With industrial growth on the increase across many emerging markets, Marco Giacomelli, head of Generali Global Health, looks at the healthcare challenges faced by organisations operating in these regions, with a spotlight on oil and gas exploration in Africa.
The oil and gas industry in Africa is growing. Nigeria has the fourth mostvaluable reserves of energy in the world, at US$6.8trn, according to a 2013 report from BP. To put that into context, it is estimated that Nigeria has over 37,000 million barrels of oil in reserve. Other African countries such as Angola and Chad also have substantial reserves at 9,500 million and 1,500 million barrels respectively. Much of this potential is as yet untapped and significant expansion in oil and gas exploration has taken place in these counties over the last 10 years.
The difficulties in extraction and transportation cannot be underestimated and several additional influencing factors add to the challenges faced by workers in these environments. Disease is a major concern with HIV/AIDS, tuberculosis and malaria all at endemic levels across many parts of the region.
Another big barrier to economic growth is poor infrastructure. Twenty five per cent of all roads, for example, are unpaved and there are only 2.5km of road per 1,000 people. Take towns and cities out of the equation and it is easy to imagine the severe lack of developed road and other transportation networks in more remote localities, where much of the exploration takes place.
Energy exploration is labour intensive. Multinationals, global investors and regional consortia have been employing ever-increasing workforces; both expatriate personnel and mobile employees, as well as qualified local nationals. Drilling platforms alone need a 50-100 strong drilling crew and the whole team on the rig can number in excess of 200.
Add in land-based logistical staff and other support industries and the numbers of people placed in these remote locations can be significant.
Large employee numbers coupled with high-risk environments create health and safety minefields for energy companies. If a member of staff has an accident or falls ill, the same challenging environment makes it difficult to provide quick and effective medical care. International private medical insurance (iPMI) providers need to overcome these hurdles by creating well-designed products and procedures able to handle medical emergencies when they happen.
Three issues are of particular importance to employers, brokers and iPMI providers:
* Underwriting and plan design
* Patient care and transportation
* Employee wellness
Underwriting and Plan Design
Underwriting and designing medical insurance cover for energy companies operating in remote locations is complex.
A bespoke approach is required and plan design must take into account individual challenges that are often unique to each site. Considerations are varied and include:
* The complexity of transporting a patient to a suitable medical facility. Air ambulance transportation such as rig-to-shore is more commonplace
* Diseases in many areas are at epidemic levels, increasing the likelihood of patients falling ill
* Social and political issues are often heightened; civil unrest, terrorist activity and the likelihood of kidnap and ransom or violent crime can be of particular concern
Plans can vary from more standard cover by providing additional benefits such as increased evacuation benefit to include rig-to-shore cover, nonemergency transportation benefit to allow transportation outside of country if treatment is not available in-country and cover for common communicable diseases. Assistance is an essential element of any plan design but the situation in Africa can be more challenging than in many other emerging regions. The accessibility and reliability of the healthcare infrastructure in African countries can be variable. This is especially true in remote locations and it is here that a number of private clinics have been set-up to cope with the demand for quality healthcare. In a number of cases, these clinics have been established by emergency assistance companies, many as a consequence of specific requests by oil and gas exploration companies to do so.
This helps to ensure a level of healthcare that consistently meets the expectations of field workers, with clinics typically offering a range of day-patient services such as:
* General medical practice
* Occupational health services
* 24/7 medical emergency management
* Prevention and training programmes
* Drug and alcohol testing
* Laboratory exams
* Standard X-ray
* Organisation of treatment abroad
* Medical transport and evacuation
Given the significant investment involved with setting up such clinics, many operate on a fee-for-access basis via a membership fee system. iPMI providers need to offer viable insurance premiums to employers who might already be paying for access to clinics. Generali Global Health solves this issue seamlessly, through our affiliation with our sister company Europ Assistance (EA) and their ability to embed access fees to EA clinics within the plan design and premium structure. Removing the need to pay for both clinic access and health insurance overcomes a major obstacle for energy companies looking to fund high-quality health insurance for their workforce.
Patient Care and Transportation
iPMI Providers also need to work closely with each customer to understand their medical protection requirements. Employee numbers, level of risk exposure, local transportation routes and communication channels all need to be taken into account. This enables contingency plans to be established that can react quickly to circumstance as they arise.
Following an accident or illness, a process involving four potential stages kicks-in, depending on the severity of the event: onsite treatment, evacuation to a local clinic, evacuation to a specialist treatment centre, and international evacuation.
Stage I usually involves an on-site doctor, who will be able to deal with most minor ailments. A decision can then be taken on whether evacuation is required – the aim being to align the patient’s medical condition with the local medical infrastructure. Where a medical evacuation is needed, it will often be to a local clinic for treatment or stabilisation and then onward to a specialist hospital if necessary. In more severe cases, international evacuation may be required to the nearest centre of excellence.
Depending on the location, transportation can add significant cost, which needs to be taken into account when pricing a policy. This is especially true in Africa, a vast continent with a limited number of top-tier medical facilities. The exception is South Africa, a country widely considered to be Africa’s centre of excellence and home to a large number of first-class hospitals and clinics.
Insurers and brokers can take an active role with employers in supporting their people’s wellness. A healthy workforce will be more productive thanks to reduced absenteeism, and the resulting lower incidence of claims, that can help contain future premiums increases.
Initial site set-up with a health risk assessment, a health and safety framework with appropriate risk mitigation measures, a comprehensive medical evacuation plan and a core on-site medical team are important first steps. Staff monitoring can be achieved by pre-employment health risk assessments and annual check-ups. And educational activity can take place via medical staff briefings and educational material outlining how to stay safe and protect against diseases such as malaria and infections spread by poor hygiene.
With today’s data analytics technology and sophisticated predictive modelling, claims and treatment data pertaining to larger employee populations can uncover diagnostic trends. These can drive the implementation of healthcare strategies to tackle the root cause of the issue. If productivity within a local employee population is reducing due to a frequently occurring illness, for instance, this can be highlighted, investigated and steps taken to address the situation.
Likewise, data sets with sufficient size and credibility can validate utilisation driven health plan benefits, designed according to an employer’s risk profile and the needs of its people.
This type of customer centric approach to managing health risks implies a deeper commitment for iPMI providers to ensure the wellbeing of insured individuals and family members.
Demand from local nationals
Many of the healthcare issues faced by companies in Africa and other emerging markets also apply to local nationals living in developing countries. Lack of a sufficiently high standard of medical facilities and poor transportation links making it difficult to access medical care are concerns local employees have to deal with.
These issues, coupled with increasing wealth, create a demand for international health insurance and there is significant opportunity for insurers and brokers to shape local markets by introducing flexible, cost-effective health insurance solutions.
The African economy is one of the most dynamic in the world with growth rates forecast to be 4.5% and 5% in 2015 and 2016 respectively, according to Africa Economic Development. African high net worth individuals (HNWIs), those with at least US$1m to invest, have increased by 145% during the past 14 years (2000-2014)
compared to the worldwide HNWI growth rate of 73%. This trend is filtering through to all levels of income brackets with those categorised as ‘stable middle-class’ by the African Development Bank now representing 13% of the continent’s population.
Developing countries present unique challenges to the iPMI industry. Africa is no exception and energy is a good example of an industry that can face substantial obstacles from disease, remoteness, access to healthcare and political and social unrest. To provide the protection that is needed, health insurance programmes must be able to meet these risks and challenges. Benefits such as increased evacuation cover, communicable diseases, non-emergency transportation and access to local clinics within the plan design and premium all need to be considered as part of a tailored plan design.
Marco Giacomelli is head of Generali Global Health