Latin America – is the traditional healthcare model in need of change?
The low penetration of health insurance in Latin America, along with lack of awareness and high medical inflation, has had a debilitating effect on the region’s healthcare system. With a few exceptions, the region has witnessed a double digit increase in medical inflation, stemming primarily from the increased cost of hospital supplies and medications, particularly those related to the treatment of cancer, respiratory, cardiovascular and gastrointestinal illnesses, as well as other diseases linked to obesity, stress and hypertension.
Pan-American Life Insurance Group, a MAXIS GBN member in Latin America, recently published the first of an annual series which aims to offer an outlook of healthcare market trends in Latin America. The study, ‘Personalized Healthcare: A Growing Opportunity’, analyses the state of the private health sector within the region and documents the importance of moving towards a personalised healthcare model, centred on primary care that actively promotes comprehensive health and disease prevention, and where all stakeholders are aligned – consumer, medical provider, public and private sectors - and most importantly, have a model that is sustainable over time.
Based on the analysis documented in this study, there is an indication that the existing healthcare system in Latin America is not sustainable given the high prevalence of benefit overutilisation and the singular focus on disease treatment versus disease prevention and health promotion. This opens the door for a new model to emerge – one with:
- better quality control measures to standardise a higher quality of care
- an improved balance between healthcare costs and the value they deliver
- physicians and hospitals that are encouraged to proactively participate in helping their patients reach and maintain optimal health.
A new, more personalised healthcare model also helps to educate consumers about their medical expenses and ideal cost vs. quality ratios so that they can make informed decisions about their health. In turn, this will push providers to become more transparent with regards to the expenses they charge for their services. Additionally, insurance providers will be encouraged to find alternatives to the traditional model that centres on reducing benefits and increasing premiums to overcome high loss ratios.
Healthcare in Latin America is at a crossroads and there is a real opportunity to embrace solutions that have already proven successful in other markets in order to create a model that is genuinely focused on good health.
To read the full report in English, please click here.
To read the full report in Spanish, please click here.