How BPOs can create a medical industry in the Philippines
Analysis and Opinion
By Joe America
It strikes me that the Department of Tourism sponsoring “medical tourism” by designating hospitals here and there to provide medical care to foreigners is a weak approach. Medical care is a need, not a sightseeing tour.
The private sector can do it better. And the time to do it is right now!
Medical care in the US will collapse under Donald Trump. Costs will certainly rise. A new market will flare up, people who require major medical care but can’t afford it in the US. And they will welcome a lower cost plan.
An enterprising BPO company will eventually figure out how to cater to this market. They can manage the contacts and the data and build a whole new sector of business. A very profitable one.
When I say “manage the contacts” I mean:
- Work with partner hospitals to build a database of medical services, costs, and doctors in the Philippines.
- Work with housing leasing companies to build a database of facilities and reservation agents.
- Work with Immigration to serve as visa representatives for overseas visitors to provide 9A visas (69 days, extendable).
- Work with medical organizations in the US, or place advertising, to secure referrals.
Put the elements together in a package with sign-up fees and a commission percentage for each bill paid by the overseas client for medical care, housing, and visa.
Manage the data and the contacts.
Lease more high-rise space to support the new industry.
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PLEASE REFER TO THE FOLLOW-UP ARTICLE FOR FINANCIAL SIZING AND FEASIBILITY ASSESSMENT: “PHILIPPINE MEDICAL BPO HUB, ROUND 2“.
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Cover photograph from SEADOC article “TOP INTERNATIONAL HOSPITALS IN PHILIPPINES FOR FOREIGN PATIENTS”.
The Society of Honor by Joe America 
Thanks, Joe. This is brilliant and will have the good side effect of keeping more doctors and nurses in the Philippines. I would add:
5. Use the app and monitoring capabilities of modern medical and fitness equipment, for instance, for retirees who have medical conditions but don’t need to be in the hospital constantly. There are, for instance diabetes monitoring devices worn on the arm. I wondered why I got an ad for one recently as I fortunately don’t have diabetes, but it is with an app. That app comes with a warning when certain set values are reached, don’t know exactly. That would merge nicely with BPO companies building the medical tourism industry.
Oh, absolutely excellent point 5.
Our long time competitor in tourism is Thailand and that is where we copied what they call this nationwide medical promo.
https://www.medicaltourism.com/destinations/thailand
We compare our militaries, our traffic, our economies, etc.
Very comprehensive write-up citing the benefits of low costs and modern quality. Their medical visa is like the 9A visa here, intermediate term and extendable. Their housing arrangements are hotels. I imagine condo leasing as less costly for longer term treatments and care (chemo patients). And the driver would be BPOs, not hospitals or tourism.
BPOs with Healthcare clientele. MVP, Ayalas are consolidating their Hospital assets.
Theirs a BPO for every sector. not all but almost.
Tourism and Healthcare included
Hospitality sector too.
most filipino lady boys go to thailand for sex change operation. apparently, our country lack the medical facilities and medical expertise needed complete with pre psyche test and follow up care.
And women go into the backyard for abortions, I’d imagine, but I doubt they keep statistics on it at PSA. The moral climate is what determines medical availability, I think. Not so much lack of competence.
I give up! I tried 3x posting a link of the index of countries with the best health care 2025 without any success.
in that lost link, thailand outrank philippines: thailand is ranked at 9, while philippines ranked at 41. and united states is ranked 38.
It went to spam for some reason. I’ve dug it out.
https://www.numbeo.com/health-care/rankings_by_country.jsp
apparently thailand outranks philippines as regards health care.
And outranks by far. Thailand has one of the best healthcare systems in the world due to conscious effort since the 1980s to build the public to private pipeline I described elsewhere here. They started from nothing with humility and built brick by brick. Something that the Philippines can take note of rather than trying to reach the pinnacle in one step.
I’m also shocked that Venezuela ranks lowest. In my travels of Latin America, Venezuela used to be the crown jewel of South America before the far-leftist Chavistas took power. Best economy, best healthcare, a high level of technical expertise and education. Venezuelans mostly built those former riches on their own along with smart leveraging of FDI, unlike the Philippines “Golden Age” that was buoyed by pre-1970s American largesse. Now Venezuelans are fleeing as economic refugees. Truly a scary example of how quickly a country can descend into chaos and destroy everything.
The Pogo crackdown left many unsold condos.
Not that I want Pogo to make a grand return, but this would be an opportunity.
I suspect the urban areas are overbuilt both on condos and commercial space, and hopefully the real estate people and banks that hold their loans remain above water. They weathered covid and BPOs have AI ahead, so nothing is certain. I’m impressed by the use of condos here as near-hotels. Booming business. I think a medical BPO could make use of them nicely.
https://www.philstar.com/business/stock-commentary/2025/02/07/2419873/colliers-ph-metro-manila-has-82-years-condo-oversupply
We should turn this crisis into an opportunity.
POGOS should not have been the main market in the first place.
That’s true, they were always a fools errand. I wonder if the reclamation projects have been hit by the POGO exits. But I tend to think the overbuilding is more catering to Filipinos who buy them to rent out. The financial reality to that is that it is not really easy money.
The Universities have condos near them fully occupied. Maybe it is all about location as the old adage goes.
Maybe this fifteen minute to everywhere developments might work.
Makes sense to me.
While this is an intriguing proposal, I think there are some glaring issues to be addressed:
1.) Many of the best Filipino doctors and nurses already go abroad. The leftovers are often domineering, incompetent, sleeping with students (in the case of teacher-doctors or teacher-nurses), etc. am quite familiar with these cases as I travel about. How medical staff treat “foreigners” like me is vastly different from how they treat a typical Filipino, especially one who does not have the funds. Once had a medical emergency in Cebu and got care at Cebu Doctors, supposedly one of the best hospital systems in the Visayas, and I was not impressed. A lot of pretty nurses who made papansin to me though, which cheered me up a bit, hah.
2.) Medical tourism usually caters to services such as abortion, general surgery, fertility treatment or birth surrogacy, and in the case of higher staff/facilities it can be plastic/reconstructive surgery. While I don’t doubt there are facilities in the Philippines that can do these procedures (aside from abortion), my personal policy is I wouldn’t trust going to the Philippines when I’m in bad health.
3.) Even with Trump, most Americans get their medical coverage through employers, which won’t be affected much as medical coverage is one of the benefits that employers use to compete on the labor market. Those Americans who desperately need medical services are mostly poor, including poor White MAGA, and can barely afford to travel outside of their locality much less to another state, or another country. Those who can travel for medical procedures likely would avail services nearby in Canada or Mexico anyway where the quality of service is very high, travel expenses less, and there is more certainty than the Philippines.
4.) Personally I would rather the Philippines government focus on providing better medical services to Filipinos. It should not take me, when mistaken as a Filipino or even “half Filipino,” to clearly state that I’m American, to then have the level of attention (and respect) increase dramatically. I shudder to think of what normal Filipinos face when addressing their medical needs. Well actually I don’t need to guess because I have a pretty good idea. When children are malnourished, routine vaccinations are not “free” (to use colloquial usage), people are being held hostage illegally by hospitals, it seems to me that the Philippines “house” needs to be put in order first before pursuing what amounts to catering to patients with more means, including foreign ones.
5.) I was in the Philippines when the COVID Delta Wave finally hit around summer 2021. What I saw was terrible. Despite months (almost a year actually) of watching Europe and the US suffer, there was a sense of denial by both Filipinos and the former administration. I saw very few signs of precaution, masks being worn wrong, people just accepting death — which by the way the government had completely underreported numbers. Hospitals with long queues of ambulances and private cars, people strewn out beside motorcycles sucking on shared oxygen tanks. Patients were not triaged at all according to need, but according to ability to bribe hospital administrators. After my ex’s father was refused at Cebu Doctors due to line cutting by bigger bribes, I was finally able to bribe the staff at Vicente Sotto Memorial Hospital 150K. Well her father died shortly anyway. On the death certificate it said “pneumonia with history of tobacco smoking,” despite clear Covid symptoms and her father have never smoked cigarettes in his life. Truly many Americans died due to Trump’s incompetence, but at least hospitals were triaging patients properly and taking as many patients as possible.
6.) Granted it can be argued that this proposal can be a private initiative, but to what end? The privatization of most critical functions already exists in the Philippines and is a great contributor to the social divide of what I observed as the “two Philippines.” The haves can afford what they need, and what they want. The rest have to make do, or otherwise accept lack. I’m not against private industry, including medical, but clearly there has to be more government focus on at least a baseline that protects Filipinos’ health and welfare. Would a Philippines that somehow becomes a top 10 medical tourism destination be proud to show off a few city blocks over, much less the rest of the country?
P.S. Apologies, I’ve been quite busy the last week or so with work.
Thanks for the observations. Let me address them in order.
1. Yes, the medical arena is spotty as to expertise and would have to grow into the proposed BPO industry. My experience is different than yours, entailing numerous exams, PET scans, brain MRI, lung biopsy by a needle through the back, heart exams, excellent doctor advice, and superb nursing care. Life-saving in fact. Some medical practices here are not appropriate for international visitors, like no appointments, mandated watchers, and capturing patients until bills are paid. But the idea is a starting point to build on, so that is for hospitals, doctors, and governments to address. And an enterprising BPO.
2. There are world class facilities and doctors here. If they can’t in fact be delivered to patients then the idea would not succeed.
