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Week of 8.22.08
Transcript: Health Care SolutionsMore From NOW:
Health Care Solutions |
One Kenyan's Story: Care Amidst Chaos
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BRANCACCIO: We'll be taking a high dive into domestic politics with the conventions starting next week...but before the summer is out, come with me for a look at a pair of achievements in the crucial area of global public health. We start with this odd proposition: can healthcare in the third world be transformed by the principles of—get this: fast food franchising?We went to Kenya, where this revolutionary business model is surviving not just the typical problems of a start up, but also civil unrest. Dan Logan produced this report on social entrepreneurs at work, part of a series we call, Enterprising Ideas. Out in the highlands of Kenya, we first met Michael Seid... one of the world's top experts on franchising. Over the years, he's consulted for big-name outfits like Burger King, Holiday Inn, and 7-Eleven. A veteran of corporate America—and a native of Brooklyn—Seid seemed a little out-of-place singing traditional songs in rural Africa. But he was a business man on a mission. SEID: I've never had the chance ever to say, "I might be able to save somebody's life." I may be able to save more then one life. And that's—that's—that's a heady kind of statement for a guy who just does franchising. I mean, I do hamburgers, and I do hotdogs, and I do hotels, and I do—you know—dog sitting services. And all of a sudden I can save lives here? Yeah I've gotta come back. BRANCACCIO: Seid is one of several big names in franchising who are convinced that the business model making millions of dollars in the U.S. can save millions of lives in Africa. They're consulting for an operation called Child and Family Wellness Shops, or CFW Shops... a network of tiny drug stores and medical clinics. It's an innovative approach to delivering low-cost healthcare in Africa. We've been reporting on its progress for over a year... and there have been both growing pains and new successes. BRANCACCIO: The shops are owned and operated by Kenyans... like Credence Maina, who runs an outlet in the remote village of Kiburu, three hours north of Nairobi. SEID: All of a sudden you got this entrepreneur, and you got to get excited about this. Her stock is up strong. She's got a full retail offering. She did not go to business school or management school or marketing school. This is great. This made my day. BRANCACCIO: The hope is that the entrepreneurial spirit of people like Maina... trained in healthcare, harnessed by the franchise business model... could become a powerful new tool to take on the African health crisis. KIMBO: What I like about franchising is that, the franchisee is self-motivated, yeah, to do this- to do this activity. In our case, our mission is to serve the poor. BRANCACCIO: Liza Kimbo, who once managed a chain of high-end pharmacies, helped open CFW Shops' first stores eight years ago. It's still a small operation... sixty-eight outlets in all. But Kimbo sees great promise in a business model with very little overhead per patient. KIMBO: We are right now hanging at about a dollar per patient served a year. So, I don't think there's any other system in the world, seriously, that can have claims of—of such efficiency. BRANCACCIO: Here's how it works. The CFW people recruit local Kenyan entrepreneurs and carefully vet them to make sure they're qualified to deliver healthcare and run a small business. The first test for Credence Maina was to raise the equivalent of $300 to pay what's called a franchise fee... just like you would for starting any Dunkin' Donuts in the U.S. In return, the central office gave her business training and a microloan to get the shops outfitted with medicine. These resources allowed her to be her own boss and support a decent standard of living. BRANCACCIO: So how many patients do you see in a typical day? CREDENCE: It is from fifty to a hundred. BRANCACCIO: Fifty to a hundred people come through here? CREDENCE: Yeah. BRANCACCIO: Are you the champion at CFW shops for having so many patients? CREDENCE: Yeah. I am the champion. BRANCACCIO: 15 months later, Maina is still a champion,.. Among the top sellers of all of CFW Shops' franchisees... who have now served over two million patients. The healthcare franchise idea was conceived by Scott Hillstrom, a corporate lawyer and businessman from Minnesota. One day, he read a newspaper article with a chilling fact: 25,000 children die every day because they don't get the medicine they need. HILLSTROM: I remember looking out the window after I read this and—thinking what would a pile of corpse of children that big, what would that look like? And I realized that if I had an experience like that, I would be living a very different life than I was. BRANCACCIO: The classic response to a thought like that by a wealthy person might be to find an organization that is addressing this problem and start writing some checks. HILLSTROM: Well, I actually had been doing that for quite a long time. BRANCACCIO: Hillstrom's problem was with the results of those checks. Over half-a-trillion