Why social enterprise could be the cure for ailing medical sector

Patients at a hospital in Mombasa. FILE PHOTO | NMG   

By STEVE ADUDANS

When Kenya announced the Universal Health Cover initiative, many thought that a cure to the...
ailing health sector was actually in the offing. Whereas a stressful implementation could be a game changer in health care provision, there have been a number of roadblocks along its path.

Doctors and nurses are ever on the streets over pay and working conditions, most hospitals lack basic equipment, National Hospital Insurance Fund has been dogged by one scandal after the other and the leadership admits that it can not provide the services its is mandated to offer adequately. The middle class who can afford to pay for private medical cover have been exploited by unscrupulousness health facilities who, in their zeal for profits, have inflated costs, leaving their covers exhausted half way into the year.

What this means is that other than the missing out on opportunities to save life, the economy is missing out on the man-hours the patients and the care-givers spend moving up and down in their effort to get quality treatment in and out of the country.

We need a paradigm shift. Social entrepreneurs could be key in health care development and improvement.

Social entrepreneurs are changemakers who apply their business acumen in social initiatives to improve the lives of others. They are not charities in the sense that they do not simply provide temporary relief. Rather, they leave a lasting impact on the disadvantaged by creating sustainable social ventures rather than economic returns, is the yardstick for the success of the Social entrepreneur’s programme.

My argument is informed by experience, having worked in a social enterprise HewaTele. An organisation which partners with public hospitals to provide low cost medical oxygen . There are key lessons we can learn from the initiative.

First, there is a great and growing interest in investing in healthcare, for several reasons . There are multiple reasons for this, including a growing middle class with an increased willingness and ability to pay and better technology and access to information. Multinational companies also see emerging markets as growth opportunities, and high-income country “medical elite” see opportunities to spread capabilities and capacities.

Secondly, there is a financial gap in the sector that is ripe for impact investors. Currently, there is a lot of focus from donors and grant providers on rural populations and the “bottom of the pyramid” (BOP). There is also traditional private equity and debt seeking high returns from urban and suburban high-income populations. In between is a gap where both BOP and middle-class populations can be addressed via debt and equity investment models. In particular, low-margin, high-volume models for the BOP and higher-margin models for the middle class could be particularly suitable for social enterprises that could balance return and impact.

Market-based business models can address some of the issues of health care delivery and ease the burden on the public sector. However, government and philanthropy need to focus on providing the proper support for social enterprise to thrive.

The writer is Executive Director, Centre for Public Health.