“Health is wealth” is perhaps the easiest proverb to remember for life.
At the World Economic Forum in Bangkok, there is a renewed push by business leaders and policymakers to remind everyone of the importance of this maxim, for individuals as well as for overall economic growth.
Despite being home to some of the fastest-growing economies in the world, the region is lagging behind in healthcare after years of insufficient investment.
“If you look at the healthcare spend in most countries in Asia, the stories are quite telling because majority of them are in low single digits,” says Malvinder Singh, executive chair of Fortis Healthcare.
This has resulted in inadequate infrastructure that has created a big gap between supply and demand, which in turn threatens economic growth.
“If we don’t address it and deal with it, we are not going to be able to achieve the desire or the vision that we have,” he says.
‘Most important resource’
The fear is that inadequate healthcare facilities increase the risk of medical problems not being diagnosed and treated properly, thus developing into major health issues.
While there are concerns about the impact of these issues on the health of the individual, they also have a bearing on the overall economy in two major areas, namely productivity and rising costs.
In terms of productivity, the effect is at two levels.
Firstly, when people develop major health issues they need time off work to recover.
So either the overall output of the firm where they work will fall, or the firm must pay for a replacement worker, which in turn increases its costs.
The other risk is that people may come back to work without having received proper treatment.
This is equally harmful, as even though they are physically present, their contribution to output may be limited.
The World Economic Forum and Harvard School of Public Health have forecast that non-communicable diseases, which include diabetes and chronic respiratory diseases, may result in a “cumulative output loss” of as much as $47 trillion (GBP 30 trillion) globally over the next two decades.
Much of that is of that is expected to come from Asia, which is home to more than half of the world’s population.
Investing in healthcare may put short-term strains on a country’s finances, though it should bring significant benefits in the long run.
“Human capital is the most important resource,” says Hu Bo, chair of Beijing-based Ciming Health Checkup Management Group.
“Proper health of human capital is necessary for any kind of economic growth to take place in any country.”
An inadequate healthcare system also results in much higher costs in the long run.
This is a big concern for the Asian economies, where 40 percent to 60 percent of the health expenditure is paid by individuals.
If they are not provided adequate care and medication, their health problems may escalate, and so they will need more expensive specialised treatments.
The direct impact of that is on the spending power of consumers, as they cut down on other non-essential spending, at a time when many Asian economies look to boost domestic consumption.
Higher healthcare costs for Asia’s millions of poor also threaten efforts to increase their real income levels and raise living standards.
“Out-of-pocket payments associated with poor health status and use of health services” has impoverished millions of people in Asia, according to the World Health Organization.
Threat to opportunity
There is some good news though.
Many firms come up with innovative products and ideas to cater for growing demand for healthcare products, especially from the rural areas in the region.
GE, one of the world’s biggest manufacturers of medical equipment, has introduced a portable ultrasound machine.
The machine can be taken to check patients in areas that do not have specialist hospitals, or where people may not be able to afford the cost of travel to urban centres for check-ups.
“Our approach to rural healthcare is to create more affordable and portable devices that will allow us to do basic diagnosis and detect health problems,” says Stuart Dean, chief executive of GE for the Asean region.
Another firm looking to tap into the sector is Novartis.
The drug maker is playing a key role in facilitating the development of “micro-pharmacies” that help in distributing basic affordable medicines, including generic drugs, to people living in villages and rural areas.
There are now almost 250 of these in India, catering for more than 40 million people.
The firm is looking to spread the concept to other countries in the region.
It says the idea to set these pharmacies was to do “social good”, but admits that given the number of people living in rural areas, the project could help improve its profitability in the long run.
“Nobody knows yet,” says Avinash Pramod Potnis, chief executive of Novartis Corporation Malaysia. “The potential could be enormous.”