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14 Health and Related Services 1 INTRODUCTION The chapter attempts to assess the extent of liberalisation and the regulatory requirements for delivery of Health services in each of the SAARC countries, i.e. Bangladesh, Bhutan, Maldives, Nepal, Pakistan, Sri Lanka and India. The specific health services that are studied are ‘Medical and Dental services’, listed under the ‘Business Services’ section, and ‘Hospital Services’ listed under the ‘Health related and Social Services’ section of the WTO Secretariat’s Services Classification list, commonly referred to as the W-120 Services Classification list. 2 The other kind of health services covered under the W-120 List are services provided by nurses, midwives, physiotherapists and para-medical personnel. These are also addressed in this chapter. This chapter is divided into four broad sections: • The first section provides an overview of the commitments under GATS that have been made by the SAARC countries. The purpose of this overview is to present the aspects that need further improvement from the perspective of further liberalisation under the SAARC framework. • The second discusses the domestic regulatory requirements that either facilitate or restrict trade in health services. The purpose of this segment of discussion is to flag areas for improvement that are necessary in the SAARC discussions on trade in health services. The discussion on domestic regulations also highlights areas where autonomous liberalisation are at a higher level than GATS commitments, and could be areas where SAARC negotiations could push for firm commitments. • The third analyses the impact of the regulatory requirements on the Modes of delivery healthcare services in the SAARC countries. • Based on the analysis above, the last section highlights the focus areas for discussions under the SAARC negotiations on health services. At the outset, the main modes of service delivery and a brief outline on the constraints and opportunities for the same in the SAARC region, are provided below: Mode 1 Cross-border delivery of health services through telemedicine can enable healthcare providers in one SAARC country to provide services to a consumer in another SAARC country. While telemedicine is slowly taking roots within countries like India, the practice of telemedicine is being attempted by a few hospitals within India, such as Apollo. 3 The government of India has also undertaken initiatives such as the on ‘Development of Telemedicine Technology’, for delivery of services within India. 4 The government of India is also reportedly considering guidelines for standardising delivery of telemedicine services. 5 This is however yet to be formalised. Cross-border services within the SAARC region have however been confined to limited instances of telediagnostic and telepathology services from India to Nepal and Bangladesh. 6 With the growth of information technology, however, there is potential for growth of Mode 1 as a mode of supply among SAARC countries. This will depend to a large extent on the mutual recognition of doctors qualified in any SAARC country by all the other SAARC countries. This aspect, therefore, needs to be taken up as a potential area for opening up in the SAARC negotiations. 1 The chapter is based on the report authored by R.V. Anuradha. 2 WTO Secretariat, Services Sectoral Classification List, MTN.GNS/W/120, 10 July 1991 http://channels.apollolife.com/ telemedicine/info/index.htm 4 http://www.spsood.com/telemedicineinindia.htm 5 http://www.mit.gov.in/telemedicine/<strong>Report</strong>%20of%20TWG%20on%20Telemed%20Standardisation.pdf 6 Ibid.
H EALTH AND RELATED SERVICES 151 Mode 2 Trade in health services via consumption abroad is typified by medical tourism especially in India. Consumers from many of the SAARC countries travel to India for specialised healthcare. There are no direct regulatory impediments for this mode of supply. However, there are factors such as lack of portability of insurance that could act as constraints. This mode has futuristic potential for growth, and commitments for facilitating access needs to be taken up in the SAARC negotiations. Mode 3 Commercial presence in health services through FDIs in hospitals and healthcare centres is an area in which there are practically no regulatory constraints in the SAARC countries. This has not resulted in any significant flow of investments within the SAARC region. Operational constraints in this regard need to be ironed out. Mode 4 Trade via movement of health service providers among countries of the SAARC region is an aspect that needs to be addressed as a fundamental component of services liberalisation in the SAARC negotiations. Most of the movement by healthcare professionals (doctors, dentists, nurses and paramedics) from India and Sri Lanka, primarily, have been to wealthier destinations in the UK, USA, Canada, Australia and the Middle- East (Hamliton and Yau 2004, Buchan and Sochlaski 2004 and Adikioli 2006). Countries in South Asia are also said to have a high degree of internal migration, from rural and backward areas, to cities (Adikioli 2006). Interestingly, however, any movement between lesser developed SAARC countries to more developed ones (e.g. Bangladesh to India), has not been mapped as yet. As with Mode 1, Mode 4 will depend to a large extent on the mutual recognition of doctors qualified in any SAARC country by all the other SAARC countries. COMMITMENTS IN HEALTH AND MEDICAL AND DENTAL SERVICES UNDER GATS The nature of GATS commitments by SAARC countries predominantly focus on Modes 3 and 4. Only Nepal has made commitments in Mode 1. All others have left this as unbound. Pakistan in fact states that Mode 1 is left out of its schedule because it is technically ‘not feasible’. Commitments on Mode 2 have been made only by Nepal and Pakistan. Despite lack of significant GATS commitments, mode 2 service delivery in the form of services to patients from other SAARC countries has been prevalent especially in India. Both Mode 1 (especially telemedicine) and Mode 2 (in the form of medical tourism) have significant potential for future growth, and this will be discussed separately in this chapter. Appendix Table A14.1 presents a summary of commitments by SAFTA member countries in health and related services. The extent of commitments under GATS by each of the SAFTA member country is as follows: Bangladesh 7 Bangladesh has not undertaken any commitments on Health and Medical services under the GATS as yet. However, as will be discussed later in this chapter, its domestic regulatory regime in fact allows for foreign participation in the delivery of health services. Bhutan As mentioned before, Bhutan is not a member of the WTO as yet, hence it does not have any GATS-related commitments. As will be discussed later in this chapter, FDI is allowed for hospitals subject to Government approval. India 8 India’s GATS schedule specifies the following for Hospital Services. Mode 1: No commitments have been undertaken. Mode 2: No commitments have been undertaken. Mode 3: Under Mode 3, India has committed to allow for foreign equity participation up to 51% in the setting up of hospitals in India. It also mandates incorporation of the entity in India for such commercial presence. Mode 4: No commitments have been undertaken. No 7 See, GATS/SC/8, 15 April 1994, available at www.wto.org 8 See, GATS/SC/42, 15 April 1994, available at www.wto.org
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Preface Our consultations with seni
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viii CONTENTS 7. Revenue and Welfar
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Executive Summary OBJECTIVE This st
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6 Impact of SAFTA on Member Countri
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7 Revenue and Welfare Implications
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8 Impact of SAFTA on Inward and Out
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APPENDICES
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Appendix 8 Intra SAARC FDI Collabor
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Appendix 11 Table A11.1 On an Emplo
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Appendix 15 REFERENCE PAPER Scope T
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Bibliography Abelson, P. (1996),
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BIBLIOGRAPHY 241 Cuba (2002), Negot
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BIBLIOGRAPHY 243 (2004), Impacts of
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BIBLIOGRAPHY 245 Silva, Patricia an
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