Report Release: HealthCLIR Pilot Diagnostic - Philippines

The U.S. Agency for International Development BizCLIR project is pleased to announce the publication of the “HealthCLIR Pilot Diagnostic: Philippines” report. This report contains the final analysis from the pilot-test of the Health Business Climate Legal and Institutional Reform (HealthCLIR) business environment diagnostic tool. HealthCLIR is a tool that rapidly identifies legal and institutional barriers to effective private sector participation within a country’s health system. The HealthCLIR Philippines assessment activity applied this new tool to identify barriers to private sector participation broadly throughout the health system within the context of the government’s FOURmula One for Health strategy.

The Government of the Philippines has demonstrated an interest in business environment improvement for the health sector. The Department of Health desires to engage the private sector on endemic issues such as low investment in health infrastructure in certain regions, inequitable distribution of health services, and high drug and medical device prices. Despite government engagement, significant constraints remain to private sector participation throughout the health system.

Broad devolution of regulatory and budgetary decision-making to the local government units has created redundant, and sometimes contradictory regulations across municipalities, creating barriers to effective private sector participation. Drug and medical device supply chains are constricted by extraordinary horizontal integration at nearly all points along the supply chain, with the lack of competition increasing costs for health products. Thirty years of economic development strategy centered on exporting talented medical practitioners for remittances has proven effective, yet has taken a toll on the incentives for local medical practitioners who remain. These issues, and many others, were identified through over 110 meetings with key stakeholders across the Philippines over a two-week period, and are discussed in greater detail in the report.

The report provides the Government of the Philippines, local stakeholders, the USAID Philippines mission, and other interested parties with an in-depth appraisal of barriers for private sector participation, as well as actionable reform activities to address priority constraints. The HealthCLIR Philippines pilot diagnostic identified 58 distinct reform opportunities, ranging from short-term, immediate impact activities to strategic, yet transformative opportunities for sustainable impact. If a reform agenda can be developed through meaningful dialogue between the private sector, public sector, and regulatory institutions, the Philippines can serve as a role model for health business environment reforms throughout the region.