dollars in foreign aid has been given to Sub-Saharan Africa over the last forty years by one count... yet terrible health conditions remain endemic. HILLSTROM: The money's already flowing into Africa. So it isn't really a question is money available. The real question is, are there better ways to use the money that's already flowing in. BRANCACCIO: Hillstrom's insight was to see franchising, of all things, as a solution. He took several trips to rural Africa to find out more about the healthcare challenges on the ground and, in the process, he uncovered some interesting facts. For instance, medicines in Africa tend to be pretty cheap...especially the drugs that treat the most common causes of death, like malaria and diarrhea. Plus, most African governments try to offer those drugs for free. The big problem is how those drugs are being delivered. Bad roads and weak regulation prevent good quality medicine from getting to people in the first place. For instance, many drugs that are sold on Kenya's streets are counterfeit. HILLSTROM: They just wrap it up in a little piece of paper. And it's a pill. It could be a sugar pill or chalk. And a desperate mother will do anything to get the medicine. So they take advantage of that market opportunity. BRANCACCIO: But franchising has its own internal checks and controls that encourage the sellers of medicine to do the right thing. Quality and consistency is at the heart of successful franchising operations. HILLSTROM: Probably the best way to explain it is to use an illustration. We're all familiar with Subway sandwiches. BRANCACCIO: Oh yeah. HILLSTROM: If you go into a Subway anywhere in the world, you'll find that they wrap the chicken wrap exactly the same way. We need to be diagnosing and treating disease that consistently. BRANCACCIO: If a franchisee can't pull off consistency at CFW Shops, there are penalties. KIMBO: If you get warnings, and you do not—you know, whatever infraction it is, you're not addressing it. Then, according to the franchise agreement, you will be closed down. BRANCACCIO: Plus, the franchise is well-suited for replication and expansion on a large scale... because the overhead to run the entire network of shops gets so much cheaper when measured per store. HILLSTROM: It took Subway something like ten years to reach some number like 75 or 80 stores. But in the 30 years that followed, they reached 26,000 stores. BRANCACCIO: But numbers like that are a long way off for CFW shops. The company is growing, but in recent months, it has been tested by some extraordinary events. Kenya erupted in political violence last winter, after president Mwai Kibaki was accused of stealing the election from the opposition candidate. Hundreds died in vicious, ethnically-motivated attacks. Some of the most intense fighting occurred in the Nairobi slum of Kibera, where just eight months earlier, we had first visited CFW franchisee Dorah Nyanja. She was already facing a daunting caseload in a settlement where roughly one million people live in destitute poverty. BRANCACCIO: Dorah, you're not here seven days a week, are you? NYANJA: Oh, oh, David. We cannot afford to close for a single day. BRANCACCIO: He kept to that promise during the area's grimmest hour. Kibera was a war zone...with police firing tear gas and live bullets... and mobs on the attack with machetes. NYANJA: There are threats all over, I received text messages on my phone, over attempted attacks by other vigilante groups. It was really scary BRANCACCIO: Nyanja stayed in the clinic for four straight days and nights, treating hundreds of victims with machete cuts and bullet wounds... risking her own life in the process. NYANJA: I stayed put because I knew this was a very crucial period. I have to support the person who was fighting back what they felt was not, was not um, done well. So I stayed put and I said, I'll hang on. BRANCACCIO: During the violence, an angry crowd threatened the clinic itself. But a group of local people who knew about Nyanja's work in the community fended them off. NYANJA: They said, we're here with you, we know what you have been doing, and no one is going to get into your premises. BRANCACCIO: In the end, Nyanja's clinic and her staff emerged unscathed. Thankfully, that was the case at every CFW outlet in Kenya. Most of the clinics were located in areas that were comparatively peaceful. But business at some outlets did take a hit...in part because during the violence, CFW Shops couldn't get medicine through to several clinics. Scott Hillstrom visited Kenya last month. HILLSTROM: We had a delivery truck that couldn't move for a full week. patients are still coming to clinics and the drugs are disappearing form the shelves. And so we had franchisees that had no choice but to go out into the market and buy medicine, wherever they could find it. BRANCACCIO: That led to CFW Shops' nightmare scenario: franchisees violating the rules by selling untested, potentially counterfeit drugs. But franchisees like Nyanja felt there was no other solution. NYANJA: I have to use my common sense because there's no other way out, there's no way I'm gonna send my patients away without medicine. HILLSTROM: We should anticipate that franchisees