When I speak to GE team members in Africa in the healthcare space they always mention Kenya as a blueprint and one of the key achievements in the past couple of years. Can you tell us a little bit more about your operations in Kenya?
when I joined GE and supporting healthcare particularly in Africa I realised going through side-by-side hospital’s diagnostic centres, which have a fragmented kind of market for a business term, I regularly saw that governments set plans for their infrastructure, modernisation or infrastructure enhancement, but they were lacking a few key ingredients to make the equation sustainable.
So, if you go to public hospitals in most of the countries in Africa – although it’s not specific to Africa alone – you would see a whole lot of technology equipment, particularly diagnostic imaging, you would see CT scanners, ultrasound machines monitoring in very sensitive areas like ICUs or operating rooms, x-rays, basic x-ray machines, that are just sitting there idle.
So the procurement of this equipment was done on a pure bill of quantity, and nobody thought in terms of how are we going to service and maintain this equipment over time, who are the users in this hospital that are going to be able in the next ten years to utilise the equipment and the technology to make sure that it delivers the clinical outcome to patients on an ongoing basis.
So this was the issue in Africa at the time I joined GE and the countries were definitely not getting the outcome that they expected and it didn’t make the equation sustainable.
So what we did in Kenya is all about this and we didn’t do it alone, we did it in partnership with a Ministry of Health at the time and the government. We looked at the bigger picture because you need really, when it comes to a national plan, to engage and understand that something needs to change in the way we look at public healthcare, infrastructure, development and clinical outcome.
The world has been doing Managed Equipment Services in other countries, particularly in Europe and in Canada. It is basically a form of PPP that puts together a comprehensive plan with the supply of technology and equipment combined with an embedded type of provision for service and maintenance.
They also train the users and a form of project finance, which is a kind of PFI or at least type of long-term funding, and in effect shifting from the traditional procurement that leads to huge Capex upfront to an Opex type of payment obligation for the customer.
And so with GE entering the African market we are able to deliver over seven years’ worth of both the technology, supply and installation, training and skills development of the users and service and maintenance, with stringent obligations on us to deliver 90% uptime at any given time on our machine.
So, what you were seeing in the past where machines stand idle is no longer possible in a contractual framework like this one anymore, and providing the project and structured financing that I’ve just mentioned, in this case in Kenya, will start with two banks, Standard Bank and Rand Merchant Bank both from South Africa. So that’s really what we’re trying to alleviate.
To date, we have completed our work in 98 hospitals in 47 counties, so for us that’s been truly meeting our targets because we went from something that was absolutely not sustainable to a model that is really much more sustainable and delivering consistent clinical outcomes to the patients in Kenya and, hopefully in the future, throughout Africa.
What about increasing the skillset of medical professions. How important is it and what have you done to achieve this goal?
I think that’s a key component because of most of the time, and with things at a different level of the continuum of care in Africa, whether it’s primary, secondary and tertiary, there is a gap in terms of skills development and the ability of users. So, We’ve set up a full-fledged healthcare institute that we called the GE Healthcare Institute and that is designed to be training radiographers, radiologists and also biomed engineers in the next decade at a minimum, and hopefully in the next two decades.
We have a commitment to train about 10,000 healthcare professionals over the next three years, which in itself would be quite breakthrough because I don’t think, looking at Africa, that companies like GE have been really committed to invest, and in this case it’s about $30m in building that large-scale training centre devoted to healthcare professionals. We intend for this healthcare institute to serve the public sector professionals but also and more importantly we believe in the development of the private sector in any of those markets and we are already working with some private customers for their staff and future staff to be trained in that institute.
In terms of the landscape, the healthcare landscape in Africa and the healthcare solutions that you can offer within Africa where do you fit in?
If you look at the landscape of Africa, first there is not one Africa in terms of the provision of healthcare today, of the standard, the quality of the healthcare being provided from one country to another, it’s very different and I would say we try and cover it all within the continent. If you go from what I said about the healthcare infrastructure there is probably a lot to be done in terms of, and that’s where we come into play, in terms of making sure that the infrastructure, the technology, the ability to provide the right diagnostics is there. And, as I said in many of the countries in Africa in the public sector they lack that level of infrastructure, so we are focussing on working with the government to make sure that we get to a level of healthcare infrastructure is to the standards that will allow service to patient to be delivered, so that’s one piece where we can make a huge difference.
