Taiwan Post Seeks To Expand Into Healthcare

BMI View: Declining volumes of letters sent, coupled with an ageing population, will result in commercial opportunities for postal agencies to provide basic healthcare services to aged people. Postal agencies are potentially better able to provide such services than healthcare entities, given their wide network. However, we stress the need for postal employees to be equipped with basic health or first aid knowledge if they are to provide a value-added service for the ageing population.

Taiwan's postal system, Chunghwa Post, has stated that it may branch into the adult day care market to generate additional revenues. However, a number of challenges must be first overcome. According to Wang Chang, president of Chunghwa Post, its employees have been visiting the elderly and doing grocery shopping for them voluntarily. The firm plans to introduce other services for the elderly, including a 24-hour telephone consultation line, grocery shopping support and safety confirmation checks, and will submit a proposal on the new service to the government in February 2014.

The idea was first proposed by the Legislative Yuan in November 2013. It involved establishing a paid service to care for the elderly in Taiwan, citing Japan Postal as an example. In Japan, the postal service charges a monthly subscription fee of JPY1,050 (US$10.20), which covers one monthly home visit and invitations to lunches held at post offices.

Ageing Population
Taiwan's Pensionable Population As % Of Total Population

BMI View: Declining volumes of letters sent, coupled with an ageing population, will result in commercial opportunities for postal agencies to provide basic healthcare services to aged people. Postal agencies are potentially better able to provide such services than healthcare entities, given their wide network. However, we stress the need for postal employees to be equipped with basic health or first aid knowledge if they are to provide a value-added service for the ageing population.

Taiwan's postal system, Chunghwa Post, has stated that it may branch into the adult day care market to generate additional revenues. However, a number of challenges must be first overcome. According to Wang Chang, president of Chunghwa Post, its employees have been visiting the elderly and doing grocery shopping for them voluntarily. The firm plans to introduce other services for the elderly, including a 24-hour telephone consultation line, grocery shopping support and safety confirmation checks, and will submit a proposal on the new service to the government in February 2014.

The idea was first proposed by the Legislative Yuan in November 2013. It involved establishing a paid service to care for the elderly in Taiwan, citing Japan Postal as an example. In Japan, the postal service charges a monthly subscription fee of JPY1,050 (US$10.20), which covers one monthly home visit and invitations to lunches held at post offices.

Ageing Population
Taiwan's Pensionable Population As % Of Total Population

This proposal is unsurprising given the ageing population in Taiwan. In 2012, 11.2% of its population were aged 65 years and above. Accounting for its low total fertility rate, the proportion of this group is forecasted to expand to 20% by 2025. Chunghwa Post reports that it has approximately 1,300 branches and 9,000 mail carriers. Given the main job scope of postmen and the wide existing postal network, these postmen have the capacity to provide care services for the ageing population. In addition to Japan and Taiwan, postal services in certain other countriesare also engaged in health-related services.

Prescription Drugs Distribution

In many countries, a lack of medical health professionals and facilities means that patients often have to wait for longer before they can see a doctor. Particularly for patients with chronic diseases, visits to a doctor often means simple checks (such as blood pressure) and collection of prescription drugs. In an ageing population, elderly patients make up the bulk of the patient burden in hospitals and clinics, reducing the amount of time for patients with acute conditions. Consequently, countries such as the US, Malaysia and Australia have created a 'prescription drugs by post' system. For example, Australia Post allows medical products to be delivered at reduced postage rates. These include prescription and non-prescription medicines posted by/to registered medical practitioners, ophthalmologists, optometrists, opticians, dentists and retailers, or wholesalers of medicines and medical supplies. In May 2013, Jersey Post and Health and Social Services, which is based in the British Crown dependency of Jersey, announced a trial whereby postmen will call up members of the service to ensure their wellbeing and report any concerns to relevant partner care organisations.

Win-Win For Society

Besides the obvious benefits to senior citizens living in remote areas, we highlight that services providing care to the elderly may represent a revenue generating opportunity for postal services. Since the advent of the internet, mail volumes, particularly of letters, have declined. In a study by The Heritage Foundation in the US, in 2000, the country sent 103bn first-class mail items, but the volume declined to approximately 69bn in 2012. [1] The study also cited a decline in letter correspondence from an average of 1.6 personal correspondence per week in 1987 to 0.7 in 2012. The decline in postal demand has contributed to the US Postal Service's fiscal difficulties, with the agency reporting a loss of US$15.9bn in 2012.

In light of the declining volume of letters sent, various postal agencies have implemented other services to boost income, including having their own online shopping services, allowing consumers to pay bills through its postal systems and remittance services. The additional healthcare services may also boost revenues, especially if there are customisable care package for individuals. However, despite the obvious benefits of the wide network, we note that unlike the provision of other additional services, the delivery of healthcare requires postmen to have some form of healthcare expertise or, sometimes, first aid knowledge. Postal agencies may therefore be required to invest in healthcare training as well as increasing the number of employees in order to provide better care. This will potentially impact revenues in the short term.

[1] Gattuso, J. L. (2013, October 10). Can the postal service have a future?

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Sector: Pharmaceuticals & Healthcare
Geography: Taiwan
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