Propelling an NGO’s Transition to a Business Company

Healthcare in the Philippines has been criticized for being both unaffordable for and inaccessible to the poor.  This is exacerbated by the little trust that Filipinos have of existing healthcare services. Fortunately, organizations like HealthDev Integrative Clinics, Inc. (HDIC) are helping address these problems.

HDIC started as a program of the HealthDev Institute (HDI), a non-stock, non-profit organization, before it became a stand-alone clinic in 2007. The Medical-Dental Clinic and Laboratory are the primary components of the Health Service Provision Program (HSP) of the Institute.4  Located at the campus of Ateneo de Manila University (ADMU), it provides comprehensive alternative health care program that is safe, effective, research-based, personalized and systematic.5

This is a good case study of a health-oriented NGO faced with dwindling resources from donors and funders, and the shift of its health program as a separate business corporation to sustain its mission and operations.

HDI staff members were given separation pay and were asked to reapply to HDIC, undergoing the usual screening process within a probationary period. HDI provided a seed capital of half a million pesos and donated all existing clinic equipment and fixtures to HDIC. 

As a former NGO that transitioned its vital program into an independent business entity, HDIC could comply with all government requirements. The management focused on installing internal systems including periodical reviews to ensure the new company’s sustainability.

HDIC caters to two market segments—ABC (high and middle income groups) and DE (low income group) through the campus-based ADMU clinic and the mobile clinic, respectively. Both clinics are interdependent in sustaining the social and economic value of the services HDIC provides.

The clinic offers medical (family medicine, specialty care, physical therapy, acupuncture, comprehensive dental services, etc.), laboratory and diagnostic services.  Clienteles include students and employees (and their beneficiaries) of ADMU, NGOs, and other affiliated organizations.  Payments are received around 60 days or less depending on the package and scheme.

The mobile clinic applies a different approach.  HDIC partnered with the Kasagana Ka Development Center, Inc. (KDCI), a social development NGO that seeks to create vibrant economic and social infrastructures in urban poor communities,6  to identify qualified beneficiaries including employees of small and medium scale industries. With the K-Kalusugan program, HDIC visits KCDI branches and offers healthcare packages that community members pay in installment. KDCI pays half of the total amount of availed services to HDIC and settles the other 50 percent within the next 30 days after payments come in. The Peace and Equity Foundation (PEF) provided a loan to help improve the service capacity of the new mobile clinic. This was used to purchase its first automated equipment in the laboratory.

With the mobile clinic, HDIC is able to reach out poor communities needing quality healthcare services through tailor-fit packages and payment mechanisms based on their financial capacity. And unlike in the case of the ADMU clinic, patients need not travel as the clinic goes to them.

The increase in demand for the services in both clinics raises the problem of an inadequate number of health professionals.  HDIC also recognizes the difficulty in maintaining low service/package fees given the rise in maintenance costs of equipment and supplies.

Nonetheless, the HealthDev business model is proven to work; they restructured from a foundation to a business entity, rebuilt their capacity, complied with government requirements, tested the market, and offered packaged services that respond to their clientele.

To date, the clinics have provided health services to 14,820 client beneficiaries and their dependents.  HDIC is still learning, checking and studying their market to find out what they need and how to deliver the necessary corresponding services. Indeed, HDIC lives up to its motto of “helping people, enriching lives”.