3. We’ll have to see. Canada would be high expense, Mexico would by low on trust. Diabetes patients, the elderly, and expenses moving up to hit the middle class hard. Canada and Mexico will soon be at war with the US, so there is that. Trump and Musk are messing with health care for sure. It’s unstable. The Philippines is known for quality nursing care and has a reputational edge.
4. Oh, absolutely yes. But it is not an either or choice.
5. Every country went through hell on covid. Hospitals learned a lot, too.
6. Restatement of 4. It is not really the issue, that Government needs to be doing a lot better. A private initiative would put the pieces together, factoring in medical, housing, and visa, and I suspect be a kernel of energy that WOULD move the medical industry to better overall care for Filipinos.
In the private sector there is no lack of services available in the Philippines, including medical, provided the customer can pay for it. Certainly I’m not opposed to the private sector providing such services. Private businesses, including private hospitals, put up their own investments and there seems to be no shortage of cash to be invested sitting around among the various conglomerates so they probably don’t need direct government intervention. However I think without a government policy to increase the medical outcomes for regular Filipinos firstly, I’d question where the effort is being allocated — to increasing the divide between the “two Philippines” or towards decreasing that gap.
We should also consider that as “rich foreigners,” and especially being American, we likely receive preferential treatment. Now, I may be part Caucasian but I’m not obviously so at first glance. Hate to bring race and ethnicity into this, but often there is a vastly different experience for White people in the Philippines, even from “poor” Southern and Eastern European countries who are still seen as rich apparently. When a sometimes rude Filipino realizes I’m American, they often suddenly change their tune. As such, that was part of the very reason I was able to bribe Vicente Sotto’s staff to admit my then-girlfriend’s father. Note that Vicente Sotto Memorial Hospital is a government hospital, and the supposedly top government hospital in Central Visayas, that is by law obligated to take all patients regardless of ability to pay.
I’m not disputing that there aren’t world class medical facilities and medical staff in the Philippines — there are, and St. Luke’s and the Philippine Heart Center in Metro Manila come to mind. I have a good friend who was previously a surgeon at the PHC, but he had eventually migrated to the US where he now works for the University of California medical system as a tenured medical professor. But given limited government funding and agency bandwidth, it seems to me that most of the effort should probably be focused towards increasing the health of Filipinos who are wholly indigent generally or need partial assistance through a means-tested policy.
Case in point, in major metros like Manila and Cebu, there are plenty of dialysis centers that provide a high level of care for those who can afford it. Given the signs of undiagnosed diabetes I’ve seen in DEs, government attention might be directed towards preventative care, health education, maintenance medication, up to dialysis on a means-tested basis if needed. Too often I’ll hear of someone I know have their relative die from undiagnosed diabetes, and those Filipinos have just accepted that their relative died “suddenly” because “God called them.” That should be unacceptable.
Canada isn’t as high expensive as you may think, nor is Mexico as low trust. One can quite literally walk across the border with Canada and request medical services, and be given that medical care with the same lower bill Canadians get. Now that would not cover elective surgery or non-emergencies, which would need to be both scheduled and incur higher costs, but the cost is still much lower than the typical American hospital bill. With Mexico, one would need to pay, but it is much cheaper than Canada, with a very high level of care. I really doubt Canada or Mexico would be at war with the US. Things are relatively calm here in the US, and Trump had completely folded when met with the slightest push-back from both Canada and Mexico. Trump and his acolytes are more than happy with grifting and stealing public funds here in the US of which there are many, just like the last go-around. Wars would stop their ability to steal as now an existential external threat comes to the forefront.
The Philippines is known for quality nursing care — based on Filipino nurses abroad. This doesn’t quite translate to the medical care back in the Philippines, especially when the best and the brightest nurses leave and go abroad. The quality of nursing back in the Philippines can be then inferred based on that. I’ve seen the nursing coursework in some major Philippine nursing programs and it is atrocious per my NP brother’s comments. A lot more SN’s actually don’t pass the board and fade into the background than families are willing to admit. Here in the US, when my brother went through high BSN program after leaving the finance world, the attrition rate was very high closer to the beginning of the 4-year program, while from my observation, Filipino SN’s that should’ve failed out are seemingly kept on to milk their tuition fees by unscrupulous private universities (even some big name universities).
Now after that criticism, how about a constructive point:
The Philippines government should consider a reform and expansion of the government-funded hospital systems, open more major and minor medical clinics to tackle preventative healthcare, and infuse the notion that patriotism can be caring for the health and welfare of the nation. And pay government doctors, nurses, and MA’s more to encourage more graduating doctors, nurses, and MA’s to stay in the Philippines to be part of that project. The private sector already receives way too many subsidies direct and indirect, and has been allocated way too many government concessions whether official or by looking the other way. I’m sure the private sector can take care of itself in the end.
In Munich, a lot of clinics maintain above average service levels in a time of cuts to medical insurance coverage and clinic funding thanks to cash paying politicians from many countries and large scale Arab medical tourism by the very wealthy from Gulf States.
Couldn’t money from medical tourism somehow be utilized, for instance, by taxing the private sector hospitals (sensibly, of course) to improve public hospitals? Munich clinics serve both publicly insured patients who have to wait for surgical procedures that aren’t urgent as well as Arabs who allegedly have an entire floor in one clinic with personnel that speak Arab. The surgery clinic in the center of town has a desk for cash paying foreigners, but I guess their lack of personnel (friendly but short on time was my experience) would be worse without these.
Re Mexico, possibly Joe’s POV is from before. There is this line in Once Upon a Time in Mexico where an American asks a Mexican whether he is a Mexi-CAN or a Mexi-CAN’T. My personal impression of Mexico today is that it is mostly full of Mexi-CANs..
Indeed Mexico has gone a long way. Also important to note that as the central hub of the former Spanish Empire, Mexico has always been ahead in the first place compared to the relative backwater Philippines. That’s before considering that the pre-Spanish Americas already had organized states and empires, while the Philippines had none.
A lot of the bad image Mexico has is actually American right-wing propaganda that has filtered down into mainstream consciousness. I’ve been going to Mexico off and on for well over 30 years now and I’ve never once felt threatened for example. Cartel violence is mostly against other cartel members, and is mainly isolated to the rural areas. Mexican cities, especially the bigger ones, are usually very well run.
The Mexican economy is very diversified, and is the 13th in the world. So they must be doing something right despite the pervasive problem of wealth inequality. Mexico is rapidly modernizing with salaries increasing by quite a lot under the recent government.
During my trip to Mexico last December, I was amazed at how things are there.
Some stuff reminded me of the Philippines, such as the insistence on recibo, especially in government offices, but there was way less hassle and hustlers except in one place.
Armed guards and military were remarkably chill even as their porma was remiscent of Pinoys in uniform, but they didn’t act like little kings at all in my experience.
Mexicans, and Latinos in general, are very hard working as well. There aren’t many tambays in Mexico — people look for work, if they don’t have work. The few tambays I observe from time to time are bullied as “not real men,” so there is a social aspect reinforcing a go-getter work ethic. The economy in Mexico has gotten good enough that there was a steep drop-off in Mexican illegal immigrants to the US. Mexicans want to stay home close to their own families, build small businesses, and build their country. Now Mexico herself is having an issue with illegal immigration from Central American countries and formerly protestors but now failed countries like El Salvador and Venezuela.
By the way, the recibo thing exists in Spain, as well as other Hispanized or formerly Hispanized countries. My understanding is that it is an old cultural practice, a form of proof of a transaction or agreement. You’re right there is little friction for recibo in Mexico, compared to on the Philippines where paperwork and official documents are often more like a form of pageantry of official-ness. Well it is OA there.
A lot of Mexican soldiers hail from more rural parts where there is still a sense of Western honor, similar to old cowboy movies. Of course, American cowboys actually were inspired by Mexican vaqueros and Black American former slaves who had escaped across the border of the Mexican Northwest, which later became the American West and Southwest. They also know how to shoot well growing up on ranchos and farms. I spent many a summer in my youth in Durango staying at a rancho of the abuelo of a good friend.
many americans go to mexico for elective treatment where medical procedures can be booked in advance. it is apparently cheaper by 50 – 70 per cent to have them done in mexico. I doubt if americans travel all the way to the philippines for elective treatment, mexico is nearer and affordable. american health insurance only works in america, it is not philippines specific. probly meant that if americans have procedures done in philippines, any harm done or any medical misadventure incurred, they are responsible and their american insurance is not likely to compensate them.
One has to imagine what the American health circumstance will look like when Trump gets done wrecking it, with no health insurance, no vaccines, no control over costs. Outrageous insulin prices. Then focus on high cost, long term patients. Cancer patients come to mind. Or elderly care. I agree that’s a horribly long airplane flight so you’ve highlighted a pickle in the strawberry jar. But the medical care business is going to move out of the US, and the Philippines should get its cut. That’s my premise.
This probably cannot happen, as healthcare in the US is mostly employer provided. The US healthcare system is largely already private. As for those on Medicare and Medicaid, which many Trumpers are on, let’s see how fast they howl and change their tune when they realize that when they said they wanted stuff to be taken away from “undeserving” people, that they are also now considered “undeserving.” Signs of realization and pushback are already appearing.
I’m sorry to say, but I highly doubt a private medical tourism industry can happen in the Philippines when the Philippines often can’t take care of her own. There is just not enough competent medical personnel available, and the government designating a handful of well known institutions like St. Luke’s or PCH is highly telling.
