Good eHealth needs a hand from telecoms

To enjoy the full benefits of digital technology in health care, governments need to work closely with private-sector companies.

Many GCC governments do not have the expertise to fully implement and capture all the benefits of eHealth programmes. Court Mast / Bloomberg News

Health care remains a stubbornly analogue industry in a world where digital technology has created so many improvements.

The digitisation of health services through new information technologies - broadly known as "eHealth" - has the potential to dramatically improve the healthcare experience for patients.

In Canada, a national electronic healthcare programme is projected to offer gross savings of more than US$80 billion (Dh293.84bn) over a 20-year period. In Saudi Arabia, the national electronic health record could save the country in excess of $30bn a year, with healthcare payers and providers benefiting most. While these programmes typically require a substantial upfront investment, they deliver value over the long term, with cost advantages that grow as more people join the system.

Despite such advantages, eHealth programmes are complex and require a number of different capabilities, and many GCC governments do not yet have the expertise to implement them and capture all the benefits. These ventures call for extensive technological expertise and capabilities in highly specialised fields such as coding, standards and system integration and interoperability. The implementation process lasts for years and requires substantial investment from governments. Canada launched its national initiative in 2001 and implementation continues today.

Germany's health electronic card initiative began in 2005 and is still unfinished, although the programme's focus has changed. These less-than-ideal outcomes are partly the result of governments being ill-suited to implement such large-scale, technically challenging programmes.

Private-sector players, particularly telecommunications companies, can help.

These companies are uniquely positioned to partner strategically with government health authorities to develop national eHealth programmes. Telecoms companies possess existing out-of-the-box national connectivity infrastructure, extensive programme management and customer-care experience. They also have the technical, financial and human capital capabilities necessary to support governments in these initiatives.

One form of collaboration is the public-private partnership (PPP), which lets governments retain control of the regulatory burdens while offloading to private-sector players the financial and operational risks of building and maintaining the necessary systems. PPPs are frequently used in large-scale infrastructure projects, although they have been increasingly applied to health care as well. The United Kingdom, Portugal and Greece all used PPPs to create national healthcare programmes.

And as the world shifts to digital technology, telecoms companies are increasingly the focus of health-related PPPs as well. In Italy's Lombardy region, the government entered into a public-private partnership with telecoms operators and other private-sector players to launch a national health and social services electronic card. In the Middle East, Etisalat signed a strategic memorandum of understanding with the Health Authority - Abu Dhabi to jointly develop innovative eHealth services.

While this partnership offers clear benefits for governments, the eHealth opportunity makes sense for telecoms operators as well, given the current challenges in their market. Legacy phone services are being steadily commoditised, with eroding profit margins.

Digitisation programmes such as eHealth now represent the next big wave for growth - a new way for telecoms companies to leverage their existing infrastructure and capabilities. In addition to immediate revenue gains, eHealth ventures create several other benefits for telecoms companies.

For example, they generate captive demand for their broadband infrastructure investments, in the form of a national customer base that will last for years, potentially decades.

These initiatives also give telecoms companies the inside track on developing other digitisation opportunities for the public sector in their local market or abroad. (These opportunities include eGovernment, likely to be a growth area in the Middle East over the coming years.) And these programmes offer telecoms companies a way to capture and retain share in the growing IT-services market.

So the future of eHealth is collaborative. These programmes offer substantial benefits for all stakeholders in the healthcare ecosystem - specifically patients, providers and payers.

The significant and long-term investments at stake, as well as the required level of technical expertise, mean that governments will increasingly need to partner with the private sector to make their eHealth ambitions a reality. For telecoms operators, this is a genuine opportunity to apply their capabilities to a new market.

Bahjat El Darwiche is a partner, Jad Bitar is a principal and Nikhil Idnani is a senior associate with Booz & Company