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Health Tech is seen as the next big thing in the Philippines

May 02, 2023
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Philippines Health Tech Market had a slow growth initially. The slow growth corresponded to poor internet penetration and a lack of technology awareness. Unorganized health tech infrastructure and a less tech-savvy population led to the accumulation of unharmonized healthcare data. The government faced a major difficulty when the healthcare challenges kept on increasing with the growing population.
But, the table is turning and the Health tech industry is seen as the big thing in the Philippines. From our exclusive report, we have brought you the key points that show how the Philippines government is continuously working towards the increasing adoption of health tech in the country. Let’s dive in!

1. The Philippines GDP was exponentially increasing till the year 2019 but then due to the pandemic, the GDP shrunk by 9.5%, the Health Tech Market was in profit due to rising investments

Post Covid Scenario-Rising Healthcare Investments

  • In April 2020, the Department of Science and Technology (DOST) developed an app that provides information on Covid-19-related research and services.
  • In light of the Covid-19 pandemic, the federal budget for 2021 – approved in December 2020 – raised the DOH’s allocation to a record P203.1bn (USD 4bn), while the budget for PhilHealth remained at P71.4bn (USD 1.4bn)2.

DOH Budget 2010--20191

chart1

Medical Provision for Filipinos

    Hospital Beds per 10,000 people in the Philippines

  • Most: 13.5 in NCR Region
  • Least: 1 in MIMAROPA Region
  • National Average: 5.3

    Doctors per 10,000 people in the Philippines

  • Most: 10 in NCR Region
  • Least: 0.8 in BARMM Region
  • National Average: 3.2
  • Total Doctors (2018): 40,775

    Nurses per 10,000 people in the Philippines

  • Most: 14.8 in CAR Region
  • Least: 3.8 in BARMM Region
  • National Average: 38.3
  • Total Nurses (2018): 90,308

Current Scenario

  • Philippines GDP was exponentially increasing till year 2019 due to the pandemic the GDP shrunk by 9.5%.4
  • Philippines suffered a major fall in total income of around 1.04 PHP Tn in 2020 or an avg. of around 2.8 PHP Mn per day.4
  • On a per capita basis, annual family income declined by some 23,000 PHP per worker, but this average masks wide differences across sectors and jobs.
  • National budget in Jan 2020 saw 12% increase from 2019’s budget, and allocated 164.7 PHP Mn for the health sector2 whereas the 2021 saw merely 1% increase.6

Healthcare Infrastructure, 20195

    Total Population 109,619,100 (July 2020)6
    No. of Doctors (Licensed Doctors) 1,30,000
    No. of Hospitals 1,224
    Rural/City Health Centres 2,587
    Village Health Stations 20,216
Source: 1. DOH-Annual Report 2019 2. PSA-Philippines 2019 3. Index Mundi demo graphs 4. Business world Article-2019 5. Philippines Healthcare Overview 2018 6. Local newspaper
Note* DOH-OSEC: DOH Office of Secretary PHA-Public Health Associates HRH: Human Resource for Health Philippines

2. However, there are still many factors that hinder the growth of the Health Technology sector in Philippines

Health Care Parameters

Household Final Consumption Expenditure on Health increased at a CAGR of 7.4% during 2014-2019

chart2

Major Causes of Death from Diseases

    Diseases Number of Death FY’171
    Ischaemic Heart Disease 800-1000 Deaths
    Neoplasm 800-1000 Deaths
    Cerebrovascular Disease 600-800 Deaths
    Pneumonia 600-800 Deaths
    Diabetes Mellitus 200-400 Deaths
    Hypertensive Disease 200-400 Deaths
    Chronic Lower Respiratory Infections 200-400 Deaths
    Respiratory Tuberculosis 200-400 Deaths
    Other heart Diseases 200-400 Deaths
    Remainder of diseases of the Genitourinary Less than 200 Deaths

Factors affecting Health Technology sector in Philippines

chart3
chart4
  • World Bank reports 40 Internet users per 100 people in the Philippines.
  • Philippines is remarkable considering the reported constraints of low download speed.
  • Among 22 Asian countries surveyed, the Philippines has the second to the lowest Internet speed.
  • Health-care information technology spending in the Philippines was reported at $52.4 Mn in 2015.2
  • Estimated annual growth rate of 4% is projected in health-care information technology.2
  • Hospitals accounted for 88% of the total health-care information technology spending.
Source: 1. IndexMundi-2017, Ken Research Analysis 2. Philippines Healthcare Review 2018 3. Statista-2020

