool and reducing costs further.
22/ The adoption of such a mechanism coupled with e-ID tech would reduce fraud to a minimum, waste in all of its aspects while improving services
23/ MDs would create a prescription online, linked to said e-ID and tracked properly.
24/ The patient would not pay a dime anymore at the pharmacy because the MD's prescription would allow him to get the generic covered at no cost, the pharmacy would be paid directly by the agency online.
25/ Under this scheme, every Lebanese citizen would be paying the same amount for the same coverage, while additional Insurance plans would give access to branded care keeping the very high quality health care available.
26/ The insurance companies would be covering the difference (which is already the case) and their premiums will be higher than they are at this point. But only those who can afford it would opt for those plans.
27/ Since the coverage is universal, all the hospitals would need to be privatized, driving competition and quality of service upwards, the tech introduced would give the covering agency enough visibility to track fraud if it occurs (such as over-invoicing) and kick the…
28/ …fraudster hospital out of the approved list probably bankrupting it in the process.
29/ A very tough regulatory framework should be put in place to make sure hospitals don't invest solely in "premium rewarding" services, while neglecting primary care and trauma.
30/ For instance, every hospital should have a very high quality ER operation, and trauma centers should be regulated. Facilities willing to invest in premium services (such as PET-scans) outside the capital should get tax incentives.
31/ In conclusion, we can transform our health care system, drive costs down, improve quality of services, introduce technology in every step and end up with the best sector in the region driving medical tourism substantially while providing universal care to our citizens
