10-minute read for national and local government officials, health experts and practitioners, non-governmental organizations, development agencies and problem-solvers

Foreword from Behaviorale PH:

"When Metro Manila and four other provinces reverted into a stricter ‘modified enhanced community quarantine’ last August 4, The Medical City’s chairman Jose Xavier Gonzales outlined specific strategic recommendations to recalibrate our COVID-19 responses. He emphasized behavioral economics' policy approach, which focuses on data-driven nudges or soft policy touches instead of heavy-handed police enforcement.

The article shows how behavioral economics principles can be embedded across our COVID-19 response spectrum. It distinctly amplifies the importance of the local context and physical and environmental capabilities in enabling or constraining behavioral change. Key recommendations include the creation of more ICU beds, recapitalization of PhilHealth, and the proper funding of the whole of healthcare.

Behavioral economics principles are interspersed in the proposed strategies. We observe the framing effect at play under ‘rethinking mass-testing’ below, where the choice of wording and appeal to do mass testing have led to the public interpreting that any test will do, including rapid antibody testing. The default bias can be seen in Philhealth case reimbursement rates based simply on pneumonia, which understates the impact of COVID-19 on other organ complications (see below ‘let Philhealth allow balance billing’). Loss aversion is relevant to the policy proposal to consider P3,000 shelter subsidy for targeted high-infection areas (see below ‘incentivize COVID-19 disclosures’). Anchoring heuristic can be observed in the proposal to stagger work hours from 5 a.m. to 9 p.m as a strategy to induce more jobs, avoid crowding on public transport, and reduce traffic.

Our team also uploaded the slides that directly reference behavioral economics from a longer presentation that Jose Xavier Gonzales shared with us."

The current time-out, granted at the request of the medical community, is a gift that should not be squandered. If we continue to do the same things that were done in the past, we may be doomed to a continuing loop of time-outs, without any real hope for winning against COVID-19. Now is the time to put changes into place — using principles of behavioral economics (nudge) instead of heavy-handed police enforcement (punch), executing triage at home rather than in the hospital, using research and data to guide decisions and innovate instead of relying on impulse and intuition.

Because COVID-19 continues to evolve with new strains, we have to make sure our policies adapt as well. With mutation, the disease has become more infectious, but not necessarily more lethal. However, we must make ordinary people, not medical personnel, the first line of defense. For all the messaging about the advantages of wearing masks, the latest revelation is that masks can act like a vaccine, creating a barrier to COVID-19 viral exposure. At lower levels of infection, people who are infected tend to be more likely mild or asymptomatic.

Our overworked medical workers can get the time out they need if we are able to keep mild or asymptomatic cases quarantined safely at home rather than being brought to the hospital (where they may not be accommodated anyway). Because a mild case manifests itself with flu-like symptoms, it is best, at this point, to isolate at home for two weeks, and call a doctor to monitor you through telemedicine. Having an oximeter at home is crucial so you can monitor your oxygen saturation rate (a rate below 92 means you have to go to a hospital).

But the more important aspect of these two weeks is to finally do what we should have done in the past quarantine, as well as re-evaluate our current responses. Here are some suggestions:

1. Create more ICU Beds

Because COVID cases are increasing, severe and critical COVID-19 cases continue to rise as well. They now represent 1.5% of total active cases. These cases need ICU beds. There are 525 ICU beds (at 77% occupancy as of Aug. 3) in NCR out of 1,400 nationally. We need to build the beds now. It cost P14 million at our hospital to outfit a 26-room wing for negative pressure ICU capacity. The time it took to construct was one month. The total cost for 525 more beds is around P283 million.

2. Re-think Testing

The appeal to do mass-testing has, unfortunately, been interpreted to mean any test will do, and this has resulted in the unintended consequence of having individuals who had been deemed negative via antibody testing, spreading COVID-19. Rapid antibody test kits proliferated because demand was driven up by businesses using this test as a condition for employees returning to work. Unfortunately, these tests do not catch the virus, only the antibodies. Antibodies emerge on Day 8 of the disease, when those who have the virus are no longer that infectious. They also miss at least 50% of those infected who do not have antibodies yet but have the virus. The requirement for rapid antibody tests has also led to more corruption in the healthcare system, especially given the inconsistency with which LGUs and corporations have applied return-to-work rules.

3. Empty Non-urgent COVID Beds

Patients can be sent home earlier, and they should be encouraged to do so. The average stay for a COVID-19 patient at our hospital had been 20 days. This can be cut in half; by day 10, they are no longer infectious. We had an asymptomatic 96-year-old lady by exposure who went through two swabs by Day 14, with a request that she be kept longer until PCR-negative. At that point, she was clearly still shedding virus but noninfectious. Fortunately, the patient’s family cooperated in bringing her home.

