Franchising Health Care in the Developing World
Approximately 17,000 children die each day. Half of these children live in Africa, and two-thirds of them die because they lack access to effective medical treatment that costs less than a latte. Many lack access to essential drugs. Many have substandard access. Many live too far from help.
A large percentage of healthcare is not effective in Kenya because providers respond to perverse incentives causing them to deliver substandard care.
Franchising reverses perverse incentives by:
- Maximizing profits by selling cheaper counterfeit drugs
- Delivering substandard care because delivering an effective quality standard costs more
- Providers who deliver substandard care in rich countries suffer severe consequences (e.g. Jail) – In poor countries, they make more money
Business format franchising – effectively performed – incentivizes healthcare providers to deliver care at the standard necessary to achieve effective treatment by:
- Franchisees own a valuable business, but only so long as they comply with quality standards.
- They are incentivized to follow the rules because if they break them, their franchise will be revoked and they will lose their business.
To improve access to essential drugs, basic healthcare, and prevention services for children and their families in the developing world using business models that maintain standards, are geometrically scalable, and achieve economies of scale.
Healthstore concentrates on a short list of preventable and treatable diseases (and perinatal conditions) that account for approximately 70-80 percent of illness and death.
Through its nonprofit franchisor, Healthstore operates and funds a network of 57 for-profit CFWclinics owned and operated by franchisees. Franchising Clinics in Kenya The CFWclinics network serves 40,000 people per month in-store and through outreach events:
- Health screenings
- Deworming children
- Sanitation training
- HIV prevention & education
- Water purification training
- Health Camps
Healthstore’s Three-Point Test
- Does it maintain standards?
Can it consistently deliver the quality standards necessary to provide effective treatment? Can it be replicated?
- Is it scalable?
Only what can be replicated, can be scaled. Only what can be scaled, can deliver effective-quality care to large populations across a network of clinics that never gets to big to maintain standards.
- Does it achieve economies of scale?
Networks that scale, reduce the cost per person served as they grow.
The Scalability Achievable with Franchising
More Than 6 Million People Served
Since 2000, The Healthstore Foundation’s CFW franchise network has served over 6 million people in Kenya with:
- High-quality essential drugs
- Basic primary healthcare
- Prevention services
- Health education
Healthstore Past Financial Partners
Anbinder Family Foundation
David Weekley Family Foundation
Flora Family Foundation
Hot Dish Advertising
International Finance Corporation
Mark Gordon Family Foundation
Michael Seid & Associates
Oswald Family Foundation
Procter & Gamble