You could be right, for sure. But in my scheme, it’s not driven by the hospitals or the government because it’s outside the scope of hospitals and government has zero problem-solving initiative. And Department of Tourism is an advertising body. Yet the medical services are here and can grow if money comes in. Foreigners can bring in the money.
Well I think that depends. I’m still of the opinion that Filipino tycoons have the requisite capital to accomplish this a long time ago, and certainly now. But if the tycoons are ready, and the Department of Tourism can facilitate, why not?
I do think there is some kind of disconnect here on why exactly many foreigners come to the Philippines.
Beaches, babes, and . . . well, more beaches and more babes. I met in passing a Swiss gentleman who was at Chong Hua for his medicine while traveling. A nurse was chatting with him and said something to the effect of “you must find us lacking your sophistication”. He looked around the big room with patients being treated and said something to the effect of “No, I think you’re very good and I appreciate your taking care of me.” Some things the Philippines does well, on occasion. We should not bury the good because the bad really stink.
I don’t go to the Philippines for the babes. Plenty of beautiful women right here in America 🤣
Well Chong Hua is the premier hospital in Cebu, and I’m sure you received great service there. The story other institutions is not as great. Take Cebu Doctors for example — brand new facilities with an expensive price to go with it, but the service is wholly subpar.
I’m really not against your proposal. Rather I think a few shiny examples is not representative of the whole, which is not that great. In the Philippines, lazy thinking by politicians often seeks to elevate the few shiny examples and then ignore the underlying problem. See? There’s a shiny there! Problem solved! Suppose here that the successful institutions can be replicated. That would only be a good thing, especially if the focus is initially on improving health outcomes of Filipinos. After all, I would not feel that great about treatment in hospital where the staff are underpaid and overworked, and do not receive continuing education to reinforce best practices. Also note that the best Philippines hospitals tend to be “Chinese” owned.
They cannot get well paid until the economics of service move up. In the meantime, that salary scale provides the edge to bring the money in. My experience is that the nurses laugh a lot, are attentive and skilled, and sometimes have to work really hard to take home 30,000 to 50,000 per month. Of the, say, 20 doctors who have attended to me the past few years, three are Chinese, two are half-Chinese, and 15 are Filipino. The sharpest was the emergency room doctor, Filipina maybe age 40, who could slice and dice symptoms so incredibly well and record it all in her handheld device so she had a history the next time you moaned in. Truly incredible. Many business owners are Chinese as in the US, they are Jewish. No matter.
Chong Hua Main is getting old. Chong Hua Mandaue is superb. And Chong Hua now has a “medical mall” that is a specialist outpatient building with full service labs and equipment, but no beds as a hospital would have. the last time I was at Mandaue it was very jam-packed. Parking was full. Crowds in every department.
The salary in the Philippines for trained experts is the sad part to be honest. 30K is not much at all for a BSN graduate at the top of the nursing field, when a comparable salary can be earned as a BPO CSA with 6 months experience and a SHS diploma, provided the agent knows how to hustle their way through promotions. Truly, one of the sad reasons why good nurses and doctors feel the need to go abroad where they can earn let’s say $80K a year at a rural US hospital with overtime, $120K in the city (330K/mo to 500K/mo). Like I had mused about in our various other topics regarding manufacturing, I’m convinced many Filipinos who go abroad would rather stay home closer to family with a lesser salary provided that salary is commiserate to their experience and degree level.
I heard that Chong Hua Main is set to have a major renovation, or at least there is talk of such. Chong Hua isn’t that accessible to local Cebuanos, due to the cost, so I do hope there is a government initiative to improve healthcare for Filipinos across all facilities both public and private.
Well, I can’t relate to feeling sad because, for one thing, Filipinos make the bed in which they struggle, and will elect actors. plunderers, and self dealers to office later this year, and, for the second, I do what I can do to help, often upwind. Sadness seems to me a wasted emotion. 30,000 is a livable wage in the provinces. It’s harder in the cities, but people get by, and fairness is not a law. In the US, I’d not be able to buy anything but a trailer home out on the desert, or I could sleep in a box on Fourth and Main, so I fail to see the glory of the USA. And here there’s no freaking snow.
I think they work steadily on the hospitals. Biliran has a brand new facility. Cebu has about 20 hospitals, the most expansive seems to be Perpetual Succor with five or six buildings, the newest a 14 story facility, totally modern. I visited with a surgeon there, 11th floor corner suite, nicer than any office I had as an executive in the US. So I suppose medical care is like the whole country, layered from poor to rich.
Good to know about Chong Hua upgrading.
In my observation, it is quite hard as if a few years ago to support a young family and aging parents on a 30K salary in Cebu. 50K would be the starting point.
Not sure how long it’s been since you’ve visited back home in the States, but I disagree with the notion that life is that hard here to the point where people would end up in a mobile trailer home in the desert or be homeless in the inner city. For example at my home, I rent out 3 spare bedrooms to boarders, all young students. They seem to be able to go to school, pay for their car installment, afford to eat decent food, pay their rent, afford a bit of occasional luxury, all on a student’s part-time income. My other properties are fully rent out to single families, and they get by just fine to with multiple cars and the latest TV or iPhones. Actually, they would tease me that why, as the landlord, I had been using a nearly 5 year old iPhone. Well recently upgraded to the latest iPhone.
I’m plugged into the Philippines BPO industry, at least in Cebu, Mandaue, and Lapu-Lapu. I know that definitely agents can earn 30K a month with just a high school diploma. Supervisors can earn 50K. Earlier today I had a bunso friend report back that she was promoted immediately to supervisor at her new BPO employer. Her old BPO catered to low-end clients and her salary was barely above minimum, so her initial 28K salary at the new place, and her newly approved 40K+ supervisor salary is a big improvement that will enable her to take care of her two children, as her kapuso/kapuyo (partner) is a completely useless man. She is also starting a VA part-time job that pays 25K a month. So it’s examples like this which inform me on the state of how fairly medical workers are compensated there. Sure, some due to dedication to the community or due to family reasons may stay at home serving Filipinos, but most Filipino nurses and doctors would probably take the opportunity to go abroad and earn a 10x+ salary in a heartbeat. To retain more talent, the solution is simple: they just need to be paid more.
Middle class families require multiple incomes both in the US and Philippines to deal with the rising costs of housing, a problem in many countries, including the US. Not to mention eggs. Students have to be enterprising to persist, sharing rooms in dorms or apartments, and borrowing money to pay for tuition. President Biden worked diligently to erase those student debts. That won’t happen under Trump. Canada and Australia are reducing student visa allotments to relieve a little pressure on housing demand. The reality is that it is a struggle in the US as it is in the Philippines, but enterprising and hard working people can find a path either place. Of course a nurse in the Philippines would love a nursing job in the US. Doctors take them. But that entails sacrifices and processes and a confidence that Trump will consider nursing to be the kind of job immigrants can take on.
For my project, the reality is that costs in the Philippines are materially lower than in the US, the fairness or pain of that being irrelevant. And medical care is substantially the same as in the US, at top hospitals. That’s the cost-benefit gap into which some enterprising soul (or BPO) can step to the benefit of both Philippine medical progress and Americans’ health.
President Biden reversed some of Trump 1.0’s policies in regards to facilitating the visa process to staff rural American hospitals with doctors, nurses, and pharmacists from the Philippines, India, and Nigeria. This was in addition to increasing federal funding to those rural hospitals, which due to distance might mean the difference life and death for let’s say a heart attack patient. Trump 2.0 is beginning to take those improvements away by (illegally) pausing Congressionally authorized funding. This would hurt Trump’s voters the most, and like Trump said, he only needed their vote one more time and then he wouldn’t need the votes again. Take that paraphrased statement with what you will, but it’s clear that an electorally unconstrained (whether through term limits or attempt at auto-coup) Trump has become enamored with billionaire backers and dropped any pretense of helping his supporters. Well, like I said, sometimes people need to get their hand burned to learn a lesson if they keep insisting on playing with a hot stove.
Back to your idea, I still have confidence that no foreign investment would come in to accomplish the medical tourism idea for the reasons I outlined. No foreign investment would sink investment into this when they can milk existing their various domestic healthcare systems. However, Filipino tycoons are sitting on a decent pile of capital that is largely idle. Filipino tycoons can build out this idea. Whether they would stop being so risk-adverse with anything that isn’t blatant rent-seeking is the million dollar question.
I’d be happy with a tycoon deciding to become the master of the idea and examine how the risks can be wiped out and the profits rolled in.
Definitely. And the Philippines government can help by facilitating visa process and requirements to give more certainty. It’s maddening how risk-adverse Filipino businesses are though. With the capital on hand they could invest into a lot more eventual profits. It seems there are two types of businessmen, the rent-seeker and the gambler who parlays a weak hand. It seems to me that the top Filipino tycoons are starting off with a strong hand yet they don’t want to use those cards for some reason.
I’ve not really studied them. I was interested when San Miguel a few years ago stepped outside of beer into infrastructure development, then mightily impressed with their boldness in proposing to build a new airport, then moving aggressively forward to do it. I hope they make a lot of money and continue to build the Philippines. I think my project would be a gnat in the eye to their ambitions, but, boy, how magnificent if their build big style were the foundation of improving profitable health care in the nation.
