Newswise — WASHINGTON — What if private companies could obtain some coverage to protect their foreign investments in developing countries against crippling infectious disease outbreaks such as Ebola?
The possible path to offering disease outbreak guarantees is an idea being posed by two global health researchers who suggest that a mechanism for establishing such an instrument could be tied to public health investments.
Writing in the Journal of Health Care Finance published online today, global health science and security expert Rebecca Katz, PhD, PhD, an associate professor in Georgetown’s School of Nursing & Health Studies, and Richard Seifman, JD, MBA, an international health consultant formerly of the World Bank, say there is a circular relationship between foreign investments and the ability of a country to fight an infectious disease.
“Foreign companies may be wary of investing in a location that lacks the capacity to mitigate the consequences of disease or exposes workers to dangerous pathogens,” write Katz and Seifman. “Yet, many nations lack the resources to build sufficient capacity to prevent, detect and respond to disease without sufficient investments and improve economic status.”
Katz and Seifman propose a solution that would incentivize potential investors while at the same time encourage development of public health systems to prevent, detect and respond to outbreaks.
The two propose that guarantees to potential external investors be provided through an existing mechanism called the “Multilateral Investment Guarantee Agency” (MIGA), part of the World Bank Group.
MIGA is designed to guarantee private investors concerned about risks, which impact the decision of whether or not to invest. The researchers say its Articles of Establishment provide flexibility in interpreting what these risks might be and in calculating the premiums required for coverage of such risks.
“We are trying to propose innovative methods to incentivize the development of the public health infrastructure to prevent, detect and respond to infectious disease threats,” explains Katz. “We think MIGA might be one way to do this."
Katz and Seifman suggest that such an innovative mechanism would significantly induce the beneficiary country to take reasonable steps to establish the core elements of a public heath system (“core capacities”) set forth by the World Health Organization’s International Health Regulations. This part of the MIGA Agreement would be reinforced by a “breach of contract” clause.
“There is much work to do to explore the possibility of expanding MIGA coverage to deal with public health emergencies, but public health emergencies are here to stay, the public sector cannot do it alone, and the external private sector has much to lose or gain, depending on what core capacities in health are in place,” conclude the authors.
About Georgetown University Medical CenterGeorgetown University Medical Center (GUMC) is an internationally recognized academic medical center with a three-part mission of research, teaching and patient care (through MedStar Health). GUMC’s mission is carried out with a strong emphasis on public service and a dedication to the Catholic, Jesuit principle of cura personalis -- or "care of the whole person." The Medical Center includes the School of Medicine and the School of Nursing & Health Studies, both nationally ranked; Georgetown Lombardi Comprehensive Cancer Center, designated as a comprehensive cancer center by the National Cancer Institute; and the Biomedical Graduate Research Organization, which accounts for the majority of externally funded research at GUMC including a Clinical and Translational Science Award (UL1TR001409-01) from the National Institutes of Health.
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Journal of Healthcare Finance