As outlined in our article About the Health Impact Transfer Institute, medical prevention is a key concern of the institute. We are aware of the significant lack of funding for both research and concrete projects that explicitly try to avoid specific medical conditions.

Sadly, the main motivation for most stakeholders in the healthcare sector is directly or indirectly based on the sufficient number of patients. This is to some extent logical, understandable and perhaps unavoidable, but the unapologetic fervor with which some entrenched institutions are defending some their reluctance to change is heart-wrenching, considering that they involve continued yet possibly avoidable suffering by generations.

Many preventive measures are indeed expensive. The desired health outcome might be a reduced morbidity rate or the discovery of otherwise undiagnosed patients who would otherwise continue to live in great discomfort. Any healthcare system has to make some tough decisions about what to invest in, and if the planned or realized investments are effective and in accordance with the planned goals. This is not an easy task, and many countries struggle with these challenging choices.

However, there is a significant subset of preventive measures that can actually be cost-saving, especially if the undiagnosed and untreated condition is costly or results in catastrophic emergencies that could have been partially avoided altogether. Health economists will point out that the long-term effects, especially when accumulated in a population over many years, are also a very significant factor that might even outweigh even significant immediate costs.

Once the payor in any given system recognizes this effect, it should be a reasonable decision to make the necessary investments in order to prevent these future costs. However, in many cases, there are a number of obstacles to such an approach:

  • first, there are often simply too many other things to do, as many institutions and health care professionals are already challenged to secure an adequate level of service (crowding out dilemma);

  • second, there are usuially not enough resources available at any given moment to prioritize more long-term, less immmidiately effective activities (urgency bias);

  • third, in most cases there is insufficient medical evidence from clinical studies that give a degree of certainty commensurate with the fiduciary respnsibility of the payor to expend their resources judiciously (uncertainty bias).

One solution is to disintermediate these risks by transferring the financial loss resulting from a measure not having the desired health and economic effect to a third party, i.e. a typical investor, defined as someone who, in exchange for an appropriate chance of profit, will take on more risk than a given payor. Because the payoffs of prevention can be significant, there is more than enough room for a feasible profit margin for both the healthcare payer and the financial investor.