Sometimes it might take one oligarch family’s heir to be more forward thinking and strike out in new, profitable, ventures to cause the rest of the tycoons to lose their fear. As it stands Filipino tycoons are quite financially cowardly. The smell of new ways of making money is strong though so hopefully that is an incentive if examples are shown to work. So in that regard what San Miguel is doing is good, and paradigm shifting.
I see them as conservative, not cowardly, and critically important to the stability of the nation’s economy. In that vein, I like them being conservative. Also, San Miguel’s airport build seems bold to me, not conservative. The oligarchs are good at what they do. Well, with exceptions. I prefer them to, say, Bezos, Musk, and Zukerberg.
It could be that it simply is due to an underdeveloped capital market in the Philippines, meaning no powerful banks that back (and act as guarantors to) big investments like the big banks of “Germany Inc.” and “Japan Inc.” and even if it seems that has improved in past years, not much of a stock market, even as I have been told Jolibee made extensive use of the stock market and has been on buying sprees, but then again the Caktiongs are newcomers not so established.
By some indications, being forced out of their comfort zone twice (nearly complete disbandment under Marcos Sr. including jail time and escape for one of the older Lopezes and, of course, loss of franchise under Duterte) has made ABS-CBN more enterpreneurial. Sure, they have their captive markets like the overseas Filipino TFC streaming crowd, but there is the interesting figure of the youngest (late 40s meaning young Gen X in a shop run by boomers) member of senior management, Laurenti Dyogi, son of a jeepney driver originally, who shaped Pinoy Big Brother as a new pipeline for stars coming from more normal backgrounds than the usual nepo babies and recently the creation of idol groups where one invests in training, something unusual in a company that used to just milk (and quickly drop once “laos”) singing contest winners without any investment whatsoever. They are also creating teleseryes shown in places like Cambodia or parts of Africa, definitely not yet at the level of K-dramas because the storytelling is still often cringe and OA, but the quality of cinematography has gone up.
Still, I have read that ABS-CBN recently had a special stockholder meeting where the CEO spoke about restructuring loans. In a more mature economy, there might have been banks who got behind them, or ways to raise more money on the stock market. The conservatism of Filipino oligarchs is also due to them being practically on their own. And in a low-trust society, you can’t really go into a minority stockholder position like Susanne Klatten who has 33% of BMW or so.
One of the first things many Filipino parents teach their kids is “huwag magpalamang,” i.e. don’t give any other an inch to take the advantage you have gained. Being fair and collaborative in the Filipino context can be seen as weak. Pirates of the Carribean morality but less funny.
Of course, the rule on limits to foreign ownership made many oligarchs rent-seekers, IIRC, that is a legacy of President Carlos Garcia’s Filipino First policies. A lot to look into actually..
From 1970, Philippines Free Press:
..THREE LAYERS of wealth have accumulated since the turn of the century and Senator Aquino identifies these layers with lands, politics and banks.
“When the Americans came, a group of young lawyers started titling lands: this was the beginning of the big estates. Gregorio Araneta, for example, became the lawyer of the Tuason family that claimed this tremendous tract of land from Sampaloc to the Marikina Valley. The original source of the Philippine fortunes was, therefore, land—either Spanish grants, like the Ayala estate, or the acquisitions titled during the 1900s.
“The second generation of Filipino wealth came from government connections. In the 1920s when Quezon was financing his independence missions, certain people got choice contracts from the government, like the Teodoros of Ang Tibay, the Madrigals of the shipping line.
“Then we have a third generation of millionaires: those who got concessions from government financing institutions, like the sugar barons. The Philippine National Bank was set up and it financed practically the entire sugar-mill construction of the period. The movement was from Negros Occidental to Iloilo and the sugar barons—the Lopezes, the Javellanas, the Aranetas—started taking over virgin forest.”
The PNB marked an important development: Filipinos—or, at least, some Filipinos—began to have access to capital. Previously, all banks in the country were foreign-owned. Not until 1938 was the first Filipino private commercial bank founded: the Philippine Bank of Commerce. And only after the war, during the Garcia era, did the native entrepreneur really understand why he should have his own bank.
“This cue was Garcia’s Filipino First. The Americans in the Philippines, the British, the Chinese—they had their own banks. But Filipinos had only the PNB to rely on and even there they were not, so to speak, getting the lion’s share, because the Chinese were more adept in the lagay system. So, we began putting up our own banks. The Rufinos set up the Securities Bank, the Santos family, their Prudential Bank; a group of sugar planters (Sarmiento, Antonino), their PCI Bank; and young professionals, graduates of foreign schools, came back and put to use what they had learned by establishing a bank of their own : the Far East.
“There was this proliferation of banks because the Filipino had suddenly realized that money begets money and that he who holds capital can control the economy. The development of native banking system spurred activity in all directions. Now, for the first time, the Filipino had his own capital. On it, he could borrow foreign funds to use for his own development. So, you had the opening of subdivisions, another source of funds, of capital, and you had the rise of local manufacturing industries, all financed by local banks. This is a healthy sign: the Filipino is becoming the master in his own house.”
But Senator Aquino sees one great danger: the Filipino who becomes master in Juan’s house may not be Juan de la Cruz himself. Juan may find that the foreign exploiter he kicked out has been replaced by a native one. “The Spanish exile, Salvador de Madariaga, warned that a country can become the colony of its own people.” And the hurt is that it’s Juan’s money that will be used to make him poorer and his master richer. As the taxes that Juan pays to the government too often are used merely to enrich a few politicians, so, in the banking system, the money of the depositors, of the people, may be used merely to capitalize the owners of the banks.
Senator Aquino says that this is already happening..
Of course, there were those who suddenly went poor or migrated to keep at least some of their wealth like some smaller sugar planters in the time of Marcos Sr. when sugar prices dropped AND Marcos crony Roberto Benedicto was given some power over that market – one has to look at the sugar planter background of major LP players and the (originally sugar barons) Lopez family (and the tobacco trade background of the Ilocanos on the other side) to get some political alignments including why Iloilo is so solid yellow and Pink.
As for virtue being lack of opportunity, there are hints of my folks having lost out in the titling spree of the early 1900s, and possibly that inspiring my grandfather to study law. That my grandfather sold a lot of what was left to the geothermal plant, A Marcos Sr. project, cheap, whether voluntarily or not, is a story I don’t want to go deeper into. It is water under the bridge and what is essential is to change a society of “take what you can, give nothing back” (Pirates of the Carribean) into a society of real opportunities and enterpreneurial drive, not easy.
Thanks Irineo for sharing that old article. It was very enlightening to read how Third Republic thinkers viewed problems. Ninoy was such a far thinker for his time.
I don’t think having powerful banks is as much of an impediment as let’s say, the lack of an “expeditionary mindset” in the Philippines. In the US context this expeditionary mindset is the rugged can-do frontiersman ideal, though it exists in European forms as well such as in the UK , France and Germany. It also exists in Asia and Africa. In Asia, countries like Japan, Vietnam and Thailand have an expeditionary mindset in my estimation. Historically inwardly looking countries like (South) Korea have evolved to adopt an expeditionary mindset. The expeditionary mindset has an assumption of pushing the boundaries, previously through territorial conquest, but nowadays through economic conquest. In countries where people’s needs had been traditionally met under easy terms seem to not develop this sense of adventure and urgency, because why should they? In former times everything that is needed is just close by.
That being said, the development of banking did make better use of capital (generally), which enabled investment in new ventures. Elsewhere I see others doing more with less, and not complaining that much about needing to sometimes take the hard road as long as they have clear vision of where they are going. A problem I constantly feel annoyed about in the Philippines is the seemingly ingrained apologia that defends and excuses inaction. It’s always because of this or that. Well, can’t really move forward if mistakes are excused. Mistakes are meant to be learning opportunities. Filipino tycoons absolutely have the capital and wherewithal to make things happen. They would even reap the majority of the results of the efforts. Yet they are seemingly content to take risk-adverse strategies, not waiting to invest even a fraction of their capital. One would wonder if Henry Ford, or Ferdinand Porsche had a similar mindset, if the American and German auto industries would be where it is today.
Well, one big player in the German auto industry is in big trouble because they became a bureaucracy of sorts – Volkswagen. Meanwhile, BMW is still at least a player because it did more in developing electric cars. They were nobodies just after the war, BTW.
Philippine companies are probably often places where people are not really wanting to recognize mistakes as lessons learned on the way forward. It might lead to doing things in such a way that you can’t be blamed and covering up mistakes, so a lot of stuff just stagnates.
I’m not fully familiar with the corporate culture of Volkswagen Group, though I do know that Porsche had basically taken over Volkswagen when those two companies merged. Here in the US, there is a lesson of the dangers in corporate bureaucracy run by MBA types following the philosophy of the late GE CEO Jack Welch. For example, McDonnell Douglas was a failed company run on those principles, but MD’s corporate culture somehow took over Boeing’s engineer-driven culture. I wonder if Porsche’s leadership follows the Welch model as well. The Welch model is very prevalent in mature US companies now due to legions of Welch acolytes spreading across the corporate and academic landscape. The Welch model is a rent-seeking model by MBAs who do not know how to invent new products. I haven’t had a chance to look into whether that corporate philosophy has permeated into the Philippines as well, to the point it would be a contributing factor to inaction.