will buy drugs somewhere else. And we didn't anticipate that. BRANCACCIO: After the violence, CFW Shops inspected its stores for unapproved drugs and pulled them from the shelves. For Nyanja, problems persist even months after the violence. In Kibera, the local economy is still reeling... and fewer patients are able to pay her for care than ever before. Nyanja says she's gone through her entire personal savings to stay afloat. But after all she's been through, Nyanja's clinic is still up-and-running. And more help has arrived at CFW Shops: a new, high-powered CEO. Dr. Gunther Faber worked for pharmaceutical giant GlaxoSmithKline and its predecessors for thirty years, most recently overseeing all of the company's drug sales across Sub-Saharan Africa. He left Glaxo for CFW Shops in June... taking a whopper of a pay cut in the process. FABER: You get to a stage in life, is it ... is it the dollars that count all the time? Or is it doing something that you know has got tremendous potential, not only to save lives in Africa, but also to lift people out of the poverty trap. BRANCACCIO: At Glaxo, Faber had been looking at several different ways to make drugs more affordable in the poorest parts of Africa, through health insurance funds and technological innovations. But he is convinced that Hillstrom's idea is the best solution. FABER: I said to Scott, you know, you have found the Holy Grail, because the Holy Grail that I've been looking for, for years. HILLSTROM: I still gotta pinch myself to—to believe that a—a guy of this caliber and experience is—is—is even interested in a job like this. I've never heard of somebody like this taking over an NGO. BRANCACCIO: Dr. Faber has what you might call an extensive rolodex... heads of state from all over the globe and big players in the private sector involved with healthcare in Africa. FABER: I know the distributors in the market, I know the manufacturers, I know the outlets. I know what to do. And in fact, if we get it right, uh, the ... the sky's the limit. BRANCACCIO: On his agenda: meet every single franchisee in the network to learn about their dedication to the brand... plus he wants to find one single drug supplier for the entire company to improve quality and cut costs. But the most pressing challenge for Faber will be to keep this business-oriented venture from operating too much like a typical non-profit aid organization. Franchising consultant Michael Seid was worried about just that, and had issued a tough critique. SEID: I'm going to have ... and my Rabbi hopefully doesn't hear this ... I'm going to have a come to Jesus meeting. I'm gonna take them down and put the fear of God into 'em, because we—we're not on a miss—you know, it's—we're not a mission from God, we're on a mission from commerce. God forgives, business people don't. BRANCACCIO: that wasn't just talk. CFW Shops, worried that it was becoming a top-down bureaucracy, laid off half of its staff at the "corporate" franchisor level. What's more, the company would like to dramatically alter how it funds its operation. Under a new system, charitable grants would directly fund medical care for patients. The "corporate" franchisor would become more commercially driven, paying for itself by charging the shops royalties. HILLSTROM: That way, our NGO operates like a real franchisor and learns to live on the royalties it can earn, rather than on grants. BRANCACCIO: To get more grant money, CFW Shops tapped into President Bush's multi-billion dollar aids initiative, which he renewed last month. And if CFW is successful in the long-run, they hope to inspire others to take their franchise model and run with it in other countries. HILLSTROM: This is how ultimately, we can make franchise health care just as commonplace as micro-credit has become throughout the world. BRANCACCIO: The goal is to have clinics up and running in fourteen countries in just five years. This past may, CFW opened shop in country #2: nearby Rwanda. The first clinic there is located in the outskirts of Kigali, the capital city. Emmanuel Ndoba leads CFW in Rwanda and runs the first clinic along with a nurse who used to work at a local hospital. So far, Ndoba's shop has been seeing about twenty customers a day. He needs about thirty per day to turn a good profit... but feedback in the community has been enthusiastic. Some people just walk away after paying the bill, saying, "Maybe these people may change their minds because this is so affordable, that I cannot, I cannot believe this cost that much!" BRANCACCIO: Ndoba, born and raised in a refugee camp, knows what it's like to have little access to healthcare. Half of his ten brothers and sisters have died from disease. NDOBA: I could have died of any of those diseases that I had in the refugee camp. But knowing I'm here, sitting thinking doing to help another life, to save another life, that is for me huge enough. BRANCACCIO: Rwanda, you will recall, was torn apart by a terrible campaign of genocide 14 years ago, and its infrastructure, including its health care system, remains in recovery. But the country is making impressive strides overall. Its economy grew six percent last year, and its small size and dense population will