3. Also, proper implementation of eHealth is a major concern for the Philippines Health Tech Market

Pain Points

    E-Health Implementation Challenges
  • Data Privacy and Cyber security regulatory framework, coupled with the limited IT capabilities and geographic landscape, makes rolling out eHealth system difficult.
  • Lack of clarity in the rules discourages foreign market due to civil fines and penalties.
  • Current IP laws and regulations may not provide full protection, as software is generally not considered a patentable invention.
    Unharmonised Data
  • Health data coming from disparate systems use differing formats, lacking harmonization, and compromise data quality.
  • Poor recording, processing and transfer of data from rural health units to govt. office takes >1 yr with data validation at various levels.
    Unorganised and Inefficient Infrastructure
  • 2 Major challenges in Philippines mHealth/ eHealth adaptation include,
    1. Technology Barriers
    2. Complexity & Weak Infrastructure
    3. Poor Interface Design

    1. Organizational Barriers
    2. User Resistance & Lack of Appropriate Skills
    3. Expensive Installation : EMR Solution for 100 bed costs around 4-5 Mn Pesos per yr plus hardware charges.

Solutions

    Compatible integration of Health Tech system
  • Philippines government must think of a way to systemically implement the changes while maintaining the integrity of the system.
  • Clarifying foreign equity restrictions to ensure that mHealth operators show keen interest in the emerging market.
    Government Initiative to improve E-Health
  • National eHealth Systems and Services Act was approved for the delivery cost effective health services through secure information and ICT.
  • It covers infrastructures, standards, rules and protocols for the effective implementation.
    User Centric Solutions
  • Health IT solutions are majorly affected such as Use EMR solution.
  • User-centered design that addresses these concerns can be inculcated by the providers such as Pharmacy Solution by m-clinica addresses operational efficiency of local pharmacies.
Source: Local News Articles and Research Papers of Philippines Health Tech Industry, Ken Research Analysis

4. Still, Philippines market show a potential to have seamless entry of technology and reach double-digit growth in the future

Expanding Infrastructure

  • Development in the country & the rapidly maturing wireless cellular network will help this industry grow.
  • Philippines is witnessing faster internet penetration. As adoption increases, scope for health tech solutions would also increase in the coming years

Healthcare IT Solutions

  • Large unorganised and unharmonized data has be arranged in order to get a valuable insight of the industry.
  • Government is focussing to make the best use of eHealth market in a cost effective way to help the decision makers.

Home Healthcare

  • Filipinos have adopted home healthcare services rapidly during the pandemic.
  • Home healthcare market is in its initial stage and ready to boom in the coming days.
  • Industry could witness e-health solutions in this segment as well.
  • AIDE is its major competitor.

Appointment Booking

  • Country suffers from alarming doctor shortage of (1 doctor per 33,000 people).
  • Appointment booking platform has been saving time and proved to be beneficial during the covid-19 times.
  • The sector is currently growing with very few players in the market.

Online Consultation

  • Health information was text based mostly, since most healthcare personnel used basic mobile phones.
  • Due to Covid-19 the use of internet based health information is increasing by 44% of people.1
  • The platform also helped Filipinos deal with internal issues such as increasing traffic in the cities.

E-Pharmacy

  • Local Pharmacies are partnering with online consultancy firms or independently switching to online presence due to the growing demand. Online purchases were increased by 22% among people.1
  • Online platform has helped the pharmacies to understand consumer pattern and have better insights about the local sales.
Source: Ken Research Analysis, Interview with Industry Experts from Philippines Health Tech Market 1. World bank-Philippines Digital Economy Report-2020

5. Moreover, Philippines’ government have been proactively updating tech to keep citizens informed, educated, and updated and push the Health Tech market in the country

Goals
  • National eHealth Systems and Services shall deliver health services through cost-effective and secure information and communications technology (ICT).
  • Seeks to utilize ICT to deliver health services which has the potential to be profitable, improve quality, change the conditions of practice, and improve access to healthcare, especially in rural and other medically underserved areas.
Govt. Bodies Involved
  • DOH, DOST Collaboration, Phil Health, University of Philippines Manila and Commission of higher education.
  • Sectors covered under program include Health IT solutions such as EMR, Telemedicine and E-Pharmacy.
Motive
  • Two main challenges of the Philippines’ health system are,
    1. Access to health care services
    2. Access to real time information for decision making
  • 70% of the population living in rural areas are still struggling with no or limited access to quality inpatient and outpatient care services.
Limitations
  • Real work will lie in the establishment of the necessary foundations – infrastructures, standards, rules and protocols for the effective implementation of eHealth services, processes and solutions.
Future Expectation
  • Widespread of healthcare services, health information, and securely share and exchange client’s information in support to a safer, quality health care, more equitable and responsive health system for all the Filipino by transforming the way information is used to plan, manage, deliver and monitor health services.
Source: ehealth.doh.gov.ph & Health care IT news-Jan 2019
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