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Globalization, global health, and access to healthcare

Article  in  International Journal of Health Planning and Management · April 2003

DOI: 10.1002/hpm.698 · Source: PubMed

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international journal of health planning and management
Int J Health Plann Mgmt 2003; 18: 97–104.
Published online in Wiley InterScience (www.interscience.wiley.com). DOI: 10.1002/hpm.698

Globalization, global health, and access to

healthcarey
Téa Collins*
Department of Global Public Health, School of Public Health and Health Services,
The George Washington University, Washington, DC, USA

SUMMARY
It is now commonly realized that the globalization of the world economy is shaping the pat-
terns of global health, and that associated morbidity and mortality is affecting countries’ abil-
ity to achieve economic growth. The globalization of public health has important implications
for access to essential healthcare. The rise of inequalities among and within countries nega-
tively affects access to healthcare. Poor people use healthcare services less frequently when
sick than do the rich. The negative impact of globalization on access to healthcare is particu-
larly well demonstrated in countries of transitional economies. No longer protected by a cen-
tralized health sector that provided free universal access to services for everyone, large
segments of the populations in the transition period found themselves denied even the most
basic medical services. Only countries where regulatory institutions are strong, domestic
markets are competitive and social safety nets are in place, have a good chance to enjoy
the health benefits of globalization. Copyright # 2003 John Wiley & Sons, Ltd.

key words: globalization; global health; access to healthcare

INTRODUCTION

Although many health issues currently discussed under the construct of globalization
are similar to those that world health has faced for decades, their context is different.
What once were problems for discrete countries are now seen as problems for every-
one. With the establishment of closer economic, political, social, financial and cul-
tural linkages among nations, and especially the proliferation of international travel,
problems such as infections threaten mankind on a global scale. For that reason, we
talk increasingly about global rather than international health. However, the focus is
sometimes too heavily on disease. While much of the globalization and health litera-
ture focuses on the global spread of infection, there is no recognition of the implica-
tions of globalization on the functions of health systems, such as access to healthcare
for the most disadvantaged segments of the populations across the world.

* Correspondence to: Dr T. Collins, 4515 Willard Avenue, Suite 2014, Chevy Chase, MD 20815, USA.
E-mail: TCollins@gwu.edu
y
This article is based on the author’s experience of working for the World Bank Health Reform Project in
the Ministry of Health of the Republic of Georgia.

Copyright # 2003 John Wiley & Sons, Ltd.

98 T. COLLINS

This paper is an attempt to explore the linkages between globalization and health.
It defines the concept of globalization, then it discusses the impact of globalization
on access to healthcare. Finally, it describes the effects of globalization on the
healthcare systems of the countries in transition using the example of the former
Soviet Republic of Georgia.

GLOBALIZATION AND GLOBAL HEALTH

The term ‘globalization’ has become somewhat of a cliché. As a convenient ‘catch-

all’, it has been cited as both cause and effect, as a source of integration and aliena-
tion, as leading to regionalization and as an ‘end of geography’, as well as a facil-
itator and inhibitor of policy change (Lee, 1998). However, most clichés have a
certain degree of factual validity; so does this one. Despite the controversy about
what globalization constitutes as a phenomenon, everyone seems to agree that it
is happening and we need to deal with it.
Currently there is no agreed definition of globalization, mainly because it means
different things to different people. Writers often focus only on certain aspects of
globalization (e.g. economic, information and technology, communications, etc.)
and ignore other sectors (e.g. health). Held et al. (1999) provide the most compre-
hensive definition so far, which encompasses the multifaceted character of the phe-
nomenon. According to the authors, ‘globalization is a process (or set of processes),
which embodies a transformation in the spatial organization of social relations and
transactions—assessed in terms of their extensity, intensity, velocity, and impact—
generating transcontinental or interregional flows and networks of activity, interac-
tion, and the exercise of power’. Globalization is occurring along three dimensions:
spatial, temporal and cognitive (Lee, 1998). Even though globalization should be
seen in broad historical perspective, Lee (1998) argues that what makes globaliza-
tion different at the turn of the 21st century is that these ‘dimensions are being
affected with unprecedented intensity’.
The term ‘globalization’ was originally used in the 1940s. Three decades later,
the political economist George Modelski (1972) reintroduced the term to describe
the growing impact of multinational corporations on economic relations among and
within countries (Lee, 1998). This feature of globalization attracted even more
attention after the emergence of international organizations with a mandate to gov-
ern the terms of global commerce and finance. Particularly important in this regard
are the World Bank, the International Monetary Fund and the relatively recently
established World Trade Organization (WTO) (Waters, 2001). Over the past decade,
however, the term globalization has been redefined many times and has come to
describe a complex process occurring unevenly across the different spheres of
human lives, not economic alone.
The phenomenon of globalization has led to the identification of another phenom-
enon, global health. Berlinguer (1998) has defined ‘globalization of health’ as the
result of greater cooperation in disease control across the world. Nation states, he
argues, have started moving away from purely national interests toward systems
supported by joint values and shared strategies. However, policy-makers and the

