Do we cast Filipino nurses as “global goods” rather than “domestic providers” of health care? Do we implicate them as sources of remittance income rather than for their potential contributions to the local health system?

Trade in health services is continuously growing. There are four ways based on the General Agreement on Trade in Services (GATS) by which the Philippines can take advantage of. In particular, Mode 4 (Movement of Health Professionals) offers possibilities for the entry and temporary stay of health professions in a foreign country in order to supply a service. Two forms for the international trade in health services exist: (a) temporary movement of health professional to provide services abroad, and (b) short-term health consulting assignments. As such, developing countries including the Philippines, export health care professionals to other countries most especially to the developed ones.

The ASEAN Economic Community promotes different forms of trade in health services. It ranges from exportation of cross-border health care to migration of health professionals, and direct foreign investment in the health sector. The liberalization of trade in health services, espoused by the ASEAN Integration, has further promoted the migration of health professionals.

The Philippines is known to be among the countries with the highest labor exports. Since the “world price” of nurses is higher than the “local price”, the Philippines has a comparative advantage in producing nurses, and substantially gains by producing and exporting more. According to the Commission on Filipinos Overseas, 4.3 million Filipinos were living outside the Philippines under temporary, work-related residence programs. Many health professionals are among those living outside the country for work-related reasons.

The majority of deployed health professionals are nurses, which is estimated to be around 87,000. These nurses are deployed mostly in the Middle East. Destination countries for temporary residents include Saudi Arabia, United Arab Emirates, Kuwait, Hong Kong, and Qatar. For permanent residents, the destination countries include USA, Canada, Australia, United Kingdom, and Japan.

Several reasons push nurses to leave the Philippines. The main push factor identified by nurses is low salary. Other push factors include poor work environments and lack of employment opportunities. On the other hand, nurses are primarily attracted to better working conditions and higher remuneration offered by other countries, which is about five times more than they would receive in the Philippines.

The movement of health professionals from low-income to high-income countries somehow improve economic efficiency. For receiving countries, migration helps alleviate shortages of domestic health professionals observed in middle- and high-income countries.

In a way, migration tends to ease the sending country’s problem with unemployment by allowing unemployed and underemployed health professionals to take on jobs that are available for them abroad. More importantly, one of the favorable effects of nurse migration for the sending country such as the Philippines is the considerable remittances sent home by these nurses each year. In the case of Filipino nurses, a significant share of their earnings is usually remitted home. The remittances of these health workers help finance the health care needs of the local population.

Unfortunately, these remittances will not be able to offset the loss of skilled nurses due to migration, leaving behind an already disadvantaged health care system. How do we balance competing interests in overseas health professionals’ remittances and the need for qualified health workforce in our weak health system extremely affected by the uneven distribution of health workers?

The migration of HCPs has the potential to create an imbalance in supply and demand of health workforce in both the home and destination countries. So far, the migration of nurses from the Philippines has not led to any domestic shortages unlike in Indonesia and Malaysia where migration exacerbated shortages of nurses. The mushrooming of nursing schools in the Philippines has relieved concerns on the potential domestic shortage of nurses due to exportation. However, concerns with the quality of education provided by new nursing schools have been raised in recent years.

Another negative effect that the Philippines experience is the loss of educational expenditure. When a government-subsidized nurse migrates to another country, the Philippines do not only lose a health care professional but also the money invested in his/her education. However, if nurses return home after a number of years, they will be bringing back with them new knowledge and skills. In contrast, permanent migration risks substantial human resource or capital losses with expected long-term effects on social and economic development.

Clearly, trade in health services creates both opportunities and risks. At the end of the day, it is important that we ask who truly gains and loses in this kind of trade. Do the losses, if any, exceed the gains? Is this kind of trade motivated by the government’s desire for revenue? Or is it motivated by the desire to cope with overproduction and lack of job opportunities for nurses in the Philippines?

References:

Arunanondchai, J., & Fink, C. (2007). Trade in health services in the ASEAN region. The World Bank.

Dayrit, M., Lagrada, L., Picazo, O., Pons, M., Villaverde, M. (2018) The Philippines health

system review. World Health Organization Regional Office for South-East Asia. Retrieved from http://apps.searo.who.int/PDS_DOCS/B5438.pdf

Lorenzo, F. M., Galvez-Tan, J., Icamina, K., & Javier, L. (2007). Nurse migration from a source country perspective: Philippine country case study. Health services research, 42(3 Pt 2), 1406–1418. doi:10.1111/j.1475-6773.2007.00716.x

Rodolfo, M. C. L. S., & Dacanay, J. (2005). Challenges in Health Services Trade: Philippine Case (No. 2005-30). PIDS Discussion Paper Series.

Sriratanaban J. (2015). ASEAN integration and health services. Global health action, 8, 27199. doi:10.3402/gha.v8.27199