The second one is about access. We can always have the best technology laid on the ground in hospitals or diagnostic centres in Africa, but if people continue not to have financial access to these facilities we will still not have resolved the problem. Therefore, it’s about collaborating with the government on the universal health coverage and the national insurance scheme that they’re developing and in most of the countries there is an initiative to that. Different countries have different levels in terms of achieving that aim, that this is something that from a system building standpoint we want also to play a role with the government, helping them to get there.
Then last but not least is about business model innovation and I’ve touched on it, you know the Kenyan experience is one, but I could give you another example of what we’re doing currently in Africa around primary care, because one of the other burdens of healthcare in Africa is the infrastructure. In some countries it is not at the right level but it’s also the referral system that is broken, so most of the population, especially in the rural areas, do not have the possibility to go to a primary care centre and people will just either stay in their communities and do not get the level of care that they need. So the only way to alleviate this situation is to really strengthen the primary care level.
And for us what does it mean? Well at primary care level where we as a commercial company need to do business at the end of the day, while solving some of the most daunting healthcare problems in the world, will have to build new models around where healthcare is needed.
And at primary care level, we basically built a model that’s a little bit similar to what we did in Kenya at the district level where we bring together technologies that are relevant and that can be accessed by even the most rural person.
For example, having a portable ultrasound can have a huge impact on maternal and infant mortality but also early diagnostic of maternal and infant care affection.
If you combine as well some of our very affordable technologies around monitoring and anaesthesia you can build safe surgery at a primary care level so that when you have they a complication in a pregnancy and a woman is referred to that there can be a c-section done, it is not in an emergency room at a hospital that the woman would not reach on time.
And the healthcare space for GE in terms of Africa, the revenues for GE in Africa are smaller for what they are, for example, in China or in India. Would you like to see more percentage of their revenues of government spend on healthcare?
No, I agree. If you look at the percentage of GDP dedicated to healthcare, it’s still regrettably small in many countries. Although I would say, you’ve got a few countries in Africa that it reaches the level of 6% and above, which starts to be meaningful. But, beyond the percentage of GDP dedicated to healthcare, I think what we’ve learnt in Africa is how to use these dollars more efficiently. We’ve worked out how to optimise the use of these dollars to make the biggest impact on the healthcare being delivered to your people, to your patients. Also, don’t forget that in Africa, it’s not only about the budget of these governments going to healthcare, it’s also a huge amount of dollar and NGO funding on multilateral that goes into African healthcare every year, which is about $8bn per year of overall.
When I spoke to members of the other business units, they all mention the importance of the digital aspect within GE. You are now a digital industrial company. So how does technology and the digital world, so to speak, impact healthcare in your particular division?
So that’s indeed a big theme and it’s really of paramount importance for us going forward. So within GE healthcare we’ve built a specific digital platform around health. The idea has been implemented for emerging markets in Africa, and it is going to be able to bring digital solutions that alleviate some of the burdens that were just mentioned. I’ll go through some of them.
In some African countries, over 70% of the population lives in rural areas. So it’s not about bringing patients to urban areas, and high-tech centres, it’s about bringing digital to the rural areas. So by enabling some of our technology systems to be able to, for instance, transmit images to a centralised reading sensor where we’ve got global expertise in terms of reporting and reading a diagnostic imaging. So that’s one – digital, enabling the problems of localised skills and expertise to be sold. And that’s a huge one for Africa.
We also use digital platforms to train and develop skills in a more efficient and sector basis and today we have the ability to include within our technology into the most rural areas and remote areas. Digital solutions will help us train remotely all kinds of healthcare professionals from midwives, to nurses, to radiologists and enhance the level of skills for these healthcare professionals.
Digital platforms are also about being able to do remote maintenance, even in the most remote rural areas, without ever sending anyone on the ground.
So yes a big bet in terms of healthcare and a big bet for GE because with our digital and our predict solutions, we have the ability to really be disrupters; which means that needs to help to build a new model that I just mentioned to you on primary care and the continued care that I mentioned earlier during this discussion.