Copyright # 2003 John Wiley & Sons, Ltd. Int J Health Plann Mgmt 2003; 18: 97–104.
 GLOBALIZATION AND HEALTHCARE 99
public health community worldwide have also become aware that global connectiv-
ity has facilitated the spread of infections and that ‘microbes do not respect interna-
tional borders’ (Waters, 2001).
It is now commonly realized that the globalization of the world economy is shap-
ing the patterns of global health, and that in turn, associated increased morbidity and
mortality is affecting countries’ ability to achieve economic growth (Brundtland,
1999). The debate over globalization’s positive or negative impact on the health sta-
tus of nations has made international public health an issue of global concern. In this
regard, many ideas are controversial. Some authors argue that globalization pro-
vides opportunities to create a renewed commitment to global health, whereas a
critical view focuses on the damaging effects of global markets on health. Others
believe that the issues of power and politics determine who benefits from globaliza-
tion (Navarro, 1998, 1999). In public health, as in other areas of international policy,
a key challenge remains as to how to attain international health governance and
balance local and global priorities.

GLOBALIZATION AND ITS IMPACT ON ACCESS TO HEALTHCARE

The relationship between globalization and economic growth, income distribution

and poverty provides the general background for discussing health outcomes. When
economic growth entails poverty reduction, health status also tends to improve.
Higher incomes at the household level result in improved access to health and
health-related goods and services. Growth also provides societal resources,
including government revenues, to supply those goods and services (Diaz-Bonilla
et al., 2002).
However, in order to translate the economic benefits of globalization into health
benefits, economic growth should be sustainable and targeted towards the poor.
It also requires that the resources generated through the globalization process are
used to strengthen national health systems, to ensure access to essential health ser-
vices, and to improve other health-related services, such as education, nutrition,
water and sanitation, and environment.
The world’s experiences so far have been discouraging. As a result of globaliza-
tion over the past decade, in some countries aggregate improvements in the stan-
dards of living have been reversed. For example, in many countries of West Asia
and sub-Saharan Africa, per capita income levels have fallen below their 1970s
levels. The rise in inequality was universal in the countries of the Former Soviet
Union, and common in Latin America and member states of the Organization of
Economic Cooperation and Development (OECD), and in South Asia, South-East
Asia and East Asia (Cornia, 2001). A study by Cornia and Kiiski (2001) suggests
that the relationship between globalization reforms and within-country inequality is
complex and ‘there appears to be an overall association between rising within-
country inequalities and the policy changes over the last 20 years’.
Rising within-country inequalities of income distribution has a significant impact
on access to health care. Access to health care is defined as the possibility of obtain-
ing care when it is needed (WHO, 2000a). Not surprisingly, the poor use health care

Copyright # 2003 John Wiley & Sons, Ltd. Int J Health Plann Mgmt 2003; 18: 97–104.
100 T. COLLINS

services less frequently when they are sick than do the rich. For example, in ten of
eleven Sub-Saharan African countries in which Demography and Health Surveys
(DHS) were undertaken during 1990–93, children from families in the highest (of
three) socio-economic categories were more likely to be taken to a medical facility
for treatment when ill than were children in the lowest socio-economic category.
Interestingly enough, women with secondary education were 20%–40% more likely
to take their children to a medical facility for treatment than were women with no
education (Gwatkin, 1999).
There are also remarkable differences in out-of-pocket expenditures as a percen-
tage of household income after reimbursement between the rich and poor, which is
believed to significantly reduce access to care among the poorest. For example, in
Thailand, the poorest income quintile, which reported the highest rate of acute ill-
ness and hospitalization, had higher annual health expenditure relative to income
(21.2%) than the richest quintile (2.1%). In addition, after reimbursement, house-
holds whose heads had only primary education (3.4% of household income), held
low-income cards (6.1%) or had no health benefit cover (4.6%), devoted relatively
high shares to health (WHO, 2000a).
The negative impact of the World Trade Organization’s (WTO) trade liberaliza-
tion policies is well documented. As Rosecrance (1999) mentions, individual states
are weaker than before and have less power than in the past to enact public policies
that counteract global processes: ‘the reliance on international flows has cost gov-
ernments the ability to guarantee specific economic outcomes for their populations’.
Member states of the WTO have to abide by several multilateral agreements, of
which the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agree-
ment probably has the greatest effect on access to medicines. The TRIPS agreement
deals with patent law and sets some minimum standards, such as 20-year patent pro-
tection for pharmaceuticals. The implications of the TRIPS agreement are the fol-
lowing:

