HSPH, HBS students team to develop health-care model for women’s development organization in Mexico
July 12, 2011 — “Poverty and poor health perpetuate each other,” said Callae Snively, a student and SM’12 candidate at the Harvard School of Public Health (HSPH), on May 2, in Hawes 202 at the Harvard Business School (HBS), articulating one of the basic tenets of Project Antares. She was introducing her team from Project Antares, a unique semester-long course and field experience that brings together graduate students from the HSPH and HBS to develop commercial self-sustaining health-care initiatives to better meet the health needs of low-income populations and simultaneously address one of the drivers of poverty.
In Mexico, where Snively’s project was based, the government provides comprehensive public health insurance, but still some 50 percent of health expenditure is private, an indicator that existing public services are not meeting people’s needs. That leaves “high opportunity,” she said, not only to provide better, more convenient, or more desirable health offerings, but also to generate income by doing so. “Preventive health care, in particular, is underdeveloped,” she told the small but rapt audience. “This is the gap our Project Antares team aimed to target.”
Snively, with her five teammates, was presenting the group’s market study for Pro Mujer Mexico, one of Pro Mujer’s five country operations. Pro Mujer is a non-profit, women’s development and microfinance organization that empowers women in impoverished communities throughout Latin America. Founded more than 20 years ago, Pro Mujer offers women a holistic package of services that includes microfinance, business and empowerment training, preventive health education and high-quality, low-cost primary health care. This is the fifth year of Project Antares—co-directed by Michael Chu, Senior Lecturer at HBS, and David Bloom, Clarence James Gamble Professor of Economics and Demography at HSPH, and the fourth year it has worked with Pro Mujer.
The lively exchange between the presenters and the audience, which included Roslyn Payne MBA’70, the Project’s primary donor who flew in from California for a few hours to attend, sparked new ideas and drove home to the students the significance of “context”: That what might work for Pro Mujer Mexico would not necessarily be right for Pro Mujer’s other locations, in Peru, Bolivia, Nicaragua, and Argentina.
Step by step, the team laid out a cogent framework, highlighted by various “filters,” to arrive at the most needed and commercially viable health interventions that Pro Mujer could offer its Mexican clients, who already receive the organization’s products and services.
“We wanted to utilize out-of-the-box thinking to create an initial exhaustive list of health-care interventions,” said Snively. The list comprised 45 interventions ranging from vaccinations and urine lab work to Pap smears and ultrasounds. The team then ran the list through two filters: one, to find the interventions that Pro Mujer clients saw as having the most value, and two, to identify those interventions that would have the greatest “health impact” for Pro Mujer’s clients. As HSPH Dean Julio Frenk suggested to the students, the concept of “health improvement” can be better captured by considering the greatest “potential health gain” for the target population.
The team used client surveys to determine perceived value and willingness to pay, and a DALYS (Disability Adjusted Life Years) analysis, which calculates lost years of “healthy” life, to determine health impact. On a carefully color-coded graph, the students revealed the 14 interventions that didn’t pass muster, and the 31 that did, distributing the latter into four categories ranging from “ideal” – “a win-win situation in which the intervention would have both a high health impact and a high perceived value,” said Snively— to “not a priority.”
“You want to get at the perceived value because, at the end of the day, you want a commercial impact—something the clients would actually pay for,” said Chu.
With the filtered intervention list in hand, the team turned to a market analysis: Which interventions would be the most profitable and sustainable for Pro Mujer Mexico from a business perspective?
To answer this question, the students considered both quantitative and qualitative factors: the current market size of each intervention, the rate at which that market had grown over the past five years, and through surveys to 367 clients, the degree of satisfaction clients felt with the accessibility and affordability of the alternatives currently available to them. Pointing to a graph with colorful diamonds representing the four categories developed earlier, Jose Hartasanchez, MBA ’11 noted the huge market sizes of interventions like brand-name and generic drugs (“to be expected,” he said) as well as urine- and blood-lab work, dermatology, vision care, and ultrasound.
The bar graph delineating client satisfaction showed that even the highest-ranked intervention —basic diagnostics, including glucose monitoring, blood pressure, and body mass index—fell far short. “The first takeaway of this graph is: There’s no intervention that the clients perceived that they were highly satisfied with,” said Hartasanchez. “The satisfaction gap is big for all these interventions going forward.”
And a big gap, he pointed out, meant huge opportunity for Pro Mujer—albeit, in areas that are not already saturated, such as childhood vaccinations, which are broadly and easily available through the public sector.
One filter remained: How the list of potential interventions—those with a big, growing market and low satisfaction and availability of existing alternatives —fit with Pro Mujer Mexico’s capabilities. It’s important to remember, said Pablo Salazar MBA ’11, that Pro Mujer doesn’t offer health care in Mexico. “So for most of the interventions, the capabilities are not there yet,” he said. “The key questions become: How easy is it to acquire those capabilities? And which interventions does Pro Mujer’s comprehensive business model best fit with, giving the organization a competitive advantage?”
Recognizing that a great strength of Pro Mujer, in addition to its convenience for clients of receiving health care at Pro Mujer’s neighborhood centers which they already frequent, is its strong relationship with its clients, the team wondered: Which interventions played to that trust and also appealed to the greatest number of clients?
Combining the results of all the filters, the team transformed the colored diamonds showing the interventions’ perceived value and health impact into bubbles of varying sizes indicating market attractiveness (the bigger the more attractive) and dropped them onto a graph plotting Pro Mujer’s capabilities against how the interventions fit with the organization’s business model.
The team next analyzed how to bundle the top-ranked interventions with less costly ones to add value (“economies of aggregation,” in Dean Frenk’s phrase). Pro Mujer could then develop an insurance model that offered the bundle to all family members, lowering costs and increasing usage. And it revisited interventions that Pro Mujer could offer through partnerships with private providers.
Gabriela Salvador, MD, MPH ‘08, Pro Mujer’s Director of Health and Human Services (and a member of the first Project Antares team to work with Pro Mujer to analyze Pro Mujer’s health operations in Bolivia, Peru and Nicaragua) provided a refreshing dose of on-the-ground reality. She was reluctant to give up on an intervention with the capacity to generate much-needed revenue that could be reinvested into other health care initiatives. “When you talk about partnerships, you are letting go of that percentage of the sales you could use for something else, such as subsidizing preventive care,” she said. But this opportunity needs to be realistically assessed against costs and competition. Then she noted that the question that needs to be figured out is, “What would make Pro Mujer different?”
The final step, said the students, would be to give Pro Mujer a financial method to evaluate how profitable the bundled offerings will be. For that they would need actual costs for equipment and personnel as well as pricing of services.
In the end, the Antares team provided more than an answer to the question of what health services Pro Mujer could profitably offer its clients in Mexico, but a tool that would let it develop the answer to that question over time and in different locations and respond to varying contexts. “That tool,” said Salvador, “will be priceless to us. We are so thankful you took on this challenge.”