Doctors have to cooperate in this nudge. LGU’s and communities need to change their return acceptance policy so as not to overburden our very limited testing capacity. The US Centers for Disease Control advises that people can leave isolation 10 days from onset without having to wait for a negative test.

4. Use the Cooperative Model for PPE Purchases

At our hospital, PPEs cost around P600-700/set, consisting of an N95 Mask, isolation gown, green gown, earloop mask, booties, head cap, face shield or goggles, and nitrile gloves. On April 1, the Department of Health (DoH) announced the expected arrival of PPE sets procured for P1.8 billion, or P1,800/set. That’s three times what we paid for ours.

The One Hospital Group, composed of NCR public and private hospitals led by DOH Undersecretary Dr. Leopoldo Vega, has a better appreciation for purchasing economies for PPEs and equipment. This can include even medicines with proven efficacy like remdesivir (currently in short supply globally ) and dexamethasone. They should be properly empowered to manage supply requirements, pricing and logistics, for the NCR hospital ecosystem.

5. Properly Fund the Whole of Health Care

Much has been discussed about the current crisis of PhilHealth, but the institution is an important and crucial element in the survival of the medical care industry. Here are changes that should be considered:

• Refocus reimbursements on in-patient support. Let the private sector fund its own testing, however wasteful the rapid antibody test kit exercise was. As stated earlier, the cost of doubling NCR ICU capacity is (only) P283 million. But it is a strategic element of what the lockdown was originally set to do — give the health sector a reprieve to catch up, particularly for the severe and critical immuno-compromised cases, which are causing the hospital shutdowns. If we miss out on health capacity planning (once again), we shut down the economy (once more).

• Recapitalize Philhealth. By going overboard on testing, whether it be on PCR or rapid antibody, at the expense of treatment, we not only underinvest in physical capacity, but also threaten private hospitals’ financial viability. Our hospital is already out-of-pocket over P500 million, awaiting Philhealth reimbursement, and not just for COVID-19. There are other private hospitals in the same boat. Because collections have floundered with businesses shutting down and OFWs given pay-in waivers, Philhealth finances need to be reset.

• Let Philhealth allow balance billing. Since private hospitals, which comprise two-thirds of the hospital sector, are not supported with equipment and facility budgets by the government and have to pay their own way, Philhealth should allow balance billing for COVID-19 cases. Part of the problem here is that Philhealth case reimbursement rates are based simply on pneumonia, thereby understating the impact of COVID-19 on other organ complications.

• Incentivize COVID-19 disclosures. Since this is a two-week disease, why not announce a P3,000 shelter subsidy for targeted high-infection areas, based on symptom-based assessment by a clinician, using other basic tools like a temperature scan, oximeter, and chest X-ray, maybe with a confirmatory PCR swab if results are available in 24 hours (otherwise forget it). This can ferret out the mildly symptomatic, with an accompanying option (doctor’s discretion) to community quarantine if space isolation is an issue. Contact tracing for the exposed will naturally follow suit (but without the subsidy).

Since this whole disease began, there have been over 100,000 COVID-19 cases. Flushing out another 100,000 in high-infectious areas to reduce cluster transmission risk through disclosure incentives costs but P300 million. This compares with the P1 trillion reduction in GDP and 5 million loss of jobs for 45 days’ lockdown.

6. Stop the Spread, not the Economy

Distance between persons and duration of exposure are two elements critical to controlling COVID-19 spread. Already among the longest and hardest lockdowns in the world, the NCR shut down its emergent public transport system once again from Aug. 4-18. Totally.

Research about the infective aspect of public transport, however, suggests that with proper management, public transport can remain open. The key is to reduce crowding. Pre-COVID-19, there were 15 million passenger trips daily within the NCR. Theoretically, there should be double the number now, for social distancing purposes.

Work-from-home, shelter at home for the elderly, and children not going to school cuts trips by at least one-third. As part of a hurry-up plan, the NCR bus fleet can also be increased by 2.5 times, to 12,000 units, and run on two shifts, also saving jobs for displaced jeepney transport workers.

Buses can move twice the number of passengers as jeeps, and 15 times the passengers of cars. We can raise transport fares and let the market seek going-to-work equilibrium under the new normal and ensure that there will be no crowding on public transport and much less traffic.

In fact, if the national government changes its strategy to stagger work hours from 5 a.m. to 9 p.m., the private sector will follow, with more service and public-sector jobs created. Job creation is a notch above direct transfers as a preferred economic stimulus tool.

Jose Xavier Gonzales is the Chairman of The Medical City. This article was first published on BusinessWorld.