Copies of the drugs under patent either produced locally or imported should be
banned from the market;

The generic equivalents would come onto the market only after the expiration of
the patent of the patented drug, and during this period of patent protection there
will be no cheaper alternatives;

The patent holder will have twenty years of monopoly on a pharmaceutical pro-
duct, which enables him to keep the price of the patented drugs high (WHO,
2000b).
It is self-implied that the restrictive nature of the TRIPS agreement makes it very
difficult if not impossible for developing countries to purchase drugs at the prices set
by the manufacturer. The situation is further complicated by the fact that the TRIPS
Agreement protects not only the process through which the product is produced but
also the product itself. Therefore it is not possible to manufacture and sell a patented
drug made through a new process.
Due to the fact that drugs are considered essential goods, the concept of accessi-
bility to pharmaceuticals is very important. It means that the policies pursued must
make drugs available for all who need them, and at affordable prices. Member

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 GLOBALIZATION AND HEALTHCARE 101
states, therefore, must try to bring their regulations in line with the obligations of the
agreement so as to ensure access to medicines for the most needy. However, the
interpretation of two of the agreement’s clauses (on parallel importation and on
compulsory licensing) has been highly contested. The government of South Africa,
for example, asserted its rights under the TRIPS agreement, arguing that a respon-
sible government must be able to produce its own generic drugs at affordable prices
(Bond, 1999). The pharmaceutical industry, reflecting a more restrictive interpreta-
tion of the agreement, challenged the legality of South Africa’s action. Because of
their limited technical capacity and heavy dependence on donor aid, low-income
countries are likely to be at a disadvantage when negotiating multilateral agree-
ments, which in turn has negative effects on their populations’ health. For example,
WHO estimates that in 2002, around 6 million people in developing countries are in
need of antiretroviral (ARV) therapy. Yet only some 230 000 people living with HIV
in those countries have such access today.
The good news is that the drawbacks of globalization can be counterbalanced by
means of globalization itself. A good example of this is the Accelerating Access to
HIV/AIDS Care and Treatment Initiative. As the high cost of medicines is a major
factor limiting access to ARVs in developing countries, in May 2000 five interna-
tional organizations (the United Nations Population Fund [UNFPA], United Nations
Children’s Education Fund [UNICEF], World Health Organization [WHO], World
Bank and UNAIDS Secretariat) entered into a partnership offered by five pharma-
ceutical companies. As a result of this initiative, the cost of ARV drugs offered by
the pharmaceutical partners for the least developed countries has decreased signifi-
cantly. About 27 000 people have gained access to ARV therapy in 19 countries in
Africa, Eastern Europe, and Latin America and the Caribbean, which represents a
ten-fold increase in the number of patients treated in those countries.
It would be naive to think that the Access to Drugs Initiative can solve all the
problems in the treatment of HIV that low-income countries are facing. In many
developing countries people with HIV/AIDS still do not have access to basic treat-
ment of opportunistic infections, or to palliative care. However, the success story is
encouraging and could be considered as an important step forward.

GLOBALIZATION AND ACCESS TO HEALTHCARE IN COUNTRIES

IN TRANSITION—CASE STUDY OF GEORGIA

The economic transition of the countries of Central and Eastern Europe and the for-
mer Soviet Union and their integration into the global economy are, in fact, two
sides of the same coin. The combination of transition and globalization has affected
the development of countries in transition in most fundamental ways. This is not
surprising. First, the former Socialist bloc countries were isolated from the rest of
the world until the early 1990s. Second, globalization was more challenging for the
countries in the region considering the difficulties they faced in the process of
transition from centrally planned and government-owned economies to market
economies based on private ownership. In fact ‘transition involved the dismantling
of one system and its replacement by another’ (Mojmir, 2000). This meant that