make it easier for CFW to expand and deliver medicine to the shops. Plus, with a brand new operation, CFW can improve its business model from the ground up. Unlike in Kenya, the first outlets in Rwanda will be company-owned... which is how most franchises start in the u.s. All of this has the company optimistic that it will continue to improve on its bottom line: saving lives. NDOBA: The relationship between the community and the CFW clinic is what is going to make this model actually work in Rwanda and other countries. BRANCACCIO: We want to turn to another area of global health where there has been remarkable progress. Millions of people in poor countries are living and thriving today because of a massive program to dispense medicines that give people with HIV/AIDS healthy productive lives. Senior Correspondent Maria Hinojosa and producer Brian Epstein have that report. MCCURRY: I used to think that AIDS was a—a complete death sentence. You got AIDS, you were gonna die. And with this new treatment—it's clear that you're gonna survive and live a productive potentially happy life. I think once you start to actually get to know these people, whether you meet them or see them through pictures, or stories—I think that humanity comes through. And you just stop thinking about them as statistics, and you think of them as real people. HINOJOSA: Photo journalist Steve McCurry and seven others from the renowned agency, Magnum Photos, spanned the world to document the global aids epidemic. These photos, however, are pictures of hope. The photographers in partnership with the international foundation known as the Global Fund, set forth to show how free anti-retroviral medicine is dramatically changing the lives of those infected. The program is called Access to Life. The Bush administration has so far committed about 5 billion dollars to the world wide effort to provide free aids treatment to poor nations. Steve McCurry, best known for his photo the "Afgan Girl", traveled to Vietnam and documented aids patients before and after aids treatment. One was Nguyen Quoc Khanh, who contracted AIDS from a dirty needle after using heroin. MCCURRY: Nguyen lived with his wife and two children in extremely small—one-room apartment. His two children were so kind of embarrassed and—about his condition, the fact that he had this kind of unmentionable—disease that they wouldn't bring their—his—their friends by. There's this real stigma. I remember we went downstairs into the courtyard of their building. And when we came up the stairs, he could barely walk. I—I thought I was gonna have to end up carrying him up to his apartment. The despair and the hopelessness—on his face was—really depressing. This is profound. This guy is gonna, you know, die right in front of my face. So there this family's life was coming unraveled. When we first got there he was like the walking dead. When we went back four months later, it was though it was a completely different person. It was though he had woken up out of this sort of slumber you could see there was an enthusiasm about life and that he was—eager and had the energy to go back to work. He's a painter. He seemed to be painting things just for fun. I'm sure without that treatment this guy would not be around today. HINOJOSA: Experts agree that medicine alone can not solve the crisis...it will take prevention and education. The treatment, however, is the first step for countries hit hard by AIDS. Photgrapher Jonas Bendiksen traveled to Haiti see what anti-retroviral medicine could do for people like Marie-Sonie St. Louis. BENDIKSEN: She was very, very pale, very frail—young woman just lying in bed inside the little—hut. So she looked very, very bad off—the first time we saw her. I think when we first met her, she, herself, had very little hope to even stay alive—more than a couple of weeks. Now, the second trip when we came back—and I couldn't believe it, we were walking up the same little hill that we had visited—three months before. And this woman was out in the yard kind of doing yard work I thought it was her cousin who had come to visit—something like that but—then realized, after a second look, it was her, you know, just put on amazing amount of weight, you know, totally different energy levels, running around working—spectacular, spectacular change. Playing with the kids—thinking about the future, going to the marketplace, doing the laundry by the river. I mean, these tiny things, for them, it was getting life back. And without the medicines—all the second half of my exhibition you could just cut off and—and nobody would be alive today. It's that simple. HINOJOSA: This medicine will not save everyone, and it doesn't prevent those taking the medicine from infecting others. But today about three million people are alive because of those free anti-retroviral drugs. That's a start...there are almost seven million more in need of treatment. MCCURRY: I think our contribution can be simply, to show their humanity, and that—these are our brothers and sisters. And these are—we're all living on the same small planet. This treatment is the difference, literally, between life and death. |
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