“Pirates of the Carribean morality but less funny” is terrific literature. And funny. Thanks for the brief on how the oligarchs were hatched. I like them myself. They are competence, an oasis in a desert, other than an occasional Cebu Pacific mash up. They were bamboo during covid, very impressive. PNB is our main bank. Nice to know how they were formed.
These electives that Americans go to Mexico and Canada to get done are mostly cosmetic in nature. Dental implants for example are popular, as are Botox or cosmetic surgery. Other than that some Americans who live near the border go across to buy generic medicine for much cheaper, as the generic version is not available in the US under the broken US patent system that protects corporations.
For serious conditions or medical emergencies, any American can go to the hospital, obtain complete care, and if they cannot afford to pay for it, the government will pay for it under various programs for the indigent such as Medicaid.
My assumption is your statement will not be true a year from now.
Well given the observation that a lot of the MAGA cult seem to be angry poor rubes, it would not be me suffering. I’ll begrudgingly get another tax cut, and probably not need to pay the anticipated estate tax as my brother and I transfer properties to the family trust we had created recently. As much as I don’t wish ill on others, sometimes the only way some people will learn is if they get their hand burned.
No question, but the destruction has begun, and medicaid and obama-care are in the gun sights. And vaccines. And price caps on insulin (already gone). Kennedy is in charge of health. Federal health research has been shut down. If I were sick, seriously sick, I’d be highly anxious. That’s the market the Philippines can sell into.
That’s not what I’m seeing here in the States. Even in the worst case scenario which negates the immense power individual states have in the US federal system, it is likely most Americans would come out “fine.” Federal funding is substantial but the state-funded portion usually outstrips the federal contribution that seeks to fill in the gaps. Certainly would still better health outcomes than Philippine expertise or capacity can handle. Most Americans who will suffer will be MAGA rubes residing in red states, and it’s time they got a taste of what voting against their interests tastes like. Those Americans can barely afford living paycheck-to-paycheck, and can’t afford to travel to another state for healthcare, much less travel across international borders for the same. My state is by some measures would be the 4th most economically powerful country if independent, and other blue states are similarly well-run — those states will be just fine.
medical tourism, kidney transplant that used to be big earners for private hospitals in philippines had been banned. and foreigners in need of new kidney can no longer avail of filipino kidney unless they are related like husband and wife.
https://www.cbc.ca/news/science/philippines-to-ban-foreigners-from-receiving-kidney-transplants-1.745293
tourism dept needs to be specific and itemize as to what constitute medical tourism.
Yes, for sure. I don’t like the “tourism” description as it misstates why people are visiting, for medical care. I suppose my hypothetical BPO operator would work with government to develop a menu of approved treatments they can offer, and maybe even get a “medical care visa” designation.
I still don’t think the proposed model is workable, even if I agree it’s a good idea in theory. The main sticking points is that BPO caters to exclusively soft-services that can be uprooted and transferred across borders based on customer needs, and the other is that a foreign company investing in healthcare would rather milk their own domestic market where there is a captured clientele. In fact the bread and butter of the healthcare industry in the US are Medicare/Medicaid patients where the money is smaller but the revenue flow is guaranteed. You may also be surprised how much local Filipino “business partners” actually invest into a BPO operation. Often it is little to none. The local partner is just there to facilitate around the legal requirements of limiting foreign ownership. This is where the local BPO partner get their cut.
You are now Chief of Brainstorming for the blog. Way to roll with it!
I’m not familiar with healthcare in Germany so I’ll have to generalize based on what you shared. But yes, there isn’t anything wrong with private institutions catering to what we call here in the US “platinum patients” (cash paying patients for premium care). I think it might be safe to say that Germany probably has a lesser problem with corruption and tax evasion than the Philippines… imagine cash services in the Philippines and trying to collect taxes from that!
Here in the US, most public hospitals actually have better trained and more experienced medical staff than most private hospitals. Though granted the “platinum” service hospitals catering to affluent patients do have the best doctors usually by way of those doctors being paid much higher salaries. Here doctors and medical staff who work for public hospitals usually have a sense of service, want to participate in a teaching hospital perhaps, and thus accept lower salaries when they could get a higher salary at a less well run non-platinum private hospital. American states and large metro sized cities take pride in funding and maintaining their state and city hospitals, as well as recognizing the public good in such institutions.
Over here in Munich, it is basically the university hospitals that “rule,” and they have the best doctors, some even professors of medicine. They will accept private AND public patients, and of course, the cash service is paid via a central cash register, which I presume is tamper-proof. I don’t know if there are doctors who make direct cash treatments on foreign patients because that would presume a trust relationship, but who knows.
Anyhow, the reputation, especially of one university clinic, is so good that even Southeast Asian politicians come over. There are also numerous private clinics that accept only privately insured or cash (meaning cash, debit, or credit card) paying patients I know very little about.
Occasionally, I see the Filipina maids of Arab medical tourists over here.
Ah here in the US the research hospitals, many of which are affiliated with universities, also rule. American research hospitals often have the latest cutting edge medical practices and equipment. The problem with high prices in the present US heath system mostly relates to for-profit hospital consolidation, not so much the non-profit institutions. Nevertheless, by law any hospital is required to treat any patient without regard to ability to pay if the hospital receives some federal funding, which almost every hospital does receive. Treat first, send bill later.
Here in the US the medical providers who cater to platinum patients are usually providing those services out of a private medical practice, like in the case of out-patient surgery that doesn’t require admission to a hospital. Most hospitals here don’t accept cash as payment, only cheque or electronic. I have a Persian surgeon friend who graduated top of class from USC, then did his residency at UC, going on to being a reconstructive surgeon specializing in skin graft for burn patients in the top university burn clinic on the US West Coast. He now runs his own medical practice, giving young women (mostly from Muslim countries) their “virginity” back before the young woman gets married.
you must have heard of wealthy chinese women coming to estados unidos in the 1st tri-semester of their pregnancy and pre-book themselves places in top americal private hospitals and give birth there, their babies made immediately american citizens by nature of its birth being born in american soil. apparently trump is stopping this practice.
Birth tourism isn’t a very major problem in the US. The talking point originated during the Civil Rights era when the 14th Amendment was clarified and was mostly used by ultra-nationalist racist Whites from the American South (Confederate sympathizers) as an argument against Black Americans finally getting full equality. Later the talking point was developed by the oligarch-funded Heritage Foundation “think tank” in the 2000s as an attack against the 14th Amendment as a whole, using the Chinese boogeyman as the foil but actually what they mean is anti-non Whites, specifically Black American. The idea is currently being pushed by MAGA.
My brother is a charge nurse at one of the major hospitals in the Los Angeles area. He had observed some cases of birth tourism, but it’s rather rare. Also since the Obama days hospitals are required to report if a foreign national is making neonatal appointments ahead of time so these pregnant women are usually actually in their third trimester, not first trimester. They simply go to the hospital when they go into labor.
Birth tourism is not illegal, though obtaining an entry visa under false pretense is illegal. These Chinese, Russian, Nigerian, and Filipino women are not rich by far… the process of visitors from certain countries, where they are women of child-bearing age, usually involves proving they have about $50,000 in the bank and a job in their home country to prevent TNT and evading visa expiration to become an illegal immigrant. If the woman was rich, her family could just invest $500,000 into an American business and stay in the US legally and even be fast tracked for a Green Card. So most of these people are middle class.
While I find the practice of birth tourism to be distasteful, it is really being used as an attack on the 14th Amendment by a crazed racist minority of Whites who want to force Americans who in theory would be stripped of citizenship to become a new slave class. They actually talk about this openly in their online spaces. Besides these women usually go home, and the birthright citizenship of their child is kept as a backup option in case their country goes bad… which makes indicates how much faith they have in the long term prospects of their country. Their children, who is an American under the US Constitution, does not receive any benefits or social welfare because the child is not in the US presently. Even if the plan would be to send to the child back to access US education, there is a residency period requirement for most US universities, and they would need to pay full tuition anyway. Overall it’s not really a problem. If there is any illegality, anyone who is not a diplomat is subject to the full jurisdiction of US laws.
Here’s a recent criminal case regarding birthright citizenship:
https://amp.cnn.com/cnn/2025/01/27/us/woman-sentenced-chinese-birth-tourism-intl-hnk
Note here that the Chinese couple involved, who were assisting foreign nationals from many countries, including the Philippines, were not charged about birthright citizenship because that’s not against the law. Rather they were charged for providing false evidence to the immigration and border security officials who process the visas. Similar schemes like pay fake marriages for Green Cards are also prosecuted under the same basis of lying to immigration officials. Quite a few Filipino families of middle class means used to send their daughters through such fake marriage schemes where a bachelor who is a serial fake marriage agent accepts $30,000-50,000 per fake marriage until it was cracked down on during the Obama years.
thanks joey for the very enlightening info.
Again, two different topics. Improving health care for Filipinos is important. Fix Phil Health first. But that has nothing to do with a private effort to do what Department of Tourism talks about but has not done in a material way, like Thailand apparently has, medical tourism. A private effort can put the pieces together. It’s a data and contact arena, something BPOs are very good at. And it would boost Philippine medical services overall I suspect, attracting or keeping quality doctors. Yes, at private hospitals in the main.
But it is indeed different, speculative, and would require real work to carry it off. That would not scare me. It looks fun, frankly.
Well to reiterate, I don’t have a problem with the private medical sector developing medical tourism, and there is possibly a role for government to facilitate that. But it’s just my opinion that this scheme as pushed by the Marcos Jr. administration is just another example of the penchant of the Philippines trying to “jump the ladder” as I often say, with shaky planning, too little budget, and not enough resolve to push it through to the end regardless of bumps on the road. The result is often falling on one’s ass and being discouraged from trying again, at least for a while.
Let’s take Thailand, another country I’ve traveled at a comparable level to the Philippines (I even considered moving there in the mid 2000s). Thailand is well known as a medical tourism destination not because suddenly the private medical sector decided one day it might be a good idea. Rather, the Thais took a conscious effort to build a national healthcare system starting in the 1980s as they pulled their country out of the third world. By the early 2000s, this was made into formal law through the Universal Coverage Scheme (UCS), otherwise known as gold card or the “30 baht” system. Not many had considered Thailand a top medical tourism destination before the 2000s…
My point is the development of public hospitals and clinics led to a medical university to public to private pipeline that enabled that very Thai medical tourism industry to exist in the first place. For example, why is Thailand known as the premier destination for reconstructive surgery in Asia? Because there is a well-trained cadre of surgeons in Thailand going through government hospital pipelines. Likewise for other medical specialities. Thai doctors are world class, and often pass the CA or NY medical board which are the toughest in North America in one go. Whereas I’ve met quite a few Filipino nurses here who were actually MD degree holders from the Philippines. Likewise for pharmacy technicians who were pharmacist graduates from the Philippines. Outside of a few top medical schools in the Philippines, the others seem to have a very subpar standard of teaching.
Many times the Philippines puts the cart before the horse. The Philippines sometimes sees other nations achieve something perceived as great, then wants to be at the same level, but often the political leadership wants to do it with little to no effort, and basically for free. The government emphasizing the private sector is a sign of laziness, wanting others to do the work. It is also a risk mitigation move, because if the private sector fails then the politicians will not be blamed. No wonder government initiatives often fall through in the Philippines.
Which is why I didn’t propose a government initiative. We are dealt the cards in our hand and play them to the best of our ability. The “we” is BPOs. The cards are competent Philippine medical services, low costs, and market demand. And some worthless cards that we will dump at the next draw.
I think there might be a misunderstanding of how the BPO industry works. The BPO model assumes almost total investment by the client, which clients are willing to do even if the foreign client needs to give up majority ownership to the local Philippine business partner as the cost of labor for call center agents is comparatively very low in the Philippines. I cannot see a BPO-ization model for medical tourism, as such industry brings no benefit to the foreign client company. Why would a foreign company subsidize a BPO-ized medical industry when the foreign can make much more money milking the various Western healthcare public or private health insurance schemes?
I noted previously that private capital in other SEA countries have done more, with less capital, than Philippine business tycoons. Now if Philippine tycoons want to create a private medical tourism industry, then I do think the government should help with some facilitating. In the Philippines, it seems to me there is a fine line between a good idea for a new industry, and an industry that becomes a new way for risk-adverse Filipino tycoons to rent-seek. If someone else had already invented the wheel, so to speak, would it not be smart to copy and adapt that invention? South Korea’s current medical tourism industry was based on the Thailand model, and both started off by building the government public to private pipeline of trained medical staff. There was a time not long ago (just about 20 years ago) that beauty and plastic surgery-crazed South Koreans dreamed of going to Thailand to do their cosmetic surgery.
You are more optimistic at getting government to be competent than I am, and the underlying motive for picking a BPO to actually put something together is the pressures they face with AI. They can twist slowly slowly in the winds or take initiatives.
Business Process Outsourcing mainly exists as a cost-cutting industry for soft-services like call centers. The business model won’t be able to translate to tangible services like medical, or let’s say manufacturing. By nature BPO clients can pick and choose local partners across the world, and transition operations there on the fly. We do a similar thing in IT, where when I started every enterprise had an in-house IT team that managed servers running the business. Nowadays most everything has transitioned to cloud providers where with the click of a button I can migrate the entire IT infrastructure to another provider. Moreover, the threat from “AI” isn’t that AI is smart per se, but the fact that many processes can be automated, like a modernized version of the automated telephone system, otherwise known as interactive voice response (IVR). Where providers like the BPO industry in the Philippines and other English speaking countries will lose out to AI is deployment of better logic and responses in the IVR. There is nothing inherently smart about AI. AI still depends on pre-coded logic chains.
I tend to think things change.
One thing that has been changing is that what was offshored is often getting nearshored, meaning moved back closer to home. German firms often have call centers in Northeastern Germany nowadays. The costs are relatively low there, not as cheap as abroad, but still.
Some companies have moved programming operations from India to Transylvania, for instance. For some things, going all the way abroad is cheaper but less efficient, so not as much saved. Recently, I have heard vaguely of firms requiring cloud data to be stored on EU-based servers. Today’s global world is one in which fences of customs duties and distrust are being raised. Some firms don’t dare produce stuff involving intellectual property in China anymore, I heard. Some of all this will benefit the Philippines, some will not, one has to take a close look for sure.
Excellent point. Resistance from the trend inward. The Philippines has everything to be self contained except competence.
Well certainly that is a true statement.
By the way, most AI skeptics are technologists themselves who caution a moderated approach, while AI evangelists tend to be non-technical and thus apply their own idea of capability. That idea of capability often does not translate into real world practice.
Here’s an informed prediction on AI — AI as exists on the current trajectory will first be applied to further hijacking brains through algorithmic manipulation. It’s not as complicated as one may think. By AI giving a sense of informational superiority that gathers trust, that brain hacking would be all too easy.
Oh, that’s scary enough. I’d say the process has moved quite far along already and AI will trap us all in well-crafted illusions. AI will re-write Wiki and how are we to know what was historical fact or Magnificen fiction penned by mathematical machines.
I’ve briefly explained previously a few weeks ago the tech oligarch vision of the network state. It’s truly terrifying what their views are that has developed the further they distance themselves from reality. Musk is just the prominent example, but in the shadows beside him are dozens more tech oligarchs who are subtle. Musk’s aim is to be the emperor of humanity in a sense, which is why he’s content to utilize Trump as his wrecking ball even if it means Trump would be the king of the United States. A king reports to an emperor after all. I am very wary of Musk’s AI endeavors like Grok, and I am equally wary of Altman’s OpenAI. Nothing good can come of this. The scheme seems so simple — get humans to become lazy addicts to seemingly instantaneous information, then inject that informational algorithm with malevolent data to be fed into already hijacked minds. It seems conspiratorial, but people need to wake up.
I think many are awake, but powerless. I do note that street protests are starting up to address the cruelty and lawlessness of Trump/Musk, but with China and Iran pushing AI for manipulative purposes, I don’t see how that cat ever gets put back in a bag.
I don’t think that is completely true that people are awake. It is much more comforting to be ignorant, which is a human survival mechanism common across all peoples, the US, Europe, even Philippines. Most eligible voter Americans did not even vote at all in most elections, which points to a level of apathy.
When I review the excesses of the Gilded Age, or even the Roaring Twenties, today’s society has a similar level of excess in both wants of the people and abuses by the rich. This behavior has been broken and reigned in before, and it will again. A handful of the powerful cannot win against the combined power of society once society wises up.
In this case you are again the optimist and I’m the pessimist, but we need not put money behind our bets. I follow Mark Cuban on Blue Sky, and he reported what advice he gives to young people these days. Read, and know all you can about AI. That’s a powerful set of equals, reading and AI. The future will not be real, as we used to know it. It will be augmented.
There was also a time when the power and influence of Gilded Age robber barons seemed unstoppable. Those robber barons even had private armies (e.g. Pinkerton Agency). Their candidate was McKinley, who espoused the externalized nationalist viewpoint shared by certain “bought” members of Congress at the time who supported the takeover of Spanish Empire possessions and taking part in the Chinese Concessions. They had a compliant media in rabid yellow journalism, their version of social media in those days. Their power did not last once the people felt real economic pain that the people connected to that ideology. The trick in controlling people through negative ideology is to keep people at the knife’s edge, where people are in smoldering despair, but not to the point society will burst into outrage. Greed knows no bounds and greed eventually pushes too far, which will be this current time’s robber barons downfall as well.
Mark Cuban is center-right with some classic libertarian viewpoints. Once upon a time as a youth I espoused even further right libertarian views of the Orange County GOP nexus. Ayn Rand was my hero, and I eagerly read her Objectivist drivel. There comes a point where one must ask one self where pursuit of personal liberty encroaches on the liberty and right of happiness of others in society, which is where I started drifting leftwards. Today’s libertarian-tinged MAGA pursues that naive selfishness. But the funny thing is once they realize they are just regular Joe’s like any other person and not given the privileges they want to be taken away from others, they will have an opportunity to change their viewpoints.
I see two ways of AI progressing. The first would be used as an instrument of control, much like social media algorithms are used now, and yellow journalism was used previously. The other way would be as an enabler of progress. Throughout history humans have invented tools that often have dual uses, some good, some bad, depending on how the tool is applied. When the printing press was invented, it was quickly used by radical and reactionary journalists to spread their own propaganda. But the printing press also democratized knowledge that until then had been exclusive to the few. The allegory of the Expulsion from the Garden of Eden alludes to our human capacity of reasoning. It is up to individuals to choose to use that great gift that separates us from lower animals.
I imagine AI development will pursue both paths, an instrument of control and an enabler of progress. When it is used to strip Wiki of uncomfortable truths, we will be controlled. When it is used to speed analysis and program development, we will progress. But we’ll never get Wiki back in order because the data will disappear. Humans cannot reason properly with bad data, thus my pessimism.
Wikipedia is a lot more resilient than that. There is a process of data silo control on Wikipedia where moderators and curators scrutinize heavily edited wikis quite closely. You can try editing a mainstream wiki article and see how fast your edits would be rolled back, up to the point where your Wikipedia editing rights would be revoked/banned. The Wikipedia moderation community leans libertarian by the way, as in true libertarians who believe in free access to information as existed in the early Internet. Not any of this fake “libertarian” nonsense espoused by the GOP, which is why Wikipedia is a a common attack target for the GOP.
One of liberalism’s core tenets is the free flow of information, leaving interpretation up to the liberalized individual. There is an idealistic assumption of basic capability common to all, though that often doesn’t work in practice, which is why liberalism also assumes auto-correction through the power of consensus.
Authoritarian movements like MAGA do not like the power of consensus, nor the freedom of debate. Authoritarianism demands that others accept the authoritarian viewpoints only as the orthodox, and by force if necessary. This is why authoritarian-minded groups build their own alternative information networks, starting with newspapers but accelerated by cable broadcasting and turbocharged by social media. But one wonders what would happen when these authoritarian-minded groups have “total” capture, where they control the information space and have no strong opposition. The result is often that they will break down into in-fighting. Subtle signs of such are already apparent in this Trump 2.0 administration with the Bannon faction vs the tech oligarch faction vs the corporatist faction. It might not be apparent to observers who are a bit further away, but to those who pay attention here there already are cracks forming which may be attacked.
Joey
Re Content Moderation
https://hbr.org/2022/11/content-moderation-is-terrible-by-design
Thanks for sharing the article Karl. It has excellent points.
Here’s something to consider regarding content moderation: content moderation, even when humans are involved, is mostly American-centric as the biggest social media companies are American. Aside from the misunderstanding about First Amendment by Americans (1A exists to protect private individuals/entities from government censorship), social media content moderation teams are heavily from the American POV. There is little effort in developing local moderation teams for specific languages and cultures. FaceBook for example is complicit in the genocide occurring in Burma, and the hijacking of the electorate by foreign influence operations in the Philippines and the US in 2016.
Little effort was made to rectify this glaring problem, as it simply isn’t profitable. Even hiring content moderation teams of poorly paid Eastern Europeans is “too much money” when it comes to corporate profits and as such moderation teams are being cut left and right to be replaced by algorithms. Algorithms of course are coded by humans, and by and large algorithms are skewed towards a White American lens despite being coded by Indian programmer consultants. Even the addictive properties of TikTok, a PRC company, is based on an algorithm team that has many inputs from American staff. This problem will only become bigger over time.
Interesting read, Karl, thanks. I cannot imagine the challenges of high volume content moderation. Low volume content moderation is very difficult. Is trolling free speech? Is a comment thread a platform for freedom of expression? Do people behave politely and truthfully? The answer is no, no, no. Eventually a moderator must take a decision, forcing responsibility on the irresponsible. That’s just the way the cookie crumbles.
Thanks for reading with me and for the valuable inputs
No, thank you Karl for sharing!
closest existing BPOs to the proposed one are the HMO BPO services.
The other one are the Telemedicine Apps
hmo is not free and one has to be subscriber. what worries me is the safety of my personal data being held by a third party. and if my data are shared and access by promo companies, I will be inundated with unwanted medical ads.
Data Privacy Act backfires by the Disclaimer or waiver bottom line.
Escape Clause
For Government We have the Universal Health law. If Binay gets her way free dialysis and Chemo for all.
A bit OT, here is a video on the start of the Michelin Guide’s Philippine journey, in cooperation with the DOT. Joey did mention promoting leveled up Filipino food. This might be a start. I am going to eat breakfast now. I am craving lechon.
A hot dog will get you close.
I made lechon belly the other day. But it was a mashup of Cantonese, Vietnamese, and Cebuano styles in that flavor profile. The skin disappeared quickly. 🙂
While I prefer Filipino ulam that originated in Hokkien and thus Yue cuisine, there are more “native” ulam that I’ve had in my travels. All are quite good. The main problem is lack of color palette, incorrect use of spices in most home cooking, and general inattention to detail. The basic ulam has ample room to be elevated quite a bit while staying true to various Filipino ethnic cuisine. Now I’m not a trained chef. I’m just a practiced amateur with the knowledge in culinary technique and a bit of artistic flair. People I meet there seem to enjoy my take on Filipino dishes though. Someday a Filipino is going to figure out to make Filipino comfort food world class, but it would probably start with young Fil-Am chefs who are trained in culinary school.
Joey,
Give me a lowdown of why you disagree with the proposal.
I prefer to hire a bunch of experts than train people from scratch even for a premium.
Brain drain? Those left behind are chopped liver
You have a tendency to judge based on limited interaction and information. It is true that you have been places more than an average Filipino but take it easy on the busting buster.
I will try to collate some of the thoughts I’ve shared across various comments, mostly with Joe here.
1.) The proposal is hinged on a BPO/BPO-like model, but the services outsourcing industry itself is modeled around low overhead, and often low investment in both building something physical (e.g. a building) and hiring technical staff (often outsourced staff are what’s called in purely labor terms “unskilled labor). BPO is inherently a “soft-skill” industry versus a “hard-skill” industry.
2.) Medical buildings for cutting-edge hospitals are much more expensive to build than a BPO operation employing CSAs, which can be placed anywhere. The modern high-rise BPO parks in the Philippines are not the norm. Most BPO operations are out of much smaller buildings.
3.) Foreign clients investing capital may be willing to pay rent on a building, provide laptops, and work with a local Filipino BPO partner to train CSAs, but I doubt they will put forward the vastly higher capital expenditures for a hospital.
4.) There is also the ability to recruit and retain talent. I have observed that Filipinos who would otherwise go abroad, would rather stay home close to family and comfort of familiar surroundings. But when a BPO CSA with only a high school diploma can earn as much as a BSN, there’s no surprise we will find BSN graduates who have already passed the PNLE who work as a BPO agent. Others will go abroad to earn 300-500K a month. Just like talented teachers who leave DepEd and go abroad to let’s say, Thailand.
5.) The healthcare system, especially in the US, makes an obscene amount of money from Medicare and Medicaid alone, not to mention the medicines many of which legally (due to patents) there is no pathway for a generic version in the US. Medicare and Medicaid are government funded and the revenue is all but guaranteed. There would be no reason for a foreign healthcare industry to move those operations overseas and lose that money. They are willing to move CSAs though, which they already have.
6.) There are patient privacy laws that are relevant such as HIPAA in the US. This is a big barrier.
7.) If the proposal instead shifts to telemedicine, then aside from privacy laws, there is also the question of local board accreditation. The Filipino telemedicine care provider (MD, PA, etc.) would be required to pass let’s say the California Medical Board, or New York Medical Board, the two most valuable accreditations in the US. Those accreditations are very hard to achieve, which is why there are a lot of migrated Filipino doctors who are willing/forced to step down to going back to school to be a RN.
8.) With Canada and Mexico nearby, or in the case of the Schengen Area in the EU, there are much cheaper options for elective or cosmetic surgeries nearby. I do not share Joe’s view that somehow these options would be gone under Trump in the next 4 years.
9.) Patients that cannot afford procedures in their home country often do not have healthcare insurance and thus are cash paying patients. If they can barely afford to go to another state, or nearby country, it’s highly unlikely they could go to the Philippines for that same care.
10.) It has to be said that in the Thailand example, many of the medical tourists are availing cosmetic procedures, not primary or secondary care. Thailand’s medical tourism industry is highly specialized in that area.
11.) I saw chemotherapy or dialysis thrown around. Dialysis is already 100% covered in the US since Nixon. If someone is so sick they need chemotherapy, if it were me I would not risk going to a completely foreign country to achieve that care. Besides, chemotherapy is already covered to a large degree under most employer plans in the US, covered fully under government plans like Medicare and Medicaid as long as the primary care doctor justifies the “prior authorization.”
12.) Still, I’m not disagreeing on the premise of the proposal, only in its implementation by a BPO model, which again assumes the foreign client would pay for the large part of the industry. Not going to happen. I do think however that Filipino tycoons have the capacity to implement the proposal, with government facilitation.
I don’t think I have a tendency to judge. Rather, I operate based on a critical lens of what makes sense and what doesn’t. I’m open to changing my opinions if I’m shown evidence that challenges what I know and what experienced. I try not to opine on stuff I know little about, so everything I share is based on my direct knowledge and observation. I really hate being incorrect, and opining outside of experience and knowledge tends to lead to correction. By the way, I have spent a good part of my career in the healthcare industry in hospital systems, and gain a lot of insight from my brother who is one of the head nurses in one of the largest hospital systems in California (University of California, Irvine).
I’ve lived a life of poverty, hardship and adversity, at least until I graduated university. I take a realist point of view, and need to consider hard truths. A problem I constantly encounter in the Philippines is too many unrealistic, pie-in-the-sky schemes which ultimately fail then the participants seem to be confused to as why their plans had failed. It would be better to build step by step, making sure that the foundation is sound, and the succeeding layers are stable before moving on. The idea is to build a foundation for future generations of Filipinos, and I think that is a noble and achievable goal long overdue.
I won’t respond to the details but will say the proposal anticipates that health care in the US will be different in a year or two after Musk and Trump take an ax to medicare and Obama care. That’s key to the proposal. Readers have noted that Thailand succeeds with medical “tourism” so I don’t buy the negativity as it pertains to the Philippines. Top hospitals here are excellent, costs are markedly lower. It does not have to be a BPO that puts the elements together. It can be one bright guy with a computer, or an entrepreneurial company. I probably need to put together some hypothetical illnesses, the costs to patients, and the potential income for the hub operator. I thank everyone for their inputs.
I still have a hard time seeing how poor people on Medicare and workers with insecure employment that doesn’t have decent employer insurance and thus need to depend on Obamacare would be able to travel overseas for treatment. The US government isn’t going to pay a Medicare funds to foreign institutions, and those on Obamacare often can barely afford their premiums in the first place. There are also the big problems of HIPAA patient privacy and ability for foreign provider to gain accreditation in the various states.
Any medical industry in the Philippines catering to foreigners probably has to approach it from the cosmetic or non-urgent elective surgery angle. Just like Thailand.
I submit that those who can’t afford simply just can’t.
Millions of US residents travel abroad each year for medical care, a practice known as medical tourism.
Destinations
Mexico and Canada are the most common destinations for US medical tourists
Other destinations include Central and South America, the Caribbean, and countries like Costa Rica, Cuba, and the Dominican Republic
Procedures
Medical tourists may travel for cancer treatment, dental care, fertility treatments, organ and tissue transplantation, and various types of surgery
Some people with rare conditions travel to countries where treatment is better understood
Cost
Most medical tourists pay for their care at the time of service
Some US health insurance companies and large employers have alliances with health care facilities outside the United States
The cost comparison between medical tourism destinations and the United States reveals significant savings for patients seeking various procedures abroad. Here are some key insights:Cost ComparisonsGeneral Trends
Factors Influencing Cost Differences
Total Cost Considerations
While medical tourists benefit from lower procedure costs, it’s essential to factor in additional expenses such as travel and accommodation. However, even when these costs are included, medical tourism often remains a more economical option compared to domestic healthcare for major surgeries or specialized treatments.
In summary, medical tourism offers substantial cost savings for a wide range of medical procedures compared to U.S. prices, making it an attractive alternative for many patients seeking affordable healthcare solutions.
Thanks Karl. I’m doing a follow-up article that does this same kind of sizing. So we can discuss the matter after that.
Most Welcome. Looking forward.
These numbers for the general cost of these procedures sounds about right Karl, but these are “out of pocket” costs aka cash price. No one in their right mind would pay this as they would just avail the Affordable Care Act aka Obamacare if in the US context. The cost to private insurance companies is negotiated between the insurance company and the healthcare provider, and is usually much lower, about half. From that, the patient is expect to personally be responsible for a proportional co-pay (typically 20% of the procedure) up towards their insurance premium’s yearly cap. For example, a premium plan might have a $3,000 yearly cap, about $7,000 for a middling plan, perhaps $15,000 for an insurance plan with a cheap premium. Once a patient has gone over their premium cap, the insurance is responsible for all other costs, including for cancer treatments which can be very expensive. So availing let’s say Obamacare is still cheaper than going overseas even for the most expensive health needs.
A lot of Americans who go overseas, for example to Canada, Mexico, or Latin America for healthcare are also visiting family. For example, a Mexican American visiting family may avail the local healthcare or dentistry services and pay a cash price as that may be cheaper than paying the co-pay for that specific procedure. For Americans who do not have family ties to those countries, the usual procedures are often cosmetic in nature, and thus not covered by insurance plans. To use an example from dentistry, it costs about $5,000 for a cosmetic procedure such as dental braces, typically paid in cash, so let’s say a Fil-Am teenager may visit the Philippines with his/her parents, and avail dental braces which might cost a fraction of that, about $1,000 total.
The Americans who cannot afford Obamacare, are usually covered under Medicaid, the federal healthcare plan for indigent citizens. If they don’t qualify for Medicaid, and also don’t have the financial means, they would not be going over to the next city, much less overseas.
If Trump ends Obamacare then is it the end?
http://aljazeera.com/news/2024/11/5/fact-check-did-donald-trump-ever-mention-ending-the-affordable-care-act
Well this is a complicated subject tbh. Legally, no Trump cannot “end” or “delete” (in childish Musk terminology) laws which were passed by the US Congress. He however as the executive can throw roadblocks in front of the law. Trump is ruling by executive order despite having captured a (slim) majority of Congress and a majority of the Supreme Court when he could simply work with his allies in the other two branches to repeal Obamacare and pass a replacement law. He does not because he is both an imbecile and he is weak, and GOP Congressional control is weak. The GOP Congressional majority is more prone to fight amongst themselves than try to pass laws, because they can’t get the majorities needed even among their House caucus. If they miraculously passed the House, Democrats can filibuster in the Senate and force a 2/3 vote rather than majority vote.
Well his roadblocks may end up crippling Obamacare, and he may break Medicare for pensioners and Medicaid for the poor, but most of the people who depend on these programs are his own poor, sick voters. Democrats in general are more educated and at least have office jobs or unionized jobs with employer-based healthcare and won’t be affected. Obamacare after all, is a program to help the poor, most of who are Republican voters voting against their own interests.
Pie in the sky.. there is a very specific case I recall. I was able to get a lunch meet-up in 1995 with the IT head of DFA. He wanted a big database of all abroad Filipinos with full online access worldwide. I told him better have distributed local DBs in Embassies and Consulates with overnight mirroring to Manila as the bandwidths were expensive back then. The answer was we are DFA we should not think that way. My father told me maybe he wants lagay. That might have been true as the man became a central IT coordinator for all government offices and thus approver potentially for all IT projects during Erap’s short Presidential term. Who knows. Most probably, there is no such database until now, though it would be grand if there is.
Well, in 1999, I was part of a project where we implemented an application that connected between Eastern European offices of a Japanese multinational and a regional office in Switzerland. We had to implement write-thru caching and similar logic to have tolerable reaction times as in those days, the downstream and especially upstream bandwidths were simply far from what we are used to today and the infra in Eastern Europe wasn’t ready yet. That Japanese firm had way more money than DFA potentially but did NOT want “en grande.”
This story always amuses me when you retell it. Sad, but amusing as it illustrates the point. Whether en grande or jumping the ladder as I say, only having an eye on the ideal is the wrong way to go, and is a sure setup to disappointment in my experience. It’s also naive. Rather, a generalized “big goal” should be made, then succeeding but more clearly thought out “mini goals” should be implemented to build up on preceding successes. Eventually all those completed mini goals add up and viola we’ve arrived at the big goal. Trying to jump directly to the big goal is a gamble — sometimes it works out, and overconfidence is reinforced, but too often the lack of proper planning creates the obvious conditions for complete failure and discouragement. I’m an old school Waterfall guy despite being your junior. Detailed plans, and alternative plans to cover anticipated blockages, work. During execution is the worst time to come up with a plan. Execution is the time to tweak pre-drilled plans with the OODA loop — Observe, Orient, Decide and Act, to recalibrate one’s actions.
I have often used some sort of agile before it existed as I started working in small and medium settings, but the paradigm of sprints and reviews is not too different from implementing and then going through the OODA loop, there has to be theoretical-practical sync always. Especially the Philippine situation needs a lot of syncing like that because what things are described to be often strongly deviate from what really is over there. That means the extremes of analysis paralysis and Popeyes School of Hard Knocks are both wrong.
The music industry of the Philippines has had several attempts by different players at landing an international hit. What I think many underestimate is that Filipinos and their culture have a mood and sensibility way more different from the Western sensibility than most realize. You calling Filipinos OA and me calling Filipinos corny are a symptom of this. Well, at least they have gradually upped music production and video quality, so they are taking small steps. It might be harder than they realize even now, and that could lead to massive disappointment.
If we were to take a Waterfall vs Agile model there are pitfalls as well, mainly stemming from improper implementation. For example Waterfall can be misused to artificially inflate risk rather than Waterfall’s purpose of risk mitigation, thus waste through budget over allocation, while misuse of Agile can lead to ignoring clear risks in the pursuit of “moving fast and breaking things” where often in real life breaking things can cause more problems. This is why in the last decade some have espoused for a more hybrid model, which I sometimes employ, and I’m sure you’re also familiar with. I mainly have an issue with pure Agile as it seems the model is a start-up one depending on non-mission criticality, and “unlimited” venture capital to cover mistakes. The successes of Agile are often celebrated, but the mistakes are susceptible to being glossed over when MBA types try to implement Agile in mature organizations. OODA is complimentary to the old Waterfall way of thinking where there is an assumption of a defined set of protocols, as OODA is a strategy of the actual implementation of those pre-drilled protocols.
There is also the issue of effective management. I mentioned to Karl previously that in my estimation based on the various policy papers I’ve read generated by Philippines agencies, that the level of thought, planning, identifying risks and possible solutions is very, very high. Philippine policy papers are very well written, with concrete advice. So from that observation I considered that the Philippines doesn’t have a dearth of experts at the top level. Rather, there seems to be a dearth of effective management and leadership. Philippines leadership, both public and private, often seems to either be consumed by fear of exaggerated risk despite risk-mitigation being identified in those very policy papers, or to be using the boogeyman of risk as an excuse in order to never make the first move.