Copyright # 2003 John Wiley & Sons, Ltd. Int J Health Plann Mgmt 2003; 18: 97–104.
102 T. COLLINS

fundamental reforms had to penetrate all sectors of the economy as well as reshape
and establish new institutions (Allsopp and Kierzkowski, 1997).
The social and economic disruption, with slow growth and a rise in inequality,
adversely affected the countries of the Former Soviet Union, a fact that is reflected
in the worsened health statistics. For example, between 1989 and 1994, life expec-
tancy in Russia declined by more than 6.7 years in men and by 3.4 years in women
(Shkolnikov, 1997), an unprecedented decline in such a short period of time. This
can be explained in part by the rise in mass poverty as a result of liberalization and
economic globalization. In the year following liberalization (1992), more than one-
third of Russians were classified as poor. The poverty rate declined gradually from
approximately 36% to 25% in 1994, but increased again to 29% in 1996 (Zolin,
1997). In the country of Georgia, about 40% of the population is below the poverty
line, considering a ‘vulnerability poverty’ line set at 105 GEL (1US$ equals
approximately 2 Georgian Lari [GEL]) per month (UNDP, 2000). The most distin-
guishing feature of poverty in these countries is the fact that it not only affects the
weak and less educated people, but increasingly strikes employed wage-earners and
has unexpectedly also touched well-educated professionals and skilled workers.
The political and economic transitions in the former Socialist countries have
adversely affected social services. A number of studies found that after these coun-
tries opened up their economies to the world, the structural and economic changes
imposed by market reforms have had a negative impact on their health sector
(Berman and Bossert, 2000). The economic changes that began in the early 1990s
rapidly dismantled the socialized mechanism for financing health care. The result
was a sudden introduction of market forces into what had been a state-organized
system. State budgets were inadequate to support a large number of oversized hos-
pitals. The rapid privatization and price liberalization was introduced along with
decentralization of the health system in response to structural adjustment pro-
grammes promoted by the International Monetary Fund and the World Bank in
many countries.
No longer protected by a centralized health sector that provided free universal
access to services for the residents of urban centres and provincial regions alike, large
segments of the post-communist countries’ population found themselves denied even
the most basic medical services. For example, in Georgia access to healthcare servi-
ces is very limited for a substantial segment of the population (50%) and for 30% it is
almost out of reach for economic reasons. The studies have shown that the combina-
tion of low disposable income and poor services has resulted in the situation that
95.8% of the population often avoid visiting a doctor and treat themselves instead,
which in 81.1% of cases involves the use of prescription drugs. A quarter of these
people (25.5%) have no knowledge of medicine and often jeopardize their health
when using self-prescribed treatment with antibiotic or specific drugs (UNDP, 2000).
Overall, in the period of transition Georgians found it difficult to identify the tan-
gible accomplishments of health reform. No improvements have been achieved in
terms of the quality, efficiency and access to the healthcare system as a whole.
What are the reasons for the ‘failure’ of the Georgian health reforms? Berman and
Bossert (2000) suggest that we distinguish purposeful health reform from changes in
the health sector that are imposed by reforms from outside the sector. They argue

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 GLOBALIZATION AND HEALTHCARE 103
that when ‘changes are imposed by broad government initiatives with international
donor support, they usually do not have the goal of improving the health system.
Rather the reforms seek to achieve non-health goals such as macroeconomic stabi-
lity or more democratic political systems’. The reforms in Georgia were initiated
haphazardly as a condition for the World Bank loans and were not backed up by
adequate institutions and resources (human and financial) to implement them.
The rush to insurance-based medicine was more a rush from the previous system
that a well-thought-out policy direction. After 70 years of a Soviet rule, the country
had no capacity to provide insurance-based health care. In an attempt to attract fund-
ing and ‘please’ the donors, the reforms were being imposed and implemented by
the government, and the people have never been involved in the process of ‘revolu-
tionary changes’. As a result, the crisis of the health system quickly became the
crisis of the market economy and, allegedly, a crisis of globalization.
In conclusion, globalization is neither all bad nor all good for health. It is impor-
tant to understand how globalization can be changed, shaped and directed for better
outcomes, through thoughtful policymaking, the emergence of civil society, and
strengthening of global governance. If properly managed, globalization can lead
to important health gains. Only countries where regulatory institutions are strong,
domestic markets are competitive, access to public health services is almost univer-
sal, social safety nets are in place and income inequalities are minimal, have a good
chance to enjoy the